OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Steady to 5 Higher |
| Butter Futures: | 1 to 2 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 3 to 5 Lower |
| Soybean Futures: | 6 to 8 Lower |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 6 to 8 Lower |
MILK:
Milk futures were able to find some stability after early weakness yesterday. That will not turn the trend higher unless underlying cash will trend higher. That is not likely to happen anytime soon. The best we may hope for is stability for a period. However, demand for products moving into next year may not be enough to support prices as milk production is strong and higher than a year ago. Exports of dairy products have been strong but not enough to keep prices higher or to turn the trend higher. The Consumer Price Index rose 7.1% from a year ago which may have an impact on how much the Fed will raise interest rates today. If inflation is slowing, demand may remain better than earlier estimated.
CHEESE:
Prices are expected to remain choppy through the end of the year with block and barrel prices diverging from each other frequently. American cheese inventory may not be larger than a year ago at present, but inventory remains large historically. If demand does not increase during the first half of next year, inventory may increase significantly.
BUTTER:
Price will remain volatile but may stair-step lower through the end of the year. Most of the retail demand has been met for the holidays with some purchasing being done for next year. However, with price weakness, buyers may pull back a bit on their purchases for the upcoming year until the market settles out.
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