OPENING CALLS:
| Class III Milk Futures: | Steady to 10 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 3 to 5 Higher |
| Soybean Futures: | 7 to 10 Higher |
| Soybean Meal Futures: | $4 to $6 Higher |
| Wheat Futures: | 4 to 6 Higher |
MILK:
Class III milk futures finally showed some life Thursday due to minor strength of underlying cheese prices. The gains were good but not exceptional with traders unwilling to put extra premium in the market due to the uncertainty of demand and price potential. With current milk supply sufficient for demand and the potential of milk production to outpace last year, there is a possibility of greater supply than demand for a period of time. Mild weather is good for cow comfort, keeping milk production stronger than a year ago. USDA will release the November Dairy Products report Friday afternoon showing the level of dairy product output for the month. The report is not a market mover.
CHEESE:
The minor bounce of cheese prices Thursday was not the result of buyers looking ahead due to the potential for tighter supply. They were taking advantage of lower prices to purchase to fill orders or to replenish aging programs. Buyers may remain unaggressive with little desire to chase the market higher. Cheese supply is expected to increase in the coming months as inventory builds.
BUTTER:
If this is the lowest butter price will move, it would certainly be a victory. However, with butter prices in many countries declining and a lower price on the recent GDT auction, there may be further downside. Exports have been very strong for the first 11 months of last year which has helped to push price to a record high, but high prices cure high prices. Not much change is expected in the near term.
