OPENING CALLS:
| Class III Milk Futures: | Steady to 5 Lower |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 3 Higher |
| Soybean Futures: | 7 to 9 Higher |
| Soybean Meal Futures: | $2 to $4 Higher |
| Wheat Futures: | Steady to 2 Higher |
MILK:
Some pressure might continue in nearby Class III futures as traders will be cautious over spot cheese trading. A good amount of trading activity in the spot market Tuesday provided support to differed Class III contracts. There were only uncovered offers remaining at the close Tuesday, suggesting spot cheese could be under some selling pressure Wednesday. Buyers may hold back for lower prices. This would put further pressure on Class III futures. Current fundamentals do not suggest much upside price potential as milk production remains higher than last year. The heavy rains in California continue to be in the news and will have some impact on milk production and movement, which may provide psychological support to the market until an assessment of impact on milk supply is done. Milk futures could move in anticipation, adding some premium to later contracts.
CHEESE:
It was a bit surprising cheese prices did not fall back more than they did Tuesday and that buyers were active at the higher prices. Further weakness could be seen Wednesday as buyers might hold back to see how aggressive sellers will be. Sellers see little reason to hold and speculate on higher prices due to strong cheese production and readily available supply.
BUTTER:
Buyers and sellers are content with the current price with little reason to move it one way or the other. Business is being done without an oversupply or an undersupply. Churning is active, keeping sufficient supply on the market. Demand is slower but continues to remain good.
