OPENING CALLS:
| Class III Milk Futures: | 10 to 15 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 3 Higher |
| Soybean Futures: | 1 to 4 Higher |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 6 to 9 Higher |
MILK:
It appears there is optimism that cheese prices may increase further today due to the buying interest in Class III futures overnight. February through May contracts post double-digit gains. Gains may be limited as traders have not been following either strength or weakness as much as usual due to the choppy nature of the market. Fundamentally, there is little to indicate much strength in the market in the foreseeable future. Milk production is not slowing down. Farms are slowly increasing cow numbers internally. Production per cow continues to outpace a year ago. Spot milk still is being offered at a significant discount to class.
CHEESE:
Buyers of cheese stepped up yesterday to take advantage of the lower prices but many limited their aggressiveness due to supply. Further strength may be seen today as buyers look to rebuild aging programs. However, with current supply, they may only purchase on price weakness.
BUTTER:
Buyers and sellers seem comfortable at the current level. Price may remain in a range for a time as supply and demand seem to be balanced. Increasing butter output may eventually put some pressure on price. Price on the Global Dairy Trade auction yesterday showed a decrease again as there is weakness of international prices.
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