OPENING CALLS:
| Class III Milk Futures: | 4 to 9 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 3 to 8 Higher |
| Soybean Meal Futures: | $3 to $5 Higher |
| Wheat Futures: | 3 to 5 Higher |
MILK:
It seems traders are thinking milk futures might move higher as underlying cash may find support. However, even though there may be some positive things taking place that could support the market, it may take some time before trader sentiment may change. This will keep traders trading on a short-term basis as they try to take profits out of the choppy market rather than take a long-term position. Class IV futures are more reactive to the movement of nonfat dry milk than butter recently. USDA will release the World Agricultural Supply and demand report Wednesday which will provide their estimates on milk production, milk price and product prices for this year. I think it will be similar to the January report as little has changed in the market since then.
CHEESE:
Cheese prices are having a difficult time finding a reason to trend higher. The decline of barrel price Tuesday matches the low from Jan. 20. If price declines Wednesday, it moves to the lowest level since Sept. 2, 2023. Fundamentals do not look very supportive at the present time as there is sufficient supply for demand and inventory is building.
BUTTER:
Price has been in an uptrend recently as buyers have been taking advantage of lower prices to purchase supply for later in the year. It is possible that higher prices will increase the selling interest as manufacturers want to limit inventory growth at the plant level. Churning is active with many plants running on seven-day weeks. Price may be nearing a threshold again.
