OPENING CALLS:
| Class III Milk Futures: | 10 to 15 Higher |
| Class IV Milk Futures: | 10 to 15 Higher |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 3 Higher |
| Soybean Futures: | 1 to 3 Lower |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 4 to 6 Higher |
MILK:
Milk futures defied underlying cash Tuesday, closing mostly higher. This type of action seems to be more frequent. Traders are anticipating a bottom of prices and are either liquidating short positions or increasing their long positions for a price bounce. Overnight trading activity indicates higher milk futures Wednesday unless underlying cash suggests otherwise. Current low milk prices will cause difficulty for cash flow and an extended period of low prices may increase culling. Some farm expenses have decreased from last year while others have increased. Milk output continues to improve as spring flush is taking place. Production continues to remain higher than a year ago.
CHEESE:
The action of cheese prices Tuesday does not suggest prices have found support, but prices are low enough to stimulate greater buying interest. However, prices may stabilize for the time being, possibly moving in a sideways trading range for a period. It is unlikely cheese prices will repeat the strong gains in early March. Buyers of cheese may not be quite as emotional as they were then from fear of continued rising prices.
BUTTER:
Price is not expected to move very much and maintain the sideways trading pattern through spring flush. Ice cream manufacturing is increasing utilizing more cream but sufficient cream remains for butter production, keeping plants operating on full schedules.
