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 4 Higher |
| Soybean Futures: | 6 to 10 Higher |
| Soybean Meal Futures: | Steady to $1 Higher |
| Wheat Futures: | 4 to 6 Higher |
MILK:
There is not much to be said about the dairy markets. Butter price continues to hold while cheese prices remain bearish, providing no support to milk futures. Sellers continue to bring supply to the market as they are unable to move sufficient product through regular channels. Milk production has been increasing seasonally with further increase possible. USDA will release the April Milk Production report Frid, which will provide an indication of the direction of production. I estimate milk production to be 0.2% above a year ago. I am not making an estimate on cow numbers as there are too many variables. With low milk prices, culling may have increased, setting the direction for reduced cow numbers. The large loss of cows in the barn fire in Texas should be a part of the equation, but how USDA will reflect that is uncertain.
CHEESE:
Prices just cannot find enough consistent buying interest to push the market higher on a consistent basis. The most we can see of underlying strength seems to be two days. This has been ingrained in traders with the result being limited interest in buying futures, even if cash prices show strength.
BUTTER:
Price moved above the top end of the trading range Wednesday but could not find follow-through buying interest during spot trading Thursday. Production is sufficient for demand, leaving the market balanced. Price is not expected to move much Friday.
