OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 4 to 8 Higher |
| Butter Futures: | Steady to 1 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 3 Lower |
| Soybean Futures: | 1 to 3 Higher |
| Soybean Meal Futures: | $1 to $2 Lower |
| Wheat Futures: | 1 to 3 Higher |
MILK:
Traders are skeptical over the strength of underlying cash. Futures did not follow underlying cash prices as much as they should have with overnight trade indicating some think the strong price increase of blocks may have run its course. Greater milk volumes are moving to manufacturing now that schools are closed. Milk production continues to improve but spring flush is on the verge of running its course. Hotter weather will impact components and cheese yields. Substantially lower milk prices may increase culling. However, the large Dairy Margin Coverage payment for April of $3.66 per cwt will offset much of the decline for those farms that can take advantage of it. This may limit aggressive culling for a while.
CHEESE:
Some areas report cheese demand has increased slightly. Any increase is welcomed and could trigger further desire in buyers to begin purchasing for upcoming demand. There is sufficient cheese available, keeping buyer interest subdued. The positive aspect is that cheese inventory has not been growing, remaining closely in line with a year ago.
BUTTER:
Price moved above the sideways trading range Thursday with an uptrend potentially developing. Churning has been active but may slow as cream supply tightens during the summer. Retail and food service demand is steady. If butter trends higher, cheese prices may follow.
