OPENING CALLS:
| Class III Milk Futures: | 4 to 8 Lower |
| Class IV Milk Futures: | 5 to 10 Lower |
| Butter Futures: | Steady to 1 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 5 to 8 Higher |
| Soybean Futures: | 4 to 6 Higher |
| Soybean Meal Futures: | $3 to $4 Higher |
| Wheat Futures: | 16 to 20 Higher |
MILK:
There seems to be little support in the market as traders remain bearish and buyers of the physical commodity remain complacent. June is moving near the $15.00 level. This contract has about two weeks until it is priced, and underlying cash will have no impact on it anymore. Each day, the chances of a rebound are reduced. July is wide open for price movement and hopefully will not fall to the level of the June contract. Milk production continues to remain strong. Many areas of the country were able to harvest excellent forage, which should reduce protein costs and keep milk production strong. However, many areas had less of a crop due to dryness. There is concern over current dryness in many areas and subsequent forage harvest.
CHEESE:
Block cheese price was unable to retain the gains in early spot trading but was able to hold steady. Barrels closed higher, but none of that had any impact on Class III milk futures. Traders focused on the inability of blocks to hold gains, indicating limited upside for prices. Sellers continue to offer supply on the spot market as they want to limit building inventory at the plant level.
BUTTER:
The weakness of butter Monday indicates price is not yet ready to break out and trend higher. Supply is sufficient and buyers complacent. Some contracting is being done for the fourth quarter, which may limit upside potential as buyers will have a good portion of expected demand for the end of the year already covered.
