OPENING CALLS:
| Class III Milk Futures: | 4 to 8 Lower |
| Class IV Milk Futures: | Steady to 5 lower |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 7 to 10 Lower |
| Soybean Futures: | 12 to 20 Lower |
| Soybean Meal Futures: | $4 to $6 Lower |
| Wheat Futures: | 6 to 9 Lower |
MILK:
There seems to be no hope for the milk market with July about 55 cents below where June finished trading Tuesday. The overnight market showed stability in July, but that is little consolation as the underlying cash remains weak. With milk production in May up 0.6 percent and only nine of the top 24 states showing production declines, it indicates milk supply may be heavy for a longer time. There are reports that culling has increased significantly in June, which may reduce milk supplies as we move through the summer. The question will be the level of replacements that are available that may offset some of the culling. Hotter weather in July and August should also provide some reduction in milk output. It seems more pressure will be evident on milk futures unless underlying cash makes a significant rebound. USDA will release the June Federal Order class prices Wednesday.
CHEESE:
The weakness of cheese keeps buyers lowering bids. Sellers need to move cheese and will lower offers to accomplish that purpose. Cheese production remains strong as milk supply is abundant. Heavy cheese output leaves an abundant supply of dry whey, resulting in lower price and heavy trading volume on the spot market.
BUTTER:
One could say butter is the bright spot as price continues to remain in a range. However, with inventory increasing and exports slow, there is little reason to believe price will break out of the range anytime soon. The market may remain choppy.
