OPENING CALLS:
| Class III Milk Futures: | 5 to 10 Higher |
| Class IV Milk Futures: | 5 to 10 Higher |
| Butter Futures: | Steady to 1 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Steady to 1 Higher |
| Soybean Futures: | 2 to 4 Lower |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 3 to 5 Higher |
MILK:
Class III futures showed strength into the close even though cheese prices showed weakness. The fact that futures have not kept up with the increase of cash and that the weakness of cheese yesterday was limited, provided support to the market. Underlying cash prices could chop around for a time as traders sort the implications of the July Milk Production report and the upcoming Cold Storage report. Hot weather this week will have a definite impact on milk output as cow comfort will be challenged. Milk supply to manufacturing has decreased due to lower milk receipts and more milk moving to bottling for school accounts. Milk is moving from the Midwest to the Southeast leaving limited spot milk available and holding a premium to class. Overnight trading activity points to higher futures moving into today.
CHEESE:
It is uncertain how aggressive cheese buyers will be at these levels. Sufficient cheese is available leaving little concern for supply. Cheese production has slowed due to less milk, but plants continue to run on strong schedules. The July Cold Storage report will be released tomorrow and is expected to show cheese inventory slightly lower than a year ago.
BUTTER:
Price may chop around near the current level for a period. The market is balancing supply and demand both domestically and internationally. Export demand has been slow with the current price significantly higher than the world price. This may limit upside price potential. Churning has slowed due to less cream supply.
