OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | 1 to 2 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 3 to 4 Lower |
| Soybean Futures: | 12 to 14 Lower |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 5 to 9 Lower |
MILK:
The strength in Class III futures was certainly nice to see, but it has a way to move before it regains the level it was about three weeks ago. This is interesting as cheese prices are currently higher than they were at that time. Once the earlier buying frenzy ran its course, the market settled back down. Futures will now move relative to underlying cash as buyers are doing business as they need to. There is concern over the level of milk supply as the year progresses. Much of that will be determined by milk prices. If milk prices rebound further over the next few months, culling may slow as farms will hold onto cows or maybe purchase more cows to fill empty stalls. The seasonal trend of milk production is lower and will remain that way for a time.
CHEESE:
Buyers became more aggressive during spot trading Monday, pushing barrels higher. There may be further buying interest Tuesday. Buyers and sellers of blocks seem comfortable at the current price level, leaving price stable and supported.
BUTTER:
Price is expected to work back up to the previous high as buying interest improves. Butter supply is adequate, but not burdensome. Inventory is expected to decline along seasonal levels as the second half of the year progresses.
