OPENING CALLS:
| Class III Milk Futures: | 2 to 5 Higher |
| Class IV Milk Futures: | 2 to 5 Higher |
| Butter Futures: | 1 to 2 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Lower |
| Soybean Futures: | 5 to 8 Higher |
| Soybean Meal Futures: | $3 to $5 Higher |
| Wheat Futures: | 7 to 10 Lower |
MILK:
Both Class III and Class IV milk futures were able to post gains Tuesday. The strength of butter provided support to the market. Class IV futures should have gained more in relation to the jump in butter price, but traders are being very cautious at the record-high butter price, increasing the risk of price holding at the current level. Milk production remains steady at seasonally lower levels. Milk supply to the school systems is steady. Manufacturing milk supply is sufficient, but not burdensome. Spot milk is tighter with prices running as much as $1.00 over class. Class IV futures moving higher are supported by butter, but also by some recent strength of nonfat dry milk. Nonfat dry milk price has reached the level last seen in early May which is providing added support. However, price has not yet broken out to the upside. USDA will announce the September Federal Order class prices Wednesday afternoon. They will also release the August Dairy Products report.
CHEESE:
The Global Dairy Trade auction Wednesday did not provide solid support for the cheese market as the trade weighted average declined 4.8%. The only other category posting a loss was lactose down 1.3%. All other categories showed nice gains. Cheese buying should increase in October, but the increase may be limited.
BUTTER:
Price has moved into nosebleed territory and shows no sign of stopping. The brief decline Friday was thought to indicate a top had been reached. However, the rebound Monday and the aggressive increase Tuesday point to the potential of further gain.
