OPENING CALLS:
| Class III Milk Futures: | 3 to 8 Lower |
| Class IV Milk Futures: | 4 to 8 Lower |
| Butter Futures: | 1 to 2 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Steady to 1 Higher |
| Soybean Futures: | 4 to 6 Higher |
| Soybean Meal Futures: | $2 to $6 Higher |
| Wheat Futures: | 1 to 3 Higher |
MILK:
There was little change fundamental over the extended weekend or for the past while for that matter. Underlying cash prices are not expected to change much in the near term. If cash prices remain where they are, later Class III futures contracts will need to roll down eliminating any premium they might contain relative to cash. Class IV will do the same if butter price falls further through the end of the year. Buying interest of underlying cash is not likely to develop anytime soon if milk production remains at current levels. Milk components are improving which is allowing for increased cheese yield and increased cream supply.
CHEESE:
Cheese prices were at this level in July as they rebounded from the low in June. Hopefully, demand will be strong enough to result in another rebound as lower prices may increase demand. However, the time of year is not favorable as demand generally slows in the early part of the year.
BUTTER:
It is uncertain whether butter price has found a bottom. It is nearly at the level at which the price remained in a sideways range for the first half of the year. This could be where the market will find value moving into the next year. However, if the price pattern is repeated, it would mean price may decline further before reaching that level.
