OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Mixed |
| Soybean Futures: | 3 to 4 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | Mixed |
MILK:
It is a new year, but not much is expected to change in the near term. Overall milk production has been steady to higher, although it is running below a year ago. Bottlers will resume production for school accounts as schools return after the holidays. The market is heading into a period of slower demand, which may leave the prices with limited upside potential unless the milk supply tightens more than expected over the next few months. Overnight trading activity in milk futures was unusual with over 50 contracts traded in January Class III and 18 contracts traded in February. General, trading is very light after an extended weekend. FSA has yet to release the average soybean meal price for November and should be released this morning. This will provide the price needed to calculate income over feed for the Dairy Margin Coverage program. The Global Dairy Trade auction will take place Tuesday.
CHEESE:
There is no change expected in the choppiness of cash trading as we move through the new year. Overall demand is generally slow over the next few months, but each year is different. We have seen strong prices develop early in the year based on supply and demand or the perception of what is to come. We have seen limited price potential based on lower demand. Currently, the outlook is for limited upside price potential.
BUTTER:
Price is not expected to have much upside potential in the near term as churning has been active due to plentiful cream supplies. This will provide sufficient supply for demand. Some of the expected demand for the first quarter has already been anticipated and contracts already filled, which may leave buyers less aggressive in the near term.
