OPENING CALLS:
| Class III Milk Futures: | 5 to 10 Lower |
| Class IV Milk Futures: | 5 to 10 Lower |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 3 Higher |
| Soybean Futures: | 2 to 4 Lower |
| Soybean Meal Futures: | $2 to $3 Lower |
| Wheat Futures: | 8 to 12 Higher |
MILK:
Milk futures were lower for the week, which may keep traders cautious early this week. The block/barrels spread may narrow further as buyers and sellers settle down to reality rather than perception. The milk production report showed production in April below a year ago but better than expected for the month. The same may hold for May as the weather has been good and milk prices showed much promise. Schools have closed and will close over the next week with more milk available for manufacturing. This is not expected to pressure prices but could limit upside potential near term.
CHEESE:
The April Cold Storage report was not bearish on the market, but may not support prices. The lack of inventory growth for cheese compared to a year was expected. This indicates supply and demand have been balanced and the current spot prices justified. Cheese production will increase and it will be up to demand whether prices will increase as the year progresses.
BUTTER:
The butter increase on the Cold Storage report was expected and not burdensome. Churning was active with plants utilizing the higher cream supply to build inventory and provide a cushion of supply ahead of the summer when the cream supply would tighten. Retail butter demand is improving with mixed demand in the food service industry.
