OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Lower |
| Soybean Futures: | 2 to 4 Lower |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 4 to 6 Lower |
MILK:
The outlook for milk prices has improved and the desire will be to increase milk production. That does not take place overnight, but is generally the reaction to a positive market outlook. A tighter heifer supply may be a limiting factor for increasing cow numbers. Improving production per cow would increase milk supply. If the current level of milk production is maintained and demand for dairy products improves, milk prices could move much higher. The discovery of bird flu in dairy cattle has not impacted the industry and has now become old news. Spot prices and milk futures increased substantially shortly after it was discovered. Consumers felt confident there was no threat to the food supply.
CHEESE:
The slight weakness of cheese does not indicate prices have reached a threshold. Buyers just were not aggressive Tuesday. It seems there may be a growing concern over milk supply later in the year, which may increase the buying interest in dairy products now rather than later.
BUTTER:
Price is expected to hold above $3.00 as the market is supported by demand. Buyers are looking ahead and are purchasing and storing for later demand. Manufacturers have maintained strong production levels and are building a supply cushion. The Global Dairy Trade auction showed a stronger butter price, indicating world demand may be improving.
