OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Steady to 1 higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 3 Higher |
| Soybean Futures: | 2 to 5 Higher |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 6 to 9 Lower |
MILK:
Some Class III futures contracts made new contract highs Tuesday but could not hold those highs. However, this week continued support from spot prices could move contracts to and through those levels. The better outlook for milk prices will be reflected in the World Agricultural Supply and Demand report to be released Wednesday morning. USDA generally changes its estimated prices based on what the markets have been doing recently. Dairy prices have increased over the past month and USDA will revise their estimates accordingly. They may increase the expectation for milk production as higher milk prices generally spur increased milk output.
CHEESE:
Cheese prices may see limited upside potential in the near term as higher prices will increase selling interest. Cheese production has increased as more milk is moving to the vat. This leaves more cheese for sellers to move and higher prices may increase selling. Eventually, cheese prices may move to the levels they were in mid-May when they were about 10 cents higher than they are currently.
BUTTER:
The butter price may chop around but continue to trend higher over time. International supply is tightening and prices increasing. Domestic retail demand is improving while food service demand holds steady. Churning activity will slow in the coming weeks.
