OPENING CALLS:
| Class III Milk Futures: | 2 to 5 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Steady to 1 Lower |
| Soybean Futures: | 3 to 5 Higher |
| Soybean Meal Futures: | $0.50 to $1 Higher |
| Wheat Futures: | 4 to 5 Lower |
MILK:
Class III milk futures found strength from Monday's increase in spot cheese prices. The October contract is knocking on the door of $21.00 with the overnight price ranging from $20.84 to $20.96. October made a new contract high on Monday, keeping the uptrend intact. The USDA will release the June Milk Production report Tuesday afternoon. I estimate milk production to be 0.8% below a year ago. The change in cow numbers from May will be the wild card. Dairy cattle slaughter has been slowing, which could indicate cow numbers may have increased from May. Lower feed prices may have farms holding onto cows as the outlook for milk prices has improved. There will be no Dairy Revenue Protection prices released today.
CHEESE:
Cheese prices are expected to remain choppy and have yet to break out of a range. Demand should slowly improve as the summer progresses and buyers look ahead to upcoming demand. There is little concern over a supply shortage, even though milk production is slowing. More emphasis on cheese production seems to be moving toward other cheese varieties rather than American cheese as indicated by the dairy products reports.
BUTTER:
The butter price holding on Monday may indicate sellers are unwilling to offer butter any lower. This may increase the buying interest on the spot market as buyers want to take advantage of the lower price.
