OPENING CALLS:
| Class III Milk Futures: | 2 to 6 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Mixed |
| Soybean Futures: | 3 to 5 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 1 to 2 Higher |
MILK:
Class III milk futures did not find support from the increase of barrels Tuesday. Traders remained cautious as the market showed no specific trend. Much of the trading activity is short-term as traders scalp the market to try to make some profit. This may continue as long as the underlying cheese prices remain choppy. Class IV futures showed some weakness due to a steady butter price and weakness in nonfat dry milk. The overall market seems to be balanced, keeping cash prices sideways. The June Federal Order class prices will be announced Wednesday. The trade anticipates a Class III price of $19.90 and a Class IV price of $21.15. USDA will release the May Dairy Products report Wednesday afternoon, showing the production level of dairy products during the month. The markets will be closed on Thursday in observance of Independence Day.
CHEESE:
Cheese prices remain in a sideways pattern. Cheese production is strong and meeting demand. Inventory is slightly lower than a year ago but still sufficient to meet demand with no concern over supply. Demand is reported to be improving and should continue to support prices. Spot milk remains available to manufacturers at prices slightly under class.
BUTTER:
The butter prices may reach back up to the recent highs as retail demand remains strong. Cream supply is tightening due to reduced milk production and the butterfat content of milk. Class II products are utilizing increased cream volumes for production providing more competition for supply. Plants are planning periods of downtime to much needed maintenance. Butter output will be reduced with inventory being used to satisfy demand.
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