OPENING CALLS:
| Class III Milk Futures: | 5 to 10 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Mixed |
| Soybean Futures: | 2 to 3 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | 4 to 6 Higher |
MILK:
Class III milk futures extended their gains overnight with the October contract trading above $24.00 again. Traders anticipate block cheese may have found a bottom and will continue higher, narrowing the price gap between blocks and barrels. The USDA will release the August Milk Production report this afternoon and may provide direction for trade through the end of the year. I estimate milk production to be 0.5% below August 2023 and cow numbers to be 3,000 head more than in July. Cow numbers will be the wild card as it is uncertain whether dairy cattle slaughter increased during the month and the available number of replacements.
CHEESE:
It is uncertain whether the decline in barrels on Thursday will be short-lived or if further weakness will continue. The price may show further weakness today due to no buyers showing up to do any business during spot trading on Thursday. The block/barrel spread may narrow again.
BUTTER:
The butter price may hang around the $3.00 level for a while. The market is adjusting to the balance of supply and demand. Churning remains active with cream supplies looser than they had been with multiple prices showing some weakness. Buyers are not concerned about the supply and have purchased ahead of the holiday demand.
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