OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 5 to 8 Lower |
| Butter Futures: | 1 to 2 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Mixed |
| Soybean Futures: | 1 to 2 Lower |
| Soybean Meal Futures: | $2 to $3 Lower |
| Wheat Futures: | 2 to 3 Higher |
MILK:
It is anyone's guess as to what underlying cash prices will do today. The pattern has been that any price weakness of cheese has been minimal. Buyers have been willing to purchase more aggressively rather than speculate on whether prices could weaken and offer a better buying opportunity. Traders are cautious over the strength of underlying cash moving forward and there is uncertainty over the level of demand that will be seen. Milk output continues to run below a year ago and the milk production report should show further evidence of that. USDA will release the report on Friday after the closing of the market. It will be interesting to see what cow numbers did in August as the higher milk prices may have increased buying interest for high-priced replacements. However, if that were the case, it does not mean milk production will grow by leaps and bounds anytime soon.
CHEESE:
Cheese prices have more upside price potential based on what has been taking place over the past few weeks. Cheese production is steady with sufficient milk available to keep plants running at a strong pace. Spot milk prices hold a premium of as much as $2.50 over class.
BUTTER:
The butter supply is sufficient with buyers having no difficulty obtaining what they need to fill orders and to increase ownership for upcoming demand. The price declining to the lowest level since June may indicate the top is in. It may be difficult for the price to retest the high of the year. The price may have peaked early this year as buyers have been able to purchase what they need without much difficulty.
