OPENING CALLS:
| Class III Milk Futures: | 5 to 10 Higher |
| Class IV Milk Futures: | 5 to 10 Higher |
| Butter Futures: | 2 to 3 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Mixed |
| Soybean Futures: | 3 to 5 Lower |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 2 to 3 Higher |
MILK:
The large decline in the barrel cheese price was disheartening, but traders seemed to think this may be the bottom. Class III milk futures increased substantially with traders likely short covering on the anticipation that the market is overdone to the downside. Traders may be willing to step in and take a chance that cash prices will rebound this week. The Agricultural Prices report showed lower grain and hay prices, but a higher All-Milk price. This resulted in an August income over feed price of $13.72. This is the highest income over feed price since the MPP program began in 2015 which then became the DMC program.
CHEESE:
The 15-cent decline in the barrel cheese price was the largest one-day decline since November 16, 2020. The barrel price has nearly fallen to the level of blocks. It would seem the decline has been overdone, providing an opportunity for buyers to increase their ownership of supply for increasing demand through the end of the year. Barrels finally saw loads traded, providing some hope of a price bottom.
BUTTER:
Buyers took advantage of the lower price and turned more aggressive. Sellers did not step back but sold butter as the price increased. They needed to move some butter and were unwilling to speculate on how aggressive the buyers would be. The upside price potential may be limited.
