OPENING CALLS:
| Class III Milk Futures: | 4 to 8 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 3 Higher |
| Soybean Futures: | 5 to 7 Higher |
| Soybean Meal Futures: | $0.50 to $1.00 Lower |
| Wheat Futures: | 4 to 6 Higher |
MILK:
Traders did not show a bullish response to the cold storage report but provided general support in the market. The underlying cash prices did not provide direction leaving traders looking for something else to focus on. The milk production report had already been factored in, so attention was on the cold storage report which only provided little support. The focus will be supply and demand moving through the end of the year. The supply of milk will be sufficient but not overwhelming. Milk production per cow is improving with cow numbers holding. The culling rate continues to decrease as farms do not need to cull cows as heavily due to strong prices being received for beef-on-dairy calves. Less expensive feed prices lower the bar on profitability per cow.
CHEESE:
The cheese inventory is below a year ago, but sufficient for demand. Buyers have been complacent as supply is readily available. Demand is seasonally steady but not quite as robust as anticipated. Most contracted orders have been filled or have supplies available to fill orders through the end of the year. This leaves buyers less aggressive on the spot market.
BUTTER:
The butter prices will remain choppy. Retail demand is slowly improving while food service demand is steady to weaker. Butter inventory continues to increase relative to a year ago. The cream supply is heavier than usual for this time of year keeping churns active with some selling extra cream to the market.
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