OPENING CALLS:
| Class III Milk Futures: | 10 to 20 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 4 to 6 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | 2 to 3 Lower |
MILK:
The strength of milk futures on Tuesday is expected to carry over to Wednesday. There is strong potential that the buyers of cheese may remain aggressive as they want to take advantage of the lower prices. If sellers hold back, spot prices will increase. However, the strength may not last long unless the current fundamentals change. Milk production is holding well and is expected to improve through the end of the year. Fall weather is improving cow comfort and feed consumption. Milk output per cow is running above a year ago and the milk production report on Monday is expected to show continued strong production. The milk supply is sufficient for demand, leaving the industry comfortable with the supply of dairy products.
CHEESE:
The strength of cheese prices on Tuesday gives the impression that the market may have found a bottom. Recent history has shown that price increases could be short-lived leaving traders cautious over the upside price potential.
BUTTER:
The volume of butter that has come to the spot market has kept the prices from increasing. The positive aspect is that buyers have been able to absorb the high volume of loads coming to the market. The negative aspect is that sellers continue to offer it even at a lower price. This seems to indicate the market is balanced. Buyers can increase supplies without having to chase the market. This may limit upside price potential.
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