OPENING CALLS:
| Class III Milk Futures: | 5 to 8 Higher |
| Class IV Milk Futures: | Steady to 5 Higher |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 3 to 5 Higher |
| Soybean Futures: | 9 to 12 Higher |
| Soybean Meal Futures: | $3 to $4 Higher |
| Wheat Futures: | 5 to 7 Higher |
MILK:
Milk futures are not likely to push significantly higher in anticipation of stronger underlying cash, but will react to the movement of the cash market. There are supportive fundamentals in the market, but traders are remaining cautious over the extent of the potential in the near term. Demand is the concern moving through the early part of the year. Milk production is lower than a year ago, but if demand is slower, it will limit the upside price potential. Cow numbers are higher than a year ago providing the potential for strong increases in milk output, but the continued impact from tight heifer supplies and bird flu may be limiting factors. The November Dairy Products report will be released Monday afternoon. It will not have much influence on the market.
CHEESE:
Cheese prices are expected to remain supported but may have limited upside potential for the time being. Traders will balance supply with demand. Buyers may not be very aggressive as they see sufficient milk for manufacturing. It is too early in the year for buyers to purchase cheese to build inventory unless they see a strong increase in demand.
BUTTER:
Business is being done at the current price level without buyers having to chase the market higher. However, the market is in a similar posture as last year, which could result in slow and steady gains as the year progresses. The current market is expected to remain choppy and in a sideways pattern.
