OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 2 to 5 Lower |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 2 to 3 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | 1 to 3 Lower |
MILK:
The volatility in block cheese on Tuesday caused traders to question whether the market will trend higher or settle into a sideways trading range. It seems Class III futures overreacted to the price swing as the end result was only a loss of a penny. However, traders may step back until cheese prices become less erratic. Milk production is sufficient for demand with any extra milk available commanding prices above class on the spot market. The January contract is mostly priced by the trade and may see limited movement on a daily basis. The price will correct, based on the weekly AMS prices released on Wednesday afternoon.
CHEESE:
It is clearly seen that buyers want to take advantage of a dip in prices while sellers take advantage of higher prices. It is interesting that the volatility in spot block trading on Tuesday was the result of only two loads traded. Cheese prices may move in a sideways range for a time.
BUTTER:
The trend is up in butter, but it may be a slow increase. Buyers have been able to purchase what they need without having to chase the market. Cream supply remains abundant keeping churn active and butter available for demand. Some is being added to inventory to ensure a cushion of supply in case the availability of milk tightens as the year progresses.
