Friday Morning Dairy Market Update - Further Pressure on Class IV Futures Expected

OPENING CALLS:

Class III Milk Futures:	4 to 10 Lower
Class IV Milk Futures:	5 to 10 Lower
Butter Futures:	Steady to 1 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 4 Lower
Soybean Futures:	5 to 7 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	2 to 4 Lower

MILK:

Class III futures will remain volatile as traders attempt to guess what the underlying spot cheese prices will do. The hope is to take a quick profit out of the market by taking advantage of the price swings. This creates more volatility as traders are not establishing long-term positions. There are indications that milk has tightened in some areas, but that has not impacted the market as there is sufficient milk for demand. Class IV futures are expected to see further pressure as butter prices weaken.

CHEESE:

Cheese prices are expected to be choppy with little price direction. Buyers show little interest in purchasing supplies to build inventory. Cheese production is sufficient for demand with inventory expected to increase over the next months.

BUTTER:

The butter price is expected to show further weakness as the abundant cream supply keeps churning active. There is no indication of a level of support in the market. Buyers are purchasing as prices decline satisfying current demand and building supply for later. This will keep the butter price lower or lower for the foreseeable future.