| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 4 to 8 Lower |
| Butter Futures: | Steady to 1 Lower |
| Corn Futures: | Mixed |
| Soybean Futures: | 4 to 6 Lower |
| Soybean Meal Futures: | $1 to $2 Lower |
| Wheat Futures: | 1 to 2 Lower |
Milk futures have been unable to find a bottom and have not even been able to bounce over the past few weeks. Class IV futures have shown greater weakness than Class III. Even if underlying cash shows strength, traders may cover some short positions. They might not buy into the market as the upside price potential may be limited unless underlying cash prices develop a higher trend. It is not that there is an overabundance of milk, but a decrease in demand compared to a year ago. Milk production is sufficient for demand and being higher in January than a year ago may indicate further gains over the next months.
CHEESE:The block cheese price has maintained a sideways range while barrels have been trending lower. Buyers have not been aggressive as they do not want to build inventory too early as they are uncertain about demand. Much of the buying is being done on an as-needed basis. Cheese inventory is expected to have increased in January. The January Cold Storage report will show how much.
BUTTER:It is uncertain where support is in the butter price. The low bid of $2.20 during spot trading on Tuesday is cause for concern. There was no interest in buying any higher. This may have just been due to limited interest in the spot market for the day, but it could also indicate the next level of support. Buyers may step in at higher levels to purchase supply to increase ownership in case supply tightens as the year progresses.
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