OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 4 to 8 Higher |
| Butter Futures: | Steady to 1 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 4 to 5 Lower |
| Soybean Meal Futures: | $2 to $3 Lower |
| Wheat Futures: | 4 to 6 Higher |
MILK:
It may be difficult for milk futures to regain the recent losses unless demand increases sufficiently to tighten supplies. The buying frenzy in underlying cash may have run its course for the time being. It certainly was positive that the market had been able to recover the losses that took place in February and March, improving the outlook for milk prices significantly. Milk production is expected to remain strong and above a year ago as milk cow numbers and milk production per cow increase. Hot weather will impact milk output, but we see that each summer to varying degrees. The Federal Order reform is in effect with changes to milk pricing. That will not have any impact on dairy futures, as that has already been factored in.
CHEESE:
Cheese buyers may have reached a threshold of what they are willing to pay for the time being. Cheese production has been steady and will increase as more milk moves to manufacturing. Hopefully, demand will improve to keep supplies from building up.
BUTTER:
The butter price could see further strength with the price recovering from Thursday's losses. The decline may be viewed as a buying opportunity. Butter inventory running 7% below a year ago in April was a surprise and an indication that demand has been performing well. If this trend continues, it will be positive for the price.
