OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 2 to 4 Higher |
| Butter Futures: | Steady to 1 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Lower |
| Soybean Futures: | 2 to 3 Lower |
| Soybean Meal Futures: | $1 to $2 Lower |
| Wheat Futures: | 7 to 9 Lower |
MILK:
Class III futures have moved back to the contract lows in the July and August months. This has dimmed the outlook for milk prices significantly, and with the bearish implication of the milk production report, it may be difficult to see milk prices regain the losses anytime soon, or if at all. Hot weather will impact milk output, but it may not be sufficient to tighten the market. USDA will release the May Cold Storage report on Wednesday and could provide some support if inventory levels remain below a year ago.
CHEESE:
The lower cheese prices should increase buyer interest, but they may not be aggressive if cheese remains readily available. Demand should improve seasonally but will need to exceed last year's level to provide substantial support. Buyers are not concerned about supply at the present time as cheese production is strong.
BUTTER:
The butter market has support, but the price uptrend will not be without retracements. The buying interest on Monday may follow through today as the price moved low enough to cause buyers to step back into the market. Churning remains active, but cream supplies are showing signs of tightening.
