OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 4 Lower |
| Soybean Futures: | 3 to 5 Lower |
| Soybean Meal Futures: | $1 to $2 Lower |
| Wheat Futures: | 1 to 3 Lower |
MILK:
We would like to think that milk futures are oversold, but the dairy futures market is not the same as other markets, as milk futures reflect what takes place in the underlying cash market. Hopefully, the May Cold Storage report will provide some support to offset the bearishness since the milk production report. Traders have little to get excited about as the underlying cash cheese prices have fallen near the lows from March. Milk production has not shown signs of slowing, keeping sufficient milk available to the market and the potential for it to remain that way. Overnight trade showed further pressure on milk futures as traders see little hope for much upside near term.
CHEESE:
Buyers have been willing to purchase cheese but only on price weakness. The large volume of blocks traded on Tuesday indicates cheese manufacturers want to move supply to limit inventory build at the plant level. They have no intention of holding inventory for higher prices.
BUTTER:
The cold storage report will be watched for the level of butter stocks compared to a year ago. If inventory continues to run below a year ago, it may trigger increased buying interest on the spot butter market.
