OPENING CALLS:
| Class III Milk Futures: | 15 to 25 Lower |
| Class IV Milk Futures: | 10 to 15 Lower |
| Butter Futures: | 1 to 2 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 6 to 7 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 1 to 2 Higher |
MILK:
June milk production jumped 3.3%, exceeding expectations. The further increase in cow numbers was about as expected, but production per cow exceeded expectations. The impact of bird flu seems to be a thing of the past as milk production continues to increase. Tight heifer supplies and high prices have not impacted the market as expected. Expansions continue to take place and cow numbers are increasing. The surprising aspect is the increase in milk production per cow, as cows that normally would have been culled are exhibiting increased milk production during the next lactation. The growth in milk production this year and the strong increase in June provide a bearish outlook for milk prices.
CHEESE:
Cheese production has been holding steady as the milk supply leaves sufficient available for manufacturing. Demand has not increased as anticipated with buyers complacent as cheese is readily available. The bearish implications of the milk production report will keep buyers sidelined, with buying confined to current needs. Buying for later demand will be done on price weakness.
BUTTER:
The butter price has been trending lower with the price reaching the lowest level since May 30. Some plants are operating on reduced schedules as the cream supply has tightened. Cream prices have increased with spot loads less available. However, steady retail demand and reduced food service demand leave sufficient butter available to the market.
