OPENING CALLS:
| Class III Milk Futures: | 4 to 8 Lower |
| Class IV Milk Futures: | 4 to 10 Lower |
| Butter Futures: | Steady to 1 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | Steady to 1 Higher |
| Soybean Meal Futures: | $1 to $2 Lower |
| Wheat Futures: | 4 to 5 Higher |
MILK:
Traders indicate they believe cheese prices may be near price resistance. Class III milk futures were lower despite stronger block cheese and steady barrel prices on Wednesday. Some of the pressure may be due to the expectation that milk production will continue to remain significantly above a year ago. I estimate July milk production to be 2.9% above a year ago, with cow numbers to be 4,000 head more than in June. Less expensive feed prices and high milk replacement prices should keep farmers holding onto cows. If milk output in July was strong, the potential for continued strength the rest of the year is certain.
CHEESE:
The block cheese price is 1.25 cents from the previous high of last week. The price may have difficulty moving above that level as sellers may take advantage of the higher price to move more cheese to the market. However, seasonal buying could provide support and push the price back to the high of early June.
BUTTER:
The butter price continues to struggle and could retest the low of 2.28 set on Aug. 14. A break below that level would move the price to the lowest level since April 29. The price has been moving counter-seasonally due to continued strong butter production throughout the year. The July Cold Storage report will be released on Friday and is expected to show increased inventory from July 2024.
