OPENING CALLS:
| Class III Milk Futures: | 4 to 8 Higher |
| 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: | 1 to 3 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 1 to 2 Lower |
MILK:
Traders had to cover their short positions in Class III milk futures due to the strong gains in the spot cheese prices. The limited trading activity on the spot market and the unfilled bids that remained suggest further gains today. However, higher prices may increase the interest from sellers to move supply. There is no shortage of cheese as milk production remains higher than a year ago. Bottlers are beginning to plan for the new school year and will increase their need for school accounts over the next few weeks. This is not expected to tighten the milk supply but will balance supply and demand in the cheese market.
CHEESE:
It may be difficult for cheese prices to move back to the levels they had been in May, but further gains are possible as buyers look ahead to later demand. The inventory of cheese is similar to what it was a year ago, indicating a sufficient supply will be available for demand. The Dairy Products report will be released this afternoon, showing the level of cheese production in June.
BUTTER:
The butter price may show further gain today, but the upside may be limited. Buyers see no reason to be concerned over supplies. Demand is not as good as anticipated for this time of year. Butter production is expected to have been higher in June than a year earlier.
