OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 3 Lower |
| Soybean Futures: | 4 to 5 Lower |
| Soybean Meal Futures: | $2 to $3 Lower |
| Wheat Futures: | 5 to 6 Lower |
MILK:
The October Milk production report showed continued strong milk output that will keep the market supplied. However, lower milk prices may impact cow numbers as they declined by 7,000 head from September. This is the first month-over-month decline in cow numbers since December 2024. The income received from beef-on-dairy calves may not be sufficient to maintain cash flow, with lower production cows now being culled to reduce expenses and supplement income. However, strong milk production is expected to continue into next year. The dairy markets will have a short week with trade only taking place through Wednesday.
CHEESE:
Spot cheese prices are expected to continue to struggle as there is sufficient milk available for production. Spot milk is not tight, and more will be available this week as schools close and more fluid milk moves to the spot market. Cheese plants will remain on full schedules to handle the milk. The milk production report indicates continued strong milk production that might build inventory more rapidly through the first half of next year.
BUTTER:
The August Dairy Products report showed strong butter production and likely is the reason why the butter price is so low. We will eventually see the September and October reports as the USDA catches up after the shutdown; but strong production has continued due to heavy cream supplies. Low butter prices are expected to continue through the end of the year.
