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: | 5 to 6 Lower |
| Soybean Meal Futures: | $0.50 to $1 Lower |
| Wheat Futures: | Mixed |
MILK:
Milk futures will wait for direction from the spot market before developing a direction. The substantial volatility early in the week has subsided, with futures more in line with the underlying cash. Traders realized that the strong increase in spot butter and cheese prices was not a true fundamental picture of the market, but rather the result of an unexplained frenzy that I term the "heifer mentality". Dairy farmers can relate to this as they have all seen heifers or any cattle for that matter, become frightened due to one or a few animals beginning to run in a direction. This generates a panic through the herd, triggering a fright, flight response. After running around for a short period of time, the animals stop and look around, wondering why they ran in the first place. This is a correlation to what took place earlier in the week. The fundamentals did not support the strength. The December Agricultural Price report will be released today, providing most of the prices used to calculate income over feed.
CHEESE:
Hopefully, cheese prices will find support and hold. The unfilled bids remaining at the close of spot trading on Thursday would suggest this is a level at which buyers may be more aggressive.
BUTTER:
The butter price has yet to find support. Butter futures were higher at the close as they corrected from being oversold relative to cash. Strong butter production, but lower inventory indicates strong demand. The price may find support near the current level.
