OPENING CALLS:
| Class III Milk Futures: | 8 to 15 Higher |
| Class IV Milk Futures: | 5 to 8 Higher |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 6 to 8 Higher |
| Soybean Meal Futures: | $1 to $2 Lower |
| Wheat Futures: | 1 to 2 Higher |
MILK:
Greater volatility is being seen in milk futures, but it has not accomplished much as far as price direction is concerned. There had been a substantial increase in prices over a week ago, but that has since settled down to the levels the futures were before the volatility. Strong milk production does not support strong milk prices. Replacement heifer supplies continue to tighten as shown on the Cattle Inventory report, but it has not impacted the increase in cow numbers. Milk production remains strong and so does the production of dairy products. Milk futures were overdone to the downside on Monday and are now correcting to move in line with the spot market until spot trading shows further direction.
CHEESE:
It is uncertain whether cheese has found a higher level of support or if this is just temporary. Higher prices may be difficult to support unless there is increasing demand. Strong milk production keeps sufficient milk available for cheese production. Buyers show little concern over a tightening market.
BUTTER:
The demand for butter has been stronger than had been anticipated. Retail and export demand has been strong. However, demand from food service remains less than desired and expected. The current price level should be supported, but the upside potential may be limited over the next few months.
