OPENING CALLS:
| Class III Milk Futures: | 8 to 15 Higher |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | 1 to 3 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Steady to 1 Higher |
| Soybean Futures: | 3 to 4 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 3 to 4 Lower |
MILK:
Class III milk futures were higher in overnight trade with double-digit gains in the March through May contracts. The February contract is up a penny and will show limited movement, with the contract mostly priced. The June and later contracts have not traded overnight. The Milk Production report was bearish to the market due to continued strong milk production and higher cow numbers. The Cold Storage report was neutral to cheese and bullish for butter. A reminder that the final day of the signup period for the Dairy Margin Coverage Program is Thursday. Historically, the USDA has extended the signup period, allowing for more time. However, if you intend to take part in the program, make sure you sign up by the deadline, as it may not be extended.
CHEESE:
The block cheese price has increased 27.75 cents since the low set on Jan. 12. This has been an unusual counter-seasonal move. However, it may not be counter-seaaonal, but rather a market correction of the bearishness that prevailed during the fourth quarter of 2025. It just seems counter-seasonal due to the price trend. Buyers have been taking advantage of the lower prices to hedge against higher prices late in the year. Fresh cheese demand has been good, keeping buyers aggressive in the spot market.
BUTTER:
Spot butter may find further support due to the Cold Storage report showing inventory down 17% from a year ago. Inventory increased in January but at a slower pace than last year. Demand has been good and absorbed increased production.
