OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 5 to 10 Higher |
| Butter Futures: | 2 to 3 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 4 to 5 Higher |
| Soybean Futures: | 10 to 15 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | 4 to 5 Higher |
MILK:
Traders seem to want to push Class III futures higher despite the weakness of cheese prices. The jump in the butter price Monday provides the psychological support for higher Class III prices. Historically, butter has led market direction. The market fundamentals of higher milk production and increasing cow numbers lend to confusion as to how much strength the market will have. The current level of milk production will keep sufficient milk supplies readily available to the market. Fluid milk demand is strong. Cheese and butter production are running on full schedules. The potential for higher milk prices will spur higher milk production and increased cow numbers. Today is the last day to trade February futures and options. The February Federal Order class prices will be released on Wednesday.
CHEESE:
Buyers have remained unaggressive in the cheese market as the supply is sufficient for demand. Buyers do not need to purchase cheese aggressively due to the available supply. Milk production is increasing seasonally and will provide ample milk for manufacturing.
BUTTER:
The large increase in the butter price was a surprise. Buyers became very aggressive and may continue the buying interest Tuesday based on the unfilled bids remaining at the close of spot trading on Monday.
