OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | 1 to 3 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 3 to 5 Lower |
| Soybean Meal Futures: | Steady to 1 Higher |
| Wheat Futures: | Mixed |
MILK:
There was very limited activity overnight in milk futures. Traders may take a wait-and-see attitude, needing further direction from the underlying cash before feeling confident about the price direction. The bearish implications of the milk production report were not evident on Monday, but may surface Tuesday if there is weakness in the spot market. It is uncertain how much the hot weather will impact milk production in the West and Southwest regions. The rest of the country will see increased evidence of the spring flush as cow comfort improves. USDA will release the February Cold Storage report Tuesday afternoon. The report is expected to show an increase in inventory, but the increase may be less than usual for the month.
CHEESE:
The weakness of the block cheese price on Monday may keep traders cautious Tuesday. Class III milk futures close higher despite the weakness, but another day of weakness might trigger significant selling. Increasing cheese production and continued strong milk output may limit the upside price potential.
BUTTER:
The butter price has yet to find solid support. Buyers have been able to purchase a substantial amount of butter on the spot market. This is satisfying current demand and allowing buyers to build inventory. However, inventory is lower than a year ago as the increase is less than usual. This indicates solid domestic and international demand.
