OPENING CALLS:
| Class III Milk Futures: | 3 to 6 Lower |
| Class IV Milk Futures: | 4 to 10 Lower |
| Butter Futures: | 1 to 2 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 3 Higher |
| Soybean Futures: | 6 to 8 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | 7 to 9 Higher |
MILK:
Milk futures have been under pressure with Class IV showing the greatest weakness. The decline in nonfat dry milk has resulted in futures falling back to the lowest level since Jan. 23. This does not bode well for milk prices for a time -- or even the rest of the year. There is no slowing of milk output so far this year and it is not expected to decline anytime soon. Price strength is short-lived as the underlying cash prices remain choppy. The June Class IV contract showed unusual trading activity overnight. There were 30 contracts traded and the price increased a penny. It is unusual because Class IV futures rarely trade overnight, and the volume taking place in June is surprising. The June contract is mostly priced and may move very little from now until the Federal Order prices are announced.
CHEESE:
Cheese prices are not expected to move much. Any price strength will be short-lived. Cheese supplies are sufficient for demand with strong production due to milk availability. Buyers have not been purchasing for later demand as they have little concern over supply.
BUTTER:
There is concern that butter price may move back to the low again before buying interest supports the market. Buyers may hold back to wait for sellers to reduce their prices. Nonfat dry milk is expected to show further weakness.
