OPENING CALLS:
| Class III Milk Futures: | 5 to 10 Lower |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Higher |
| Soybean Futures: | 4 to 6 Higher |
| Soybean Meal Futures: | $0.50 to $1 Lower |
| Wheat Futures: | 5 to 7 Lower |
MILK:
Overnight trading activity indicates further pressure may be put on milk futures ahead of spot trading. There is concern the block cheese prices will see further weakness as buyers hold back to see how aggressive sellers will be. Strong milk output is expected to continue keeping sufficient milk available for bottling and manufacturing. Expansions continue to take place and cow numbers are increasing. The recent weakness in calf prices may have little impact on the desire to increase cow numbers. The overall cattle market remains tight, and the recent weakness in beef prices is expected to be temporary. The U.S. border will be reopening for cattle imports from Mexico beginning in late August, but those imports will not overwhelm the market anytime soon. Expansion of dairy processing facilities continues as milk production is expected to trend higher.
CHEESE:
The block cheese price may see further weakness. Only sellers showed up during spot trading on Monday. Buyers may hold back to see how aggressive they will be. The supply of cheese is expected to remain readily available for demand as milk production remains strong.
BUTTER:
It is uncertain where the butter price will find support. The large amount of uncovered offers remaining at the close of spot trading on Monday suggests further weakness unless the sellers will not offer the supply at a lower price. If not, it would indicate the upside price potential is limited for the time being.
