OPENING CALLS:
| Class III Milk Futures: | 3 to 5 Lower |
| Class IV Milk Futures: | 4 to 8 Lower |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 4 to 5 Higher |
| Soybean Futures: | 4 to 6 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 16 to 20 Higher |
MILK:
The weakness in Class III futures, despite the increase in cheese prices, was due to short-term profit-taking. This may continue ahead of spot trading Wednesday as traders try to take advantage of price swings. Hot weather is impacting milk production, reducing milk receipts at the plant level. This has some plants reaching out to the spot market for extra milk to maintain production levels. The forecast is for cooler weather later this week, providing some relief to the cows. It will be interesting to see how much milk production may improve after the hot weather subsides. Milk supplies are expected to remain sufficient for demand.
CHEESE:
Cheese prices have been increasing with both blocks and barrels at the highest level since May 13. The barrel price has no part of the Class III price calculation, but it is part of the cheese complex and an indicator of supply and demand. More barrels have been traded on the spot maket the past few weeks than had been traded during the entire first half of the year. Buyer interest is improving.
BUTTER:
The butter price is holding, but not trending higher. Buyers and sellers are comfortable at the current level. Retail demand has been improving. Butter manufacturers have reduced operations to five days a week as cream supplies have decreased. However, no shortage of supply is expected.
