OPENING CALLS:
| Class III Milk Futures: | 5 to 10 Higher |
| Class IV Milk Futures: | 5 to 10 Higher |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 3 to 4 Higher |
| Soybean Futures: | 5 to 7 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | 2 to 3 Higher |
MILK:
Milk futures were higher on Wednesday, with overnight trade indicating further strength this morning. Howver, traders will be cautious as the movement of the underlying cash is unpredictable. The overall fundamentals are not supportive of milk prices finding much upside price potential in the near term. It is questionable whether demand will be sufficient to tighten supplies and support prices. Butter and cheese have been unable to find solid support. The support for Class IV futures has been solely from the strength of nonfat dry milk. The U.S. will ban the imports of Canadian whey protein beginning September 29th. Cheese products have been excluded from the ban but will be subject to a 50 percent tariff.
CHEESE:
The block cheese price posted a minor gain on Wednesday, but it is not expected to result in a trend change. Buyers remain unaggressive as they can purchase cheese without having to chase the price higher. Slowly increasing milk production is keeping a sufficient supply of milk for manufacturing cheese, leaving it readily available for demand.
BUTTER:
It is uncertain whether the price will find support, similar to what it did the last time it was at this level. Cash traders do not trade the spot market technically, so that will not influence the market. It will only bounce if buyers turn more aggressive due to the low price. Howver, the upside will be limited as the supply is plentiful.
