OPENING CALLS:
| Class III Milk Futures: | 5 to 15 Lower |
| Class IV Milk Futures: | 0 to 10 Lower |
| Butter Futures: | 0 to 0.50 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 4 to 6 Higher |
| Soybean Futures: | 15 to 20 Higher |
| Soybean Meal Futures: | $3.50 to $4.50 Higher |
| Wheat Futures: | 10 to 12 Higher |
MILK:
Class III futures are 12 cents lower on the November contract, the only contract to have traded so far Friday morning. Milk cow numbers continue to grow month after month. Recently, it was reported that one in four feedyard cattle are beef-on-dairy. The strong beef cattle prices have helped keep many farms above water with the extra income received from beef crosses for calves. It has caused a slight drop in cow efficiency as milk production per cow has been trailing lower. This could easily be explained by the fact that a cow producing a calf with low milk production is still better than culling a capable mother. With that, the overall number of cows has brought the sheer volume of milk produced up to a concerning level. The market has shown strength through the innovation of new products and new milk protein demand.
CHEESE:
Overnight Thursday into Friday cheese futures are 0.8 cents lower on the November contract. The drama in the spot market for cheese has been controlling the narrative for cheese and class III futures lately. Thursday happened to be a day sharply lower, while the beginning of the week was noticeably higher. Price sensitivity puts somewhat of a ceiling on what spot buyers are willing to pay to add to holiday inventories.
BUTTER:
Butter has not yet been traded Friday morning. Butter has been lacking some of the holiday demand we have seen in the cheese market. Supplies have been plentiful, so there is no immediate rush to add to inventories. The next cold storage report in less than two weeks will tell more as we head into the baking season.
