Editor’s note: This market commentary is provided by the Dairy Division at FCStone in Chicago, Ill.

 With the spot market mixed (blocks down 2.5¢, but barrels 3¢ stronger), futures had little choice but to rally to close the gap. Spot equivalents are valued right at $22.00/cwt., while March finished March 11’s session at $20.99/cwt., even after rallying a sharp 49¢. Class III futures prices in other first-half months were 10¢ to 27¢ higher, while deferred futures pushed higher by 4¢ to 18¢ from July all the way through April 2015. Cash cheese futures mostly tagged along with the Class III market. Whey futures volume pulled back after yesterday’s heavy activity.

The class IV market found some support from the higher class III trade, but not too much. NFDM futures were mixed but mostly lower yet again.  Spot butter prices were unchanged yesterday, and that left futures to rally to close the gap.


Feb. 11 spot session results:

Block cheese: $2.1050 (down 2.5¢)

Barrel cheese: $2.18 (up 3.0¢)

Grade A NFDM:  $2.0475 (up 3.0¢)

Butter: $1.7650 (unchanged)


Today's expectations:

• Class III & Cheese to open higher

• Dry whey to open mixed

• Class IV, Butter & NFDM to open slightly higher


Grain futures

It was a wild day for the grain markets, with the soybean market rebounding from overnight double-digit losses to post nearly double-digit gains. the corn market lagged. The anticipation of export sales seems to be the continual carrot for the bulls.


Today’s expectation:

• Grains to open slightly lower


The trading of derivatives such as futures, options, and swaps may not be suitable for all investors. Derivatives trading involves substantial risk of loss, and you should fully understand those risks prior to trading. Any reference to past performance is not indicative of future results. All references to futures/options trading are made solely on behalf of FCStone, LLC. All references to swap execution and bi-lateral swaps are made solely on behalf of INTL Hanley, LLC. FCStone, LLC will clear swaps when applicable. Swaps are only available to eligible counterparties. All observations of economic, political and/or market conditions are not intended to refer to any particular trading strategy, promotional element or quality of service provided by INTL FCStone Inc. and its subsidiaries and should be construed as market commentary. All recommendations to buy or sell a specific derivative or forecasting statements regarding market activity and the pricing thereof should be construed as a solicitation in any jurisdiction in where such an offer or solicitation would be legal. Proper context and guidance including but not limited to the particular trading objectives, financial situations and the needs of the intended audience were taken into consideration when this recommendation was prepared. Contact your account representative for specific advice to meet your specific trading preferences or goals. These materials represent the opinions and viewpoints of the author, and do not necessarily reflect the viewpoints and trading strategies employed by INTL FCStone Inc. and its subsidiaries. Sources of information believed to reliable were used in preparing such observations, and no guarantee or representation regarding the accuracy of those sources has been made. INTL FCStone Inc. and its subsidiaries are not responsible for any redistribution of this material by third parties, or any trading decisions taken by persons not intended to view this material.