Block cheese closes unchanged at $1.825

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

Yesterday continued the bottoming formation in cheese prices and futures for Class III and cheese and whey, as well. Perhaps the biggest supporting factor was the increase in GDT cheese.  For some time, we have been talking about the great spread trade opportunities and they are starting to come to fruition as the contraction of them is coming into play.

Volume remained low for Class III, but fell off for the other products, as well, in line with a shortened holiday trading week flooded with reports in a shortened time span. We look for bottoming to continue, but little upside potential for U.S. cheese in the medium term.

While Class III and cheese futures open interest have increased on both up days, we note that yesterday put volume and put OI increased, while call volume declined and call OI declined. This is the only technical factor not overly supportive bullishly at the moment.

The markets will be open today, closed tomorrow (Thanksgiving Thursday) and open until noon on Friday.

Corn right now has really turned on little news other than fear of exports being disrupted out of the Gulf due to low water levels. We think the red line at 765 should provide solid resistance late this week or early next; a bounce above that, however, may push us back toward the 8.00 mark.

We look for the grain complex to open mixed on light volume.

Block cheese: $1.825 (unchanged)

Barrel cheese $1.725 (up 0.25 cent)

Butter: $1.70 (down 2 cents) 

Grade A NFDM: $1.5625 (unchanged)

These data and comments are provided for information purposes only and are not intended to be used for specific trading strategies. Commodity trading is risky and FCStone Group, Inc., INTL FCStone Inc., and their affiliates assume no liability for the use of any information contained herein. Although all information is believed to be reliable, we cannot guarantee its accuracy and completeness. Past financial results are not necessarily indicative of future performance. Any examples given are strictly hypothetical and no representation is being made that any person will or is likely to achieve profits or losses similar to those examples. References to and discussions of exchange traded products are made solely on behalf of FCStone, LLC. References to and discussions of OTC products are made solely on behalf of INTL Hanley, LLC, and OTC products are only available to eligible counterparties.

 

 



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