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

The Class III futures posted slight changes in contract prices as the spot cheese session provided little insight to traders during a slower trading day than average. The entire Class III futures complex posted a total of 560 trades as the 2012 contracts gained 8 and 5 cents, while the 2013 contracts settled between 1 penny lower and 5 higher. Market participants will be keeping a close eye on holiday demand as we approach Thanksgiving to provide some additional insight into market direction in the coming days and weeks.

The cheese futures trading session produced minimal price changes in the Nov12 through Feb13 contracts. The November through January contracts posted gains between 0.001 and 0.002 cents, while the Feb13 contract slipped 0.009 cents lower. With both the spot block and barrel markets unable to register a change in price, trading in the cheese futures was subdued. 

The grain complex rebounded from Monday’s losses in another episode of Turnaround Tuesdays as the market awaited the results of the election, while looking forward to Friday’s USDA crop production and supply and demand update. The Argentina corn crop is reportedly only 40 percent planted thus far versus a 60 percent average rate for this time of year, with forecasts calling for more rains which will hamper progress. The effects of Hurricane Sandy have slowed the U.S. soybean harvest with an estimated 100 million bushels still in the fields. The Dec12 corn posted a gain of 5 ½ cents on the day to close out at $7.41, while the Nov12 soybean futures pushed 12 ½ cents higher to $15.16 ¾. 

Today, look for grains to open modestly lower.

Block cheese: $2.11 (unchanged)

Barrel cheese $2.075 (unchanged)

Butter: $1.88 (down 0.5 cent) 

Grade A NFDM: $1.57 (unchanged)

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