MD_DA230 DA MD DA230 Fluid Milk and Cream Review - Central MADISON, WI. October 13, 2016 (REPORT 41) Milk production is inching higher in the South Central area as the season advances. A few processors in the Southwest noted Central milk loads were offered into that area, but prices kept both sides apart. North Central farm milk production is generally steady. Sales into bottling were tepid early in the week as plant managers adjust for mid-semester breaks within area school districts, however, orders for the end of the week are stronger into a few bottling facilities. The pushback on loads from Class I accounts has freed up some milk volumes to clear into Class III/IV plants. However, a few cheese plant managers have already decreased orders for the week due to component levels rebounding, thus decreasing the need for additional milk loads. At this point, all milk volumes are finding processing room. Class II demands for milk and condensed skim are at seasonally lower volumes. Some holiday related items are queuing up for shipment to retailers. Class II cream multiples firmed after an abundance of cream over the holiday weekend, now ranging from 1.19-1.28. Cream from the West region continues to satisfy some of the butterfat demand in the Central region. Many sellers and buyers are finalizing cream contracts for Q1 of 2017. Some buyers indicate larger cream volumes were offered up for contracting and multiples are generally steady to somewhat lower. This was surprising for some as there are expectations that cream may tighten in the Central region as new churns come online in late 2016/early 2017. On the seller side of the equation, finding a regular home for cream volumes throughout the course of a season at an acceptable multiple is often preferable to canvassing buyers on a weekly basis for spot interest at variable multiples. The DMN National Retail Report-Dairy for October 7-13 noted the national weighted average advertised price for one gallon of milk was $2.38, down $1.10 from a week ago, and down $0.18 from a year ago. The weighted average regional prices in the Midwest and South Central and changes from the previous week are $2.01(- $0.78) and $2.13(-$0.86), respectively. In the North Central area, rain is curtailing fieldwork. Operators are able to get onto high ground fields for corn or soy harvesting, but lowlands are holding moisture and keeping activity to a minimum. In the South Central area, recent rains also slowed harvesting activity in some areas. Recent reports indicate the cotton crop quality may be affected by the rain, but it is unknown at this time how near term cotton seed availability for feed use may be impacted. Winter wheat and oats planting is ongoing. SPOT PRICES OF CLASS II CREAM, $ PER POUND BUTTERFAT F.O.B. producing plants: Upper Midwest - $2.2092-2.3763 1100CT Janet.Linder@ams.usda.gov 608.557.7003 USDA/AMS/Dairy Market News, Madison, Wisconsin Dairy Market News website: http://www.ams.usda.gov/market-news/dairy Dairy Market News database portal: http://www.marketnews.usda.gov/mnp/da-home