MD_DA230                                                              
DA                                                                    
MD DA230   Fluid Milk and Cream Review - Central                      

MADISON, WI.  November 17, 2016 (REPORT 46)                           

Central region milk production is slowly trending upward, with accompanying 
increases in butterfat and protein component levels. Within the region, milk 
producers indicate they are content to keep cows on hand, instead of culling, 
as long as facilities have room, feed is available and prices on the cull cow 
market stay low. Milk supplies are uneven and there is active movement of milk 
loads within the region. In some areas, milk is well short of keeping 
production facilities running at capacity. However, some organic milk is 
clearing into the conventional market as there is an oversupply of organic milk 
for current needs in some areas. Condensed skim and ultra-filtered milk loads 
from outside the Central region are also actively clearing to Central Class III 
facilities. Class II demand, other than from ice cream manufacturers, is steady 
to higher. Spot prices on milk range from $5.00 under to $2.00 over Class, 
depending on location and timing. Milk marketers indicate, too, that interest 
in December milk contracting is improving. Processors have noted the recent 
global strength in commodities and consider that a good sign for upcoming dairy 
demand. Orders from bottlers are steady to higher. Although most school 
districts have decreased orders because of holiday closures, orders from 
grocery store accounts are generally higher as those outlet managers stock up 
ahead of the holiday. Cream availability is tighter in the Central region as 
Class II/III production heats up ahead of the holidays. With some ongoing cream 
exports taking place in the East region, clearing of cream from that region 
into the Central is limited. As a reversal of that trend, a few Central spot 
cream loads cleared into the East region. Also, some cheese plant managers are 
using condensed skim or nonfat dry milk and adding cream loads to the 
fortification process. This is taking additional cream out of the spot market. 
Production of sour cream, dips, cream cheese, and specialty drink items is 
higher. Cream multiples are steady to firmer, 1.21-1.35. The DMN National 
Retail Report-Dairy for November 11-17 noted the national weighted average 
advertised price for one gallon of milk is $2.57, $.41 above last week's 
price. The weighted average regional prices in the Midwest and South Central 
regions are $2.08 and $2.71, respectively. 

SPOT PRICES OF CLASS II CREAM, $ PER POUND BUTTERFAT                  
F.O.B. producing plants:   Upper Midwest -   $2.3420-2.6129           



1100CT Janet.Linder@ams.usda.gov 608.278.4157
USDA/AMS/Dairy Market News, Madison, Wisconsin
Dairy Market News website: www.ams.usda.gov/dairymarketnews
Dairy Market News database portal: http://www.marketnews.usda.gov/mnp/da-home