MD_DA230                                                              
DA                                                                    
MD DA230   Fluid Milk and Cream Review - Central                      

MADISON, WI.  January 12, 2017 (REPORT 2)                             

With recent colder weather in the South Central area, milk handlers report 
daily milk pickup volumes trended marginally lower during the last several 
days. However, the trend is not expected to be long-term. North Central area 
milk handlers indicate trends for on-farm pickup volumes are steady to 
building. Bottler demand is rebounding as higher education institutions 
restart, especially for single serve containers. Restaurant demand is moderate. 
The DMN National Retail Report-Dairy for January 6-12 noted the national 
weighted average advertised price for one gallon of milk was $2.74, up $0.05 
from a week ago and $0.20 higher than a year ago. The weighted average regional 
prices in the Midwest and South Central were $2.27 and $2.63, respectively. 
Demand from Class II soft serve mix and hard pack ice cream manufacturers for 
condensed skim and cream is higher. Production coming off multi-serve and 
stick/cup/cone lines is trending higher to meet spring orders. Cream cheese 
producers are taking higher volumes of cream as well. Spot cream loads are 
moving into Classes II, III, and IV. Cream availability on the spot market is 
mixed as higher cream volumes are clearing into contracts within the region, 
but spot cream loads from the East region are finding interest in the Central. 
Multiples are higher as demand builds for cream, ranging 1.08 - 1.21. Demand 
for spot milk loads from cheese plant operators is steady to higher. With 
increased demand, some of the commodity cheese manufacturers are less 
interested in milk. Due to enhanced pricing on specialty cheeses, producers of 
those cheese types are better able to pay marginally higher prices for spot 
milk loads. Current prices on milk loads range from $2.00 under to $1.50 over. 
Some spot milk loads are catch-up loads that could not be delivered during the 
yearend holidays. The NASS Dairy Products report noted November U.S. regular 
(hard) ice cream production totaled 52.0 million gallons, down 5.3 percent from 
last year. January-November U.S. production totals 722.6 million gallons, 0.2 
percent above 2015 during the same time span. November production in the 
Central region totaled 26.8 million gallons, 4.3 percent below a year ago.

SPOT PRICES OF CLASS II CREAM, $ PER POUND BUTTERFAT                  
F.O.B. producing plants:   Upper Midwest -   $2.4192-2.7104           



1100CT janet.linder@ams.usda.gov 608.557.7003
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