MD_DA230 DA MD DA230 Fluid Milk and Cream Review - Central MADISON, WI. February 02, 2017 (REPORT 5) **UPDATED Steady increases in milk production are noted throughout the Central region, with comparatively higher week to week increases noted in the South Central area. Weather conditions were seasonally mild throughout the region and had minimal impacts on milk production trends. Bottled milk demand is unchanged. Most bottlers report that with the school pipelines filled, there are only occasional increases in orders from consumer outlets. Those are generally based on specials tying bottled milk purchases to cereals or other breakfast items. Food service demand is steady. Interest in milk loads from Class III manufacturers is steady to lower, with some manufacturers looking for outlets for some part of regular milk intake volumes. A few plant operators are now out of the spot milk market, which previously was a weekly part of their cheese milk supply. As commodity cheese manufacturers back away from taking in additional milk loads, spot milk prices are under some pressure. Buyers report prices range from $2 **under to flat Class, with lower prices clustered around weekend sales. Cream demand is steady to lower into Class II production facilities focusing on dips and sour cream, as production runs for Super Bowl related orders are complete. Ice cream/soft serve production is steady to higher. A few plant operators indicate they are 8 to 10 weeks out from full production schedules for those items. However, orders for flavored soft serve shake mixes are higher as various fast food seasonal promotional items come back to menus. Cream multiples are steady to lower, ranging from 1.05 to 1.18. A few cream sellers indicate they are holding firm at the top of the range and would channel cream to other uses ahead of selling at lower multiples. Western cream loads are flowing into the Central region, filling some Class II needs ahead of loads from within the region. The DMN National Retail Report-Dairy for January 27-February 2 noted the national weighted average advertised price for one gallon of milk was $2.55, up $0.16 from a week ago and $0.30 higher than a year ago. The weighted average regional prices in the Midwest and South Central were $2.03 and $3.39, respectively. The NASS Agricultural Prices report noted the U.S. alfalfa hay price received during December 2016 averaged $129 per ton, compared to $149 a year ago. The average U.S. corn price was $3.33 per bushel, compared to $3.65 last year; the U.S. soybean price averaged $9.64 per bushel, compared to $8.76 a year ago. The all milk price averaged $18.80 per cwt, compared to $17.30 a year ago. The December milk-feed ratio was 2.70, compared to 2.29 a year ago. The NASS Cattle report for January 1 cattle inventories showed for milk cow replacements, numbers of all heifers 500 pounds and over were lower compared to January 2016. Nationally, there are 60,000 fewer milk cow replacement heifers on hand. In the Central region, the same trend towards lower heifer replacement numbers holds true. Central Region January 2017 Milk Cow Replacement Heifers (500 pounds and over), (USDA-NASS) January 2016 January 2017 (1,000 head) (1,000 head) Illinois 50 52 Indiana 80 80 Iowa 120 135 Kansas 110 100 Michigan 172 170 Minnesota 300 295 Ohio 120 120 South Dakota 50 45 Texas 250 260 Wisconsin 735 710 Central Total 1987 1967 In the South Central area, wheat winter, rye, and oats showed growth, although damage from cold temperatures is apparent in some areas. In the North Central, winter conditions persist, with no fieldwork days reported. SPOT PRICES OF CLASS II CREAM, $ PER POUND BUTTERFAT F.O.B. producing plants: Upper Midwest - $2.3179-2.6049 1230CT 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