MD_DA230                                                              
DA                                                                    
MD DA230   Fluid Milk and Cream Review - Central                      

MADISON, WI.  March 09, 2017 (REPORT 10)                              

Milk production continues without a slowdown in the Central United States. Some 
Central region contacts estimate the spring flush will only provide a minor 
variation, as recent weather and feed quality have been favorable for milk 
components and production. However, other contacts expect a noteworthy increase 
in milk production from mid-March through May. Contacts report that Class I 
interest is slow. Many educational institutions are in the midst of spring 
break, or will be on break in the upcoming two weeks. Class III manufacturers 
are hesitant to take on spot milk, as they are finding contracted milk supplies 
sufficient. Most reports on spot milk prices into Class III operations range 
from $1.50 to $4.00 under Class, a few reports noted offers of spot milk as low 
as $6.00 under Class III. Cheesemakers, even at discounted spot milk prices, 
are hesitant or unable to take on spot milk as their current contractual 
supplies are sufficient. Cream is also abundant. Butter producers are opting to 
churn cream and store the bulk butter, instead of offering cream on the spot 
market at the currently discounted prices. Multiples for cream headed into 
Class IV production have been reported at flat market. Interest from ice cream 
makers continues to grow, but some cream contacts say ice cream inquiries 
started later this year than in years' past. Whipping cream and cream cheese 
manufacturers are also continuing to order cream, as spring holidays are 
nearing. Class II cream multiples are in the 1.04 to 1.16 range. The DMN 
monthly average of the range price series for Upper Midwest Class II cream 
during February 2017 was $2.4132, compared to $2.5590 a year ago. The NASS 
Dairy Products report noted January 2017 U.S. regular (hard) ice cream 
production totaled 56.6 million gallons, down 0.8 percent from last year. 
January production in the Central region totaled 29.3 million gallons, 8.3 
percent below a year ago. The DMN National Retail Report-Dairy for March 3-9 
noted the national weighted average advertised price for one gallon of milk was 
$3.11, up $0.80 from a week ago and $0.73 higher than a year ago. The weighted 
average regional prices in the Midwest and South Central were $2.41 and $3.07, 
respectively. 

SPOT PRICES OF CLASS II CREAM, $ PER POUND BUTTERFAT                  
F.O.B. producing plants:   Upper Midwest -   $2.2667-2.5282           

1100CT Israel.weber@ams.usda.gov 608.422.8601
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