MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI January 15, 2015 (REPORT 2)

CALIFORNIA milk production is mainly steady with recent weeks.  
Some handlers are seeing slight increases in milk supplies, yet 
are unwilling to declare a trend.  Milk is available for all 
usages.  Class 1 interest is higher but beginning to stabilize 
as needs are met from schools and colleges returning.  ARIZONA 
milk output is trending higher and January supplies are 
building.  Additional cow numbers, more feeding, and a slight 
push for cash flow are noted reasons.  Processing plants have 
room for the milk but are becoming more strategic.  Class I 
demand is flat and uneventful.  Milk production for NEW MEXICO 
is steady to slightly lower, reflected in lower milk receipts at 
the plant level.  Class I interest is higher this week.  Some 
processing plants are taking maintenance breaks.  Milk is being 
handled orderly and clearing on time.  Cream demand is fair to 
good for January.  Ice cream producers are taking more volumes 
than expected.  Lower pricing compared to last year is the main 
reason producers are pulling more cream as they rebuild 
holdings.  Butter production is active and more shifting to bulk 
butter is noted as print needs slow.  Western cream multiples 
are unchanged and range from 1.15 to 1.55.  At the CME Group, 
Grade AA butter closed Wednesday at $1.5425, up $.0025 compared 
to a week earlier. Milk production in the PACIFIC NORTHWEST is 
increasing along seasonally expected volumes. Moderate winter 
temperatures are helping to increase production in the region. 
No major problems have been reported in moving milk to various 
manufacturing plants but there have been reports of trucking 
issues due to a shortage of drivers. Lack of significant 
snowfall is becoming more of a concern as reservoirs are at 
reduced levels for this year's irrigation needs. UTAH and IDAHO 
milk production continues to improve. Lower milk prices are 
encouraging dairies to increase herd size. According to the Farm 
Service Agency, USDA Secretary Tom Vilsack announced that more 
than half of all dairy farms in the country have enrolled in the 
Margin Protection Program.  This has exceeded expectations as 
the participation in the crop insurance program is 30 to 80%. 



1100CT Butch.Speth@ams.usda.gov 608.278.4152
Tara.Herbst@ams.usda.gov 608.278.4154
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