MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI March 5, 2015 (REPORT 9)

Milk volumes coming off the farms are trending higher compared to just 
a week ago. Rain storms that rolled through southern California did 
not impact milk production. Sales into fluid accounts are generally 
unchanged for the week. Some plants are ramping up production of 
holiday related milk-based drinks. Sales into educational systems are 
steady, but bottlers are already preparing for changes to orders 
related to the upcoming spring recess. Many school systems are 
rotating that recess between the last week of March and the first full 
week of April. The third snow survey showed the Sierra Nevada snowpack 
is below normal. Statewide, the water content in the snowpack is 19% 
of the historical average for this time of year. The winter months are 
generally the wettest months of the year in California, but the 
2014/2015 winter hasn't delivered much in the way of precipitation. 
Without the arrival of additional rain or snow in March, California 
may be facing a fourth consecutive year of drought. The February 4a 
price (butter/powder) in CALIFORNIA is $13.46, up $.37 from 
January 2015, but $9.62 lower than last year. This compares to 
the Federal Order Class IV price of $13.82 for February.  The 
February 4b price (cheese) is $13.78, $.03 higher than last 
month, but $7.36 lower than last year.  This compares to the 
Federal Order Class III price for February at $15.46.  Milk 
production in ARIZONA continues to increase from week to week, 
bolstered by near-perfect temperatures. Processors report plants in 
the state are busy trying to clear regular intakes as well as handle 
loads from out of state. Fluid demand is generally steady at seasonal 
levels. In-state cream demand from Class II facilities is steady to 
slightly higher. Cream is also clearing readily into California to 
keep churns operating close to capacity. Fieldwork is progressing and 
alfalfa harvesting is ongoing throughout the state. NEW MEXICO milk 
production plateaued this week, staying level with volumes of the 
previous week. Haulers reported hazardous driving conditions during 
the weekend and early in the week. Hauling times were extended due to 
those conditions. Classes I and II orders stepped higher early in the 
week. Production problems at a few plants forced some milk loads 
toward NDM production. Milk loads continue to move toward the west to 
find processing room. Fieldwork is a few weeks away in most parts of 
New Mexico. Alfalfa fields are starting to green up, especially on the 
western side of the state. Cream is actively clearing into butter 
churns while some ice cream facilities scale back orders temporarily. 
Some ice cream/frozen dessert plant operators anticipate a decline in 
cream prices after the spring holidays. Cream multiples are unchanged, 
1.15 to 1.25. At the CME Group, Grade AA butter closed Wednesday at 
$1.7500, up $.1075 compared to a week earlier.  Washington and 
Oregon milk production is up slightly over last week.  Oregon 
weather is in the 60s and sunny, which is expected to help 
continue production increases.  Milk supplies continue to 
support heavy cheese production schedules. Although parts of 
Utah received 20 inches of snow this week, temperatures remain 
comfortable with sunny skies, which will have a melting effect.  
Idaho has been partly sunny with temperatures heading into the 
60s toward the end of the week, with plenty of moisture to 
support good pasture growth.  Milk production in both states is 
up on a weekly basis and dairy producers are in a good situation 
with feed supplies and anticipated pasture conditions.  No 
disruptions in milk transportation or processing are reported.

	

1100CT Eric.Graf@ams.usda.gov 608.278.4153
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