MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI May 28, 2015 (REPORT 21)

Milk production in CALIFORNIA continues to step lower from week to 
week as daytime temperatures move higher. Daytime highs near 100 
degrees are forecast for the San Joaquin Valley. The drought in 
California is negatively impacting farming operations as some 
producers report water costs are increasing. Milk sales to bottling 
facilities are steady to lower as educational institutions begin the 
process of throttling back on school year orders. Also, popular 
summertime drinks, such as fruit punch and lemonade are taking the 
place of milk at restaurants.  ARIZONA milk production is decreasing 
due to the dry and warm weather. Class I sales are lower. Sales of 
condensed skim into Class II operations are trending upward.  NEW 
MEXICO milk intakes are stable during this week. Class I demand is 
steady to lower. Class II interest is unchanged. Some ice cream and 
frozen dessert plants are currently undergoing renovation projects and 
are out of production at this time.  Cream supplies and demand are 
balanced in the West. Market participants report cream supplies were 
ample over the holiday weekend. Most cream volumes are destined for 
ice cream and soft serve mix plants, as demand for stick/cup/cone and 
multi-serve packs is trending up. Ice cream producers are ramping up 
production as they expect peak sales in July. Butter manufacturers are 
also active in the market, continuing to build inventories ahead of 
summer.  Cream multipliers for all Classes are lower form past week, 
ranging from 1.15 to 1.28. At the CME Group, Grade AA butter closed 
Wednesday at $1.8700, down $.0600 compared to a week earlier.  PACIFIC 
NORTHWEST milk production has leveled off sooner than anticipated. 
Regardless, milk is readily available.  The recent holiday weekend and 
end of school terms have reduced milk bottling and made that milk 
available for manufacturing. Cream is also generally available with a 
few loads being sold outside the Northwest. Industry contacts report 
feed prices for farmers have remained reasonable.  IDAHO and UTAH milk 
production is strong.  Many manufacturers report they are running at 
capacity and a few are reporting they cannot take on new milk.  Cream 
is readily available.  Ice cream makers are filling freezers and some 
cream is being shipped to California.  The recent wet pattern through 
Southern Idaho and Northern Utah has helped replenish water supplies.  
According to the Weekly Weather and Crop Bulletin (NASS) for the week 
ending May 24, pasture and range condition is fair to excellent across 
79% of Oregon, 81% of Washington, and 91% of both Utah and Idaho.

1100CT Janet.Linder@ams.usda.gov 608.557.7003
Angel.Teran@ams.usda.gov  608-557-7011
Mike.Bandli@ams.usda.gov 608.557.7010
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