MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI August 13, 2015 (REPORT 32)

The hot weather is reducing milk production in California. Milk cows 
continue experiencing heat stress during daytime hours with limited 
relief time at night. Some dairies report a reduction of returns due 
to the high cost of water. The demand for Class 1 is steady at 
customary levels. However, some bottlers are expecting an increase in 
sales as schools start during the next few weeks. Sales for Class 2 
are steady. The September 2015 Class 1 prices in California are $18.08 
in the north and $18.35 in the south. The statewide average Class 1 
price based on production is $18.09. That production average price is 
$0.42 higher than August 2015 but $7.31 than September 2014. Milk 
output in Arizona is trending lower. Daytime high temperatures and a 
rise in humidity continue reducing the comfort of the dairy herd. Some 
processors note a seasonal decrease in the butterfat components of the 
milk. Balancing plants are receiving fewer but sufficient milk volumes 
for processing. Class I sales are higher, but lower for Class II. New 
Mexico milk volumes are decreasing below the last year's levels. 
Manufacturing plants from nearby states continue clearing up milk 
volumes. Class I sales are higher as most of the public schools are 
reopening during this week. Class II sales are steady. With the recent 
showers, dairy operators are expecting an improvement in the quality 
of the alfalfa hay and corn crops. According to DMN National Retail 
Report-Dairy for week of August 7 - August 13, the weighted average 
advertised price for one gallon of milk is $2.51 in the Southwest, 
$2.50 in the Northwest, and $2.50 for the U.S. The heat in the Pacific 
Northwest has led to a decline in milk components and production. Some 
manufacturers are reporting bottling demand increasing with 
educational institutions starting again. Also, there have been some 
retail promotions leading to higher sales. Utah/Idaho milk production 
is steady with not much let up as the heat rises. Wetter weather 
conditions are not helping the alfalfa. Farmers are having 
difficulties harvesting without delays. Poorer quality is making 
prices drop. The corn, on the other hand, is doing well in the humid 
weather. The demand for cream from butter churns and cream cheese 
makers continues strong in the West. Some processing plants are 
running with a shortage of cream due to the seasonal decrease of 
butterfat content in the milk. Cream supplies are steady to lower. 
West cream multiples are unchanged, ranging from 1.25 to 1.60. At the 
CME Group, Grade AA butter closed Wednesday at $2.0150, up $0.0250 
compared to a week ago.







1100CT Angel.Teran@ams.usda.gov 608-557-7011
Tara.Herbst@ams.usda.gov 608-557-7007
USDA/AMS/Dairy Market News, Madison, Wisconsin
Dairy Market News website: http://www.ams.usda.gov/market-news/dairy
Dairy Market News database portal: 
http://www.marketnews.usda.gov/mnp/da-home