MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI October 15, 2015 (REPORT 41)

California milk production is marginally higher. Temperatures and humidity 
are lower in the San Joaquin Valley. These weather conditions are helping 
with the milking cows yield. Class 1 demand from the retail and food service 
sectors is mostly steady. Demand for milk from Class 2 is slightly higher. 
The November 2015 Class 1 prices in California are $17.68 in the north and 
$17.95 in the south. The statewide average Class 1 price based on production 
is $17.69. That production average price is $0.31 higher than October 2015 
but $6.65 lower than November 2014. Milk output is steady to lower in 
Arizona, as temperatures and humidity increased throughout the week. 
However, some producers note improvements in the butterfat component level 
of the milk. Orders from bottlers are higher since some educational 
institutions reopened after fall break. Demand for condensed skim from 
yogurt and NDM processors is active. Favorable weather conditions are 
helping to increase milk output in New Mexico. Some balancing plants are 
curtailing milk processing due to maintenance projects. Thus, manufacturing 
milk volumes (surplus) are a little higher. Bottled milk sales to groceries 
stores are steady. Class II sales are higher. Recent rains delayed 
harvesting of alfalfa hay in areas of the state. According to the DMN 
National Retail Report-Dairy for the week of October 9 - 15, the national 
weighted average advertised price for one gallon of milk is $2.56, $2.95 in 
the Southwest and $2.23 in the Northwest. Cow comfort is good across much of 
the Pacific Northwest. Milk production has dropped slightly in some areas 
and is following seasonal trends. Milk intakes are generally a little above 
last year. Bottling demand remains steady. Utah and Idaho milk production is 
in a typical fall decline. Industry contacts say milk tapered earlier than 
usual this year. Manufacturers are mostly content with the available milk 
supplies. Farm contacts suggest the growing season was exceptional this 
year, with the tonnages of corn silage and hay surpassing expectations. Some 
farmers are making a fifth cutting of hay. Although much of the region 
experienced ideal weather late in the growing season, hay quality is a 
conundrum. Relative feed values for hay have been averaging about 20 points 
lower than typical hay crops. Western cream demand from butter makers 
remains strong. In addition, the cream interest from cream cheese and sour 
cream manufacturers is improving. Cream availability in the spot market is 
increasing. Some processors are selling the cream instead churning as prices 
and multiples continue relatively higher. Western cream multiples range is 
wider, ranging from 1.12 to 1.32. 

1100CT 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: http://www.ams.usda.gov/market-news/dairy
Dairy Market News database portal: http://www.marketnews.usda.gov/mnp/da-
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