MD_DA240 DA MD DA240 FLUID MILK AND CREAM REVIEW - WEST Madison, WI October 22, 2015 (REPORT 42) Milk output is steady to lower in California. High humidity in the Central Valley is adversely affecting cow comfort. Bottled milk sales to groceries stores and food service are improving. Although milk production is down, various processors note some improvement in the butterfat component level. Bottled milk demand is steady to higher. Condensed skim interest from NDM processors is steady to higher. According to California Department of Food and Agriculture, September 2015 Class 1 sales in California totaled 55.1 million gallons, 5.1% lower compared to September last year. From January through September 2015 Class 1 sales totaled 492.5 million gallons, 4.9% lower from the comparable period in 2014. Arizona milk intakes are lower. Raining conditions are taking a toll on dairy herd comfort. Some dairy processors indicate some equipment/maintenance works throughout the week. Thus, milk volumes into manufacturing are lower. The current demand for Class I and Class II is higher. Milk pooled on the Arizona Order 131 totaled 367 million pounds in September 2015. Class I utilization accounted for about 29.7% of producer milk. The uniform price was $16.80, $0.92 above last month but $8.11 below one year ago. New Mexico milk production is lower. Thunderstorms with heavy rains are negatively affecting the milk yield of herd. However, manufacturing milk volumes are adequate in and out of the state. Class I and Class II sales are lower compared with a week ago. According to the DMN National Retail Report-Dairy for the week of October 16 - 22, the national weighted average advertised price for one gallon of milk is $2.45 and $2.14 in the Southwest. Pacific Northwest milk production continues to slow a little and is following seasonal trends. Processors say the slowdown has allowed time for routine maintenance. Milk intakes are adequate for processing needs. Bottling demand remains steady. Utah and Idaho milk production is in a typical fall decline. Industry contacts say there is no problem getting enough milk for processing needs, but discounted loads are not readily available. Milk components are increasing slightly. Milk pooled on Pacific Northwest Order 124 totaled 475.3 million pounds in September 2015. Class I utilization accounted for about 35.7% of producer milk. The uniform price was $16.36, $1.51 above last month but $7.94 below one year ago. Demand for cream from butter and cream cheese processors remains strong in advance of the Q4 holidays. Spot sales of cream loads are active throughout the West. Cream supplies are mostly steady. Western cream multiples range is unchanged, ranging from 1.12 to 1.32. The Grade AA butter price at the CME Group on Wednesday closed at $2.4200, up 7 cents from a week ago. According to NASS, September milk production for the 23 surveyed states totals 15.6 billion pounds, +0.4% higher than a year ago. September milk production changes from a year ago for selected Western states are as follows: Arizona +1.2%, California -3.6%, Colorado +4.4%, Idaho +1.7%, New Mexico -2.0%, Oregon -2.9%, Washington -0.2% and no changes in Utah. Monthly milk production per cow for the 23 surveyed is one pound below September 2014. Milk cow numbers on farms in the 23 selected states totaled 8.63 million cows, 41,000 head more than September 2014. Dairy Market News Reporting Changes Proposal Dairy Market News (DMN) is proposing updating the Dairy Market News Working Guidelines. This proposal is the result of an industry comment period. The updates would allow DMN market reports to additionally include information and sales prices reported by individuals and firms functioning as marketing agents selling on the behalf of dairy product manufacturers. The Working Guidelines updates are intended to capture more information on pricing and market conditions and reflect the evolution of the marketing of dairy products. Currently, market pricing information is collected for first sale, f.o.b. producers' plants or warehouses. The changes would be effective starting with Report 1, January 2016. Comment by October 30, 2015 to: DMN@ams.usda.gov Link to current DMN working guidelines: http://www.ams.usda.gov/market-news/individual-dairy-market-news-commodity- reports 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- home