MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST
Madison, WI September 8, 2016 (REPORT 36)
Farm milk output is slowly improving in California. Daytime 
temperatures below 95 degrees are supporting cows' comfort. 
Manufacturing milk supplies are adequate for post-holiday orders. 
Class 1 sales are steady to lower as the schools' pipelines are at 
comfortable levels. Sales into Class 3 are lower as interest for ice 
cream and frozen desserts is steadily decreasing. The August 4a price 
(butter/powder) in California is $13.99, down 24 cents from the 
previous month, but 91 cents higher from a year ago. This compares to 
the Federal Order Class IV price of $14.65 for August. The August 4b 
price (cheese) is $16.34, up $1.67 from the previous month and 60 
cents above a year ago. This compares to the Federal Order Class III 
price for August at $16.91. The remnants of tropical storm Newton are 
causing heavy rains throughout Arizona. As a result, milk yields are 
lower due to the wet conditions. However, balancing plants are 
receiving sufficient milk volumes for processing. Class I demands 
from retailers, food service and educational institutions are higher. 
Sales into Class II are seasonally decreasing. Alfalfa hay harvesting 
has been delayed due to the weather conditions. New Mexico milk 
output is steady to slightly lower. The wet conditions are reducing 
cows' comfort. Class I sales are steady to lower, as most K-12 
schools' pipelines are full. Bottled milk requests from retailers and 
food service are steady. Manufacturing milk volumes moving into Class 
II are higher this week. Sales into Class III are even. According to 
the DMN National Retail Report-Dairy for the week of September 2-8, 
the national weighted average advertised price for one gallon of milk 
is $2.80, up 43 cents from last week and 34 cents higher from a year 
ago. The weighted average regional prices in the Southwest and 
Northwest are $3.45 and $2.50, respectively. Pacific Northwest milk 
production is steady to lower and following typical seasonal trends. 
Bottling demand has plateaued as school milk pipelines are filled. 
Manufacturers have adequate milk supplies for most processing needs. 
Milk intakes are steady to lower in the mountain states of Colorado, 
Idaho and Utah. Current weather patterns are favorable for cow 
comfort and milk production. Industry contacts report some seasonal 
ramp up of milk demand from cheese production, but nothing out of the 
ordinary. The good growing season has yielded a lot of high quality 
hay and other crops. Contacts expect feed costs to remain favorable 
for dairy production into the coming year. Western condensed skim 
demands from NDM and SMP processors are strong. Meanwhile, interest 
from ice cream manufacturers is steadily decreasing. Condensed skim 
manufacturing is ongoing, while supplies are slightly lower. Western 
cream supplies are mostly steady. Demands from churn operators and 
cream cheese makers are active. Less cream volumes are moving into 
ice cream manufacturing as interest for ice cream continues waning. 
Multiples for all classes are slightly lower, ranging from 1.17 to 
1.29. 
DAIRY PRODUCTS:  According to NASS, hard ice cream production in the 
West region for July 2016 is 16.3 million gallons, 19.4% below a year 
ago and 14.4% lower than the previous month. 


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