MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST
Madison, WI October 13, 2016 (REPORT 41)
In California, milk output is seasonally higher. Dairy cows are 
feeling less stressed as temperatures continue dropping in the 
Central Valley. Class 1 processors are looking forward to November to 
begin processing for holiday-related fluid products, such as eggnog. 
Bottled milk sales are even this week. Heavy manufacturing milk 
volumes are moving into processing facilities in order to meet the 
high Q4 needs. Dairy operators' demand for high quality alfalfa hay 
is moderate. Since supplies are tight in California, some operators 
continue importing supreme/premium alfalfa from nearby states. The 
November 2016 Class 1 prices in California are $16.13 in the north 
and $16.40 in the south. The statewide average Class 1 price based on 
production is $16.15. This price is $1.64 lower than the previous 
month and $1.54 lower than November 2015. In Arizona, milk production 
is trending up. Temperatures are getting cooler, which is increasing 
cows' comfort. Bottled milk requests from educational institutions 
are lower as most schools are on fall break this week. Orders from 
supermarkets and restaurants are steady. Alfalfa harvesting is active 
throughout the state. In New Mexico, the favorable climate conditions 
are supporting dairy herds' comfort. Milk volumes are in good balance 
with manufacturing needs. However, a few balancing plants are 
curtailing milk processing due to maintenance work. Sales into Class 
I and Class II are lower this week. Higher manufacturing milk volumes 
are clearing into Class III as many cheese processors are gearing up 
production in order to meet the high demand during Q4 holidays. New 
Mexico is between the fifth and sixth cutting of alfalfa hay. 
According to the DMN National Retail Report-Dairy for the week of 
October 7-13, the national weighted average advertised price for one 
gallon of milk is $2.38. The weighted average regional prices in the 
Southwest and Northwest are $2.26 and $1.99, respectively. Pacific 
Northwest milk production is near the bottom of the annual cycle and 
following typical seasonal patterns. Variations in weather conditions 
and cow comfort are bumping production up and down somewhat. However, 
overall milk production is in a downward trend that usually 
stabilizes in November. Bottling demand remains solid. Some industry 
contacts in the mountain states of Colorado, Utah and Idaho report 
milk production is still in the typical seasonal decline. However, 
contacts also note that milk intakes are increasing, possibly due to 
additions to the milking herd. A few manufacturers say school milk 
pipelines are filled and, between fall breaks and modest price 
increases, bottling demand has backed off a bit. Processors are 
having no trouble getting enough milk for most processing needs. 
Moderate condensed skim volumes continue clearing into NDM 
processing. Meanwhile, requests from ice cream makers are decreasing. 
Cream supplies continue growing in the West region. Cream cheese and 
butter processors are taking most of the cream volumes, while ice 
cream makers are demanding less. Cream usage into sour cream 
processing is active. This week, multiples for all classes are mixed, 
ranging from 1.05 to 1.22. 



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