MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST
Madison, WI October 20, 2016 (REPORT 42)
In California, farm milk production is up, following typical seasonal 
patterns. Milk protein and butterfat components are steadily 
improving. Bottled milk requests from retailers and food service are 
slightly higher. Orders from most educational institutions are 
steady. Demands for some Class 2 dairy products, such as sour cream, 
are ramping up. However, interest for Class 3 (ice cream) is 
seasonally declining. Heavy milk intakes continue clearing into Class 
4b processing plants, as many cheese manufacturers are running 
operations at near to full capacity. Farm milk yields are higher in 
Arizona due to cooler temperatures. Schools are reopening after the 
fall break. Therefore, school meal programs are pulling higher Class 
I milk volumes. Bottled milk sales to retailers are up as some 
supermarkets are restocking shelves. Orders from restaurants are 
steady. Milk pooled on the Arizona Order 131 totaled 348.1 million 
pounds in September 2016. Class I utilization accounted for about 
31.0% of producer milk. The uniform price was $16.22, $0.06 above 
last month, but $0.58 below one year ago. Milk production is slightly 
lower in New Mexico due to the high humidity affecting cows' comfort. 
However, processors are having no trouble getting enough milk for 
most manufacturing needs. Bottled milk orders from restaurants and 
grocery stores are steady to slightly higher. Since milk components 
are improving, some Class III processors are buying less milk loads 
in the spot market. According to the DMN National Retail Report-Dairy 
for the week of October 14-20, the national weighted average 
advertised price for one gallon of milk is $2.55. The weighted 
average regional price in the Southwest is $2.28. Pacific Northwest 
milk production continues along typical seasonal patterns. Farm milk 
output is near the bottom of the annual cycle. Although high winds, 
heavy rains and a couple tornados battered the Washington and Oregon 
coastlines, industry contacts report minimal issues at dairy farms or 
processing facilities. Bottling demand is steady and milk is in good 
balance with current processing needs. Dairy contacts in the mountain 
states of Colorado, Utah and Idaho report milk production continues 
to slowly trail off seasonally. Components are improving. In Idaho, 
several new dairy installations and existing farms adding cows have 
given a boost to cow numbers. Many dairy farmers seem willing to hold 
onto cows longer with inexpensive feed and low cull cow prices. Milk 
pooled on Pacific Northwest Order 124 totaled 608.0 million pounds in 
September 2016. Class I utilization accounted for about 27.6% of 
producer milk. The uniform price was $15.77, $0.02 below last month 
and $0.59 below one year ago. Wester condensed skim supplies are 
readily available for drying, as requests from ice cream makers are 
seasonally lower. Therefore, heavy condensed skim volumes are 
clearing into NDM and SMP manufacturing. Cream is more available 
throughout the West. Most cream supplies are clearing into butter 
churning. Demand from ice cream processors is weakening. However, the 
interest from sour cream and cream cheese makers is seasonally 
active. Many sellers and buyers are finalizing cream contracts for Q1 
of 2017. This week, multiples for all classes are lower, ranging from 
1.03 to 1.20.



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