MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI January 26, 2017 (REPORT 4)

Milk production in California is steady to slightly lower manly due 
to the soggy climate. Some dairy operations throughout the Central 
Valley are still recovering from last weekend's rainstorms that 
resulted in flooding and mudslides. However, according to many 
processors, milk supply is more than adequate in order to cover all 
manufacturing needs. Bottling milk orders from several retail outlets 
and restaurants look to be up this week. Class 2 demand is flat. 
According to California Department of Food and Agriculture, December 
2016 pool receipts of milk in the state total 3.22 billion pounds. 
This is 0.5% lower compared to the same month a year ago. From 
January through December 2016, receipts are 1.7% lower from the 
comparable period in 2015. The Value at Test price is $17.47, $0.51 
higher than the previous month and $2.07 above a year ago. The 
percentage of receipts used in Class 1 products is 13.72%. The 
December quota price is $17.50 and the over quota price is $15.80. 
These prices are $0.25 above last month and $1.95 higher from a year 
ago. Although rain showers are present in Arizona, milk production 
continues inching up. However, the wet weather is causing some issues 
with milk hauling in some areas of the state. Class I demand is flat 
as pipelines from several market channels are full. Interest for 
Class II is improving, but slowly. Milk production in New Mexico is 
trending down, principally due to muddy conditions at some dairy 
operations. Nevertheless, there are enough milk volumes for 
manufacturing. Moreover, some processors from nearby states are 
helping to clear heavy milk intakes from New Mexico. This week, sales 
into Class I are down, but sales into Class II are slightly up. Milk 
volumes clearing into Class III are steady. The wintry weather in the 
Pacific Northwest has been conductive to lower milk yields. 
Therefore, some manufacturers are receiving less milk supplies this 
week, but supplies are adequate for most processing needs. Class I 
requests from several market channels are steady. Milk hauling is 
back to normal, after being affected by heavy rains during last week. 
In the mountain states of Idaho, Colorado, and Utah, milk output is 
slightly down, mainly due to the cold weather. Nevertheless, 
according to some processors, milk intakes appear to be in good 
balance with manufacturing needs. Heavy accumulation of snow on the 
roads is creating some milk delivery delays. According to the DMN 
National Retail Report-Dairy for the week of January 20-26, the 
national weighted average advertised price for one gallon of milk is 
$2.39, down 67 cents from last week and 36 cents lower from a year 
ago. The weighted average regional price in the Southwest is $2.76. 
There were no reported prices for gallon milk in the Northwest this 
week. Condensed skim intakes are readily available in the West as 
large amounts continue clearing into NDM/SMP processing. Western 
cream demand from Class II is light to moderate as manufacturers 
finish sour cream and dip orders for Super Bowl-related shopping. Ice 
cream and ice cream mix makers are pulling more cream, but slowly. 
Most cream supplies are clearing into butter churning. At this point, 
interest for spot cream from butter makers is sluggish. This week, 
multiples for all classes are steady to slightly higher, ranging from 
1.00 to 1.20. The NASS Milk Production report noted December 2016 
milk production in the 23 selected states was 16.8 billion pounds, 
2.4% above a year ago. Milk cows in the 23 selected states totaled 
8.7 million head, 53,000 head more than a year ago. The following 
table shows western states included in the report and the monthly 
milk production changes compared to a year ago: 

December 2016 Milk Production, (USDA-NASS)
 
                     (Million Lb.)        % Change From
                                            1 Year Ago
  
Arizona                   411                + 0.2
California              3,380                + 0.5
Colorado                  338                + 7.3
Idaho                   1,197                + 2.7
New Mexico                668                + 7.1
Oregon                    207                - 2.8
Utah                      177                - 1.7
Washington                547                - 0.2



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