MD_DA240 DA MD DA240 FLUID MILK AND CREAM REVIEW - WEST Madison, WI June 8, 2017 (REPORT 23) *Resent to correct price change FLUID MILK AND CREAM - WEST California farm milk production is currently variable. In some part of the state, volumes produced are unchanged from last week, whereas in other areas, output is higher due to recent cooler temperatures. Class 1 fluid demand is lower. The May 4a price (butter/powder) in California is $14.43, up *70 cents from the previous month, and $1.86 higher from a year ago. This compares to the Federal Order Class IV price of $14.49 for May. The May 4b price (cheese) is $15.25, up *95 cents from the previous month, and $3.88 above a year ago. This compares to the Federal Order Class III price for May at $15.57. According to some industry contacts, in Arizona, the heat is currently having little impact on milk. Farm milk production took a slight dip this week. With schools being out, many processors are actively balancing more of their milk. The monsoon season is starting next week. Consequently, Arizona will be having torrential rain and dust storms that will more likely affect their milk output. Class I is moving slowing. However, local advertised sales have increased. In New Mexico, farm milk production is steady to slightly up this week. Class I sales have decreased, putting more pressure on dryers. Inventories are plentiful, and processing plants are working at full capacity to avoid milk discarding. A few contacts report that some plants are sending milk to calf ranches and ground application of condensed and raw milk. Milk intakes for Class II are stable to slightly increasing as ice cream and frozen dessert manufacturers increase their orders. Class III interest is flat to lower. A few manufacturers report having repair/maintenance issues that reduced their milk intakes. As the result, system-wide holdovers are high in some areas. Pacific Northwest dairy contacts say milk production continues to improve after a hard winter and spring. Some contacts suggest it may be newly lactating cows that have provided the boost to milk volumes. Warmer days have improved cow comfort and spring feed is in good supply. With most schools done for the year, milk supplies have shifted to summer consumption patterns. More milk is available for manufacturing. Processors say they have plenty of milk available. Many manufacturers are running their facilities at or near full capacity. Milk supplies are plentiful for processors in the mountain states of Colorado, Utah and Idaho. Manufacturers report no problems getting the milk needed for most processing needs. Milk production is increasing along seasonal patterns and cow comfort is improving across much of the region. Demand for condensed skim is flat in the West. Contacts report that condensed skim is available in the spot market at lower prices. In addition, it was reported that some processors decided to dry their condensed skim instead of selling it. Western cream interest continues to be seasonally up for ice cream and frozen dessert makers. With higher temperatures in most part of the West, haulers are taking extra precaution in handling cream, so that they arrive in acceptable conditions. Cream multiples for all classes range on average from 1.08 to 1.25. However, a few contacts reported multiples in the high 1.30s to low 1.40s. According to the DMN National Retail Report-Dairy for the week of June 2-8, the national weighted average advertised price for one gallon of milk is $3.34, down $0.12 from last week, but $0.90 higher from a year ago. The weighted average regional price in the Southwest is $2.11, with a price range of $1.87-$2.99. The weighted average regional price in the Northwest is $2.39, with no price range reported. According to the NASS Dairy Products report, hard ice cream production in the West region for April 2017 is 16.3 million gallons, 7.7% lower than a month ago, and 15.5% below the previous year. 1100CT Florence.KoneGonzalez@ams.usda.gov (608)422-8594 Mike.Bandli@ams.usda.gov (608)422-8592 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