MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI August 17, 2017 (REPORT 33)

Warmer weather conditions continue to negatively affect farm milk 
production in California. Outputs are lower this week. However, milk 
is still available for most processing needs and is moving well 
within contracts. Spot loads are harder to find. Bottled milk demand 
is strong due to schools being back in session in most parts of the 
state. Arizona milk output is still following a downward trend. 
Nevertheless, balancing plants are working at or near full capacities 
processing milk. Class I demand is steady. Demand for Class II is 
active as ice cream processors continue taking on more loads of milk. 
Recent rains in the state have resulted in new forage production. 
Topsoil and subsoil moistures are both rated ninety-seven percent 
adequate to surplus. Milk production in New Mexico is slightly down. 
Class I sales are higher as most schools started to reopen. Class II 
requests are down. Due to repair/maintenance projects at some plants, 
cheese manufacturers have reduced their orders by a few loads. 
However, demand for Class III remains stronger this week as other 
Class III plants take on additional loads. Topsoil moisture across 
the state is eighty-two percent adequate to surplus compared with 
seventy-four percent last week. The third cutting of alfalfa hay is 
ninety-two percent complete, while the fourth and fifth cutting are 
respectively fifty-eight and twenty-one percent complete. In the 
Pacific Northwest, cows are producing more than sufficient milk to 
meet all manufacturing needs. The heat present in the area is not 
suppressing milk yields as cooler nights are helping cows recharge. 
Furthermore, pasture and rangeland conditions are good to excellent 
for dairy herds' productivity. Class I processors continue pulling 
heavy milk supplies to cover large bottled milk requests from schools 
and retailers. Farm milk output throughout the mountain states of 
Idaho, Utah, and Colorado is very active and processors are getting 
enough milk intakes to meet most manufacturing needs. Demands for 
Class I and Class II are fair to good. Some distressed milk loads are 
still available at $4 under market, according to some processors. 
Western condensed skim continues to move strongly in the Western 
region. Inventories are steady compared to last week. Contacts in the 
West report that ice cream makers are buying cream at higher 
multiples while butter producers are taking theirs at the lowest 
multiples. Most low multiples seem to be for a few distressed loads 
of cream. This week cream multiples for all usages remain steady at 
1.07-1.27. According to the DMN National Retail Report-Dairy for the 
week of August 11-17, the national weighted average advertised price 
for one gallon of milk is $3.22, up $0.62 from last week, and $0.73 
higher from a year ago. The weighted average regional price in the 
Southwest is $2.25, with a price range of $1.99-$2.39. This week, no 
advertised dairy ads were reported in the Northwest. According to 
CDFA, September 2017 Class 1 prices in California are $18.65 in the 
North and $18.92 in the South. The statewide average Class 1 price 
based on production is $18.66. This price is up $0.32 from the 
previous month, and $0.53 higher than a year ago. 

1100CT Florence.KoneGonzalez@ams.usda.gov (608)422-8594 
Michael.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