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Fluid milk and cream review — West

Due to disruptions at a couple of plants last week and this week, condensed skim and milk are moving from California to Fallon, Nev.

Published on January 26, 2018 5:15PM


(USDA Market News)

Jan. 25

California current milk output is rising on a weekly basis. However, production volumes are lower compared to last year. Milk prices are declining as well.

Due to disruptions at a couple of plants last week and this week, condensed skim and milk are moving from California to Fallon, Nev. One of the disrupted plants is producing butter as needed, but stopped producing nonfat dry milk.

Contacts report that finding the trucking necessary for milk hauling is a challenge.

Class 1 sales remain steady throughout the week. According to California Department of Food and Agriculture, December 2017 pool receipts of milk in the state total 3.18 billion pounds. This is 1.5 percent lower compared to the same month a year ago. From January through December 2017, unadjusted receipts are 2.7 percent lower from the comparable period in 2016. The Value at Test price is $15.45, $1.27 lower than the previous month, and $2.02 below a year ago.

The percentage of receipts used in Class 1 products is 13.20 percent. The November quota price is $15.40 and the over quota price is $13.70. These prices are $1.32 below last month and $2.10 lower from a year ago.

In Arizona, processing plants have been receiving heavy supplies of milk and are working harder to balance it. Milk production is continuously increasing and getting close to the flush levels.

Class I accounts are requesting steady volumes of milk as schools are back in session and their intakes are easy to predict.

In New Mexico, milk production continues its higher trend. Class I needs are slightly up while Class II sales decreased. Class III intakes increased despite downtime at one of the cheese plants.

Overall, milk supplies are up and processing plants continue to work at full capacity.

Pacific Northwest milk production is following seasonal patterns. Bottlers and dairy manufacturers have sufficient milk for processing needs.

Industry contacts report milk is mostly finding a home within the region, but a few loads are moving into neighboring states to find processing space.

In the mountain states of Colorado, Idaho and Utah there is still a lot of milk.

However, the access to processing capacity is what determines the perception of whether supplies are heavy or in balance.

Industry contacts say there is processing capacity available in Colorado and the southern part of the region.

The available room helps extenuate the heavy milk flows, and milk intakes are in good balance with processing needs.

Across Idaho and the northern part of the region, available space in manufacturing facilities is more limited and distressed loads offered at $3 to $4 under Class are not uncommon.

Western condensed skim is readily available in the spot market. Some manufacturers are selling condensed skim instead of drying it to accommodate disruptions resulting from repair/maintenance workloads.

Cream demand is steady to lower depending on the regions. Some processing plants are actively churning, as they are unable to sell all their supplies.

According to the DMN National Retail Report-Dairy for the week of Jan. 19-25, the national weighted average advertised price for one gallon of milk is $2.39, down $0.28 from last week, but steady from a year ago. The weighted average regional price in the Southwest is $2.28, with a price range of $1.99-$2.49.

The weighted average regional price in the Northwest is $1.99, with no price range. The NASS Milk Production report noted December 2017 milk production in the 23 selected states was 17.0 billion pounds, 1.2 percent above a year ago. Milk cows in the 23 selected states totaled 8.74 million head, 54,000 head more than a year ago.


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