FLUID MILK AND CREAM REVIEW – WEST
(USDA Market News)
In California, milk output is steady, following normal seasonal production schedules. Currently, milk supplies are adequate for post-holiday orders. Bottling demand from educational institutions has plateaued as their pipelines are full. Intakes from restaurants and grocery stores remain stable.
Milkfat components are steady this
The August 4a price (butter/powder) in California is $16.68, up $0.27 from the previous month, and $2.69 higher from a year ago. This compares to the Federal Order Class IV price of $16.61 for August.
The August 4b price (cheese) is $16.26, up $0.97 from the previous month, but $0.08 below a year ago. This compares to the Federal Order Class III price for August at $16.57.
In Arizona, milk production is unchanged from last week. Contacts report that milk supplies are in balance with processing needs. Milk intakes from grocery stores are trending higher. However, requests from schools are stable. Milk going into ice cream manufacturing continue to move strong.
Milk production in New Mexico is steady to decreasing. Intakes for some Classes were higher this week. Fluid milk demand from schools increased as they prepare for the fall session. Class I intakes by the food services and retailers are up. Ice cream manufacturers are showing a great interest for Class II. Class III demand is rapidly trending down. Contacts report that manufacturing plants in the area where Hurricane Harvey took place reopened and are taking milk from New Mexico to fill their current orders.
Pacific Northwest milk production is edging back along seasonal trends. Parts of the region have had serious wildfires resulting in the diversion of milk loads, but little disruption to production or processing. School pipelines are getting filled and have taken some pressure off of dairy processing. Manufacturers report no trouble getting the milk wanted for most processing needs. The region has had warm temperatures and continued dry conditions.
Pasture and rangeland are in good or excellent condition in only 8 percent of Oregon and 9 percent of Washington.
Milk production in the mountain states of Idaho, Utah and Colorado is steady. Although the region has had warm weather, the higher temperatures have done little to slow the heavy flow of milk.
Handlers are struggling to find a home for all of the milk. Some milk is moving into neighboring states, but often at discounted prices of $2 to $4 under Class. Industry contacts suggest with cooler temperatures in the next few weeks and plenty of good quality feedstocks, it may be some time before the milk volumes diminish.
Pasture and rangeland are in good or excellent condition in 63 percent of Colorado, 57 percent of Utah and 47 percent of Idaho.
Condensed skim demand continues to be active in the West. Class II and Class III processors are taking in steady volumes.
In the West, cream continues to move strong into ice cream manufacturing. Some contacts report that a lot of cream moved to the churn this week due to many plants being closed on Labor Day.
As the initial start of the baking season approaches, processors expect cream demand to increase. Cream multiples for all Classes are 1.06-1.25.
According to the DMN National Retail Report-Dairy for the week of Sept. 1-7, the national weighted average advertised price for one gallon of milk is $2.60, up $0.24 from last week, but $0.20 lower from a year ago.
The weighted average regional price in the Southwest is $2.44, with a price range of $1.89-$2.99.
The weighted average regional price in the Northwest is 1.99, with no price range reported. According to the NASS Dairy Products report, hard ice cream production in the West region for July 2017 is 16.3 million gallons, 6.2 percent lower than a month ago, and 0.8 percent below the previous year.