FLUID MILK AND CREAM REVIEW – WEST
(USDA Market News)
In California, an incident at a cheese plant caused spot milk availability to increase. As so, spot prices are temporarily lower in some areas. This week, milk production is mixed with reports of increasing and decreasing outputs. Some manufacturers have maintenance/repair workloads that reduced their processing activities.
Class 1 intakes are steady this week. Milk output in Arizona is increasing, as the weather gets cooler. Some processing plants are planning their production schedules for the fall and winter. They anticipate that production will further increase and are looking for additional processing plants to help balance their milk as needed. A few manufacturers are doing their routine maintenance work to make sure that they are ready for Christmas processing activities.
Sales into Class I are stable. In New Mexico, some cheese plants are unable to take their full daily loads because of repair/maintenance issues. Consequently, milk holdovers have increased. Handlers are redirecting the excess milk supplies to other processing plants. Bottled milk requests from educational institutions and retail outlets are trending lower.
Class II requests have increased. Overall, milk yield in New Mexico has moved up.
Milk production in the Pacific Northwest is mostly following seasonal trends. Some industry contacts suggest a recent cold snap may have dampened milk output slightly in some areas. Although it may be too early to tell if the recent cold and precipitation will have much effect on milk production, it is reminiscent of the winter weather parts of the region experienced last year.
Some industry contacts suggest a few herds still have not fully recovered from the miserable cow comfort conditions.
Milk production in the mountain states of Idaho, Colorado and Utah is steady. Although milk output is near its seasonal low for the year, manufacturers report no trouble whatsoever in getting the milk needed. Processors are running at or near full capacity in order to keep up with upcoming holiday demand and to stay ahead of the available milk supply.
Condensed skim supplies are plentiful in the
West. Processors are looking to contract condensed skim and cream for 2018. However, due to lower current prices, customers are not concerned with product availability or contracting for next year.
According to industry contacts, cheese makers’ demand for condensed skim decreased.
This week, cream demand for butter churning is solid in Arizona, but slightly lower in California. A number of industry representatives suggest that some cream is moving from Arizona to Texas.
Mexico is also taking in some loads of cream for up to Christmas. Although current cream demand in the West is seasonally active, supplies outweigh demand.
Some Californian cream sellers report limited tank availability to move their loads.
Multipliers for all Classes are 1.07 to 1.29. According to the DMN National Retail Report-Dairy for the week of Nov. 3-9, the national weighted average advertised price for one gallon of milk is $2.79, down $0.05 from last week, but $0.63 higher from a year ago. The weighted average regional price in the Southwest is $2.54, with a price range of $1.89-$2.59.
The weighted average regional price in the Northwest is $1.99, with no price range. According to the NASS Dairy Products report, hard ice cream production in the West region for September 2017 is 13.4 million gallons, 18.3 percent lower than a month ago, and 9.3 percent below the previous year.