FLUID MILK AND CREAM REVIEW – WEST
(USDA Market News)
Farm milk production in California is steady to increasing. Contacts report adequate supplies of milk for manufacturing obligations. Class 1 sales to educational institutions are back to their usual level as they refill their pipelines.
The hay season is ending in California. According to some industry contacts, the prices for good quality hay have edged up. However, dairy farmers are reluctant to pay higher premiums for hay due to lower current milk prices. The supplies of hay available for sale are plentiful.
According to CDFA, October 2017 Class 1 sales in California totaled 53.8 million gallons, up 4.1 percent from last month, but down 1.7 percent from the previous year.
From January through October 2017, Class 1 sales totaled 516.6 million gallons, down 3.4 percent from the comparable period in 2016.
In Arizona, milk production is trending higher as cows get more comfortable with cooler temperatures.
Milk components are also starting to improve. Bottled milk sales to schools are improving. In general, milk intakes are in balance with current processing needs.
The market tone is stable. Milk pooled on the Arizona Order 131 totaled 386.5 million pounds in October 2017. Class I utilization accounted for about 29.3 percent of producer milk. The uniform price was $16.43, down $0.46 from last month but $1.04 above one year ago.
In New Mexico, fluid milk supplies remain plentiful as some Class III manufacturing plants continue to reduce their usual intakes so they can take care of their repair/ maintenance workloads. Handlers are still managing to relocate the excess supplies to other processing factories. Milk production is steady and at normal level for the
Class I intakes are increasing as schools reopen after the holiday and retail stores restock their shelves.
Pacific Northwest milk production is steady and following seasonal patterns. Even with a stretch of cool, rainy and windy weather this week, cow comfort did not suffer too much. Industry contacts suggest that although cows on pasture or in open paddocks may have searched out shelter for a time, the weather did not did not impact milk production much.
Processors indicate there is plenty of milk for production of manufactured dairy products. Milk production in the mountain states of Idaho, Utah and Colorado is flat to growing.
While processing capacity in the southern part of the region has kept pace with the milk supply, processing capacity in Idaho has not. The sale of a number of milk cows several weeks ago is a harbinger of the pressures faced by a number of dairymen in the state. With generally heavy inventories of dairy products and intense competition in global markets, processors may be hesitant to put on additional capacity.
And in turn, farmers may feel growing pressures for maintaining markets for their milk output. Milk pooled on Pacific Northwest Order 124 totaled 609.2 million pounds in October 2017.
Class I utilization accounted for about 27.5 percent of producer milk. The uniform price was $16.03, down $0.56 from last month but $1.07 above one year ago. Western condensed skim is accessible to Class II and IV producers.
Outputs are unchanged from last week. Cream is readily available to western processors. Butter production needs are met for many processors as the result some are looking for other outlets for their cream. The market for cream is unsettled as half & half and cream cheese makers are figuring out their end of the year holiday cream needs. Cream multiples for this week remain low at 1.00-1.27.
According to the DMN National Retail Report-Dairy for the week of Nov. 24-30, the national weighted average advertised price for one gallon of milk is $3.29, up $0.23 from last week, and $0.52 higher from a year ago. No advertised prices were reported in the Southwest and Northwest this week.