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Fluid Milk and Cream — Western U.S.

The butter churning activity is steady, but is likely to change with the approaching of the holiday season.

Published on October 5, 2018 1:58PM


FLUID MILK AND CREAM

REVIEW – WEST

(USDA Market News)

Oct. 4

In California, milk production is generally flat. Some plant managers say that they are receiving more milk than expected, but they have enough capacity to handle all the milk volumes.

However, in the southern part of California, there have been some reports of milk deficit. As such, milk prices are higher in that area. Class 1 sales haven’t changed from last week.

Milk/cream transportation is currently a big issue due to limited drivers/trucks.

In Arizona, slightly favorable weather conditions are helping milk production to remain steady. Milk intakes into both Class I and II customers are firm. The butter churning activity is steady, but is likely to change with the approaching of the holiday season. Some cream continues to find its way out of state to satisfy short term buyers’ needs.

Altogether, the market tone is steady. Supplies and demand of milk are in good balance. New Mexico milk production is stable and in line with the needs of the industry.

Component levels are improving week by week. There are not any major issues with milk processing. Some loads of milk are being delivered to the Southeast region as milk availability is restricted in that region.

Although New Mexico has enough milk to satisfy the needs of the Southeastern customers, hauling is a major concern. Therefore, New Mexico handlers are shipping milk to the Southeast based on trucks/haulers availability. In some cases, customers from the Southeast had to bring their own trucks for milk pick up.

Class I sales are down this week while Class II sales held steady. Class III demand is fixed to slightly down.

Pacific Northwest milk production continues to clip along at a steady pace. Intakes are following typical seasonal patterns without any surprises for milk handlers.

Bottling demand has stabilized with the reliable pull from educational institutions.

Manufacturers report getting plenty of milk needed for processing.

Milk production in the mountain states of Idaho, Utah and Colorado is heavy, but generally in good balance with processing needs.

Manufacturers have access to plenty of milk. Variations of milk demand due to buyers’ needs fluctuating or maintenance at manufacturing facilities are forcing milk handlers to recalibrate milk flows within the region from time to time. Condensed skim is plentiful, and some plant managers are looking for alternative ways to clear it.

Cream is a little tighter this week in the West. Nonetheless, most end users/buyers’ needs can be fulfilled if trucks/drivers are found for milk hauling.

In California, cream market participants are more concerned about hauling limitations than cream availability. Cream multiples for all Classes remain at 1.10-1.28. Nonetheless, most sales are taking place in the range of 1.15-1.25.

Advertised milk prices at major retail supermarkets ending during the period of Sept. 28:

Organic: $6.17/gallon all fats

Conventional: $2.35/gallon all fats

According to the California Department of Food and Agriculture, the September 4a price (butter/powder) in California is $14.09, up $0.04 from the previous month, but down $1.60 from a year ago. This compares to the Federal Order Class IV price of $14.81 for September.

The September 4b price (cheese) is $15.62 up $0.56 from the previous month, and $0.74 higher from a year ago. This compares to the Federal Order Class III price for September at $16.09.



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