Fluid Milk and Cream — Western U.S.

Sept. 19

California milk output is stable this week. Supplies are accessible to all processors. Class I demand from retailers and educational institutions is unchanged from a week ago, whereas Class II offers are a bit more available.

In Arizona, the milk market is balanced. Milk loads offered are sufficient to meet current needs; therefore, no milk is coming from out of state. Weather conditions have not much impacted milk production in recent days. Class III demand is trending higher, while Class I and II sales are stable.

In New Mexico, the milk flowing to Class III accounts has sharply declined. This is partly due to a downtime at one of the major cheese manufacturing plants in the state. To prevent milk from going to waste, many loads moved to Class IV production. Class I demand has improved throughout the week, but Class II sales moved in the opposite direction of Class I. Milk supplies and production are at the same levels as in the prior week.

Milk production in the Pacific Northwest remains strong. Industry contacts say milk intakes are above last year, and milk components have held at higher levels. Although milk output has eased back from the early summer highs, there is plenty for most processing needs. In addition, with the school milk pipeline filled and ice cream production cutting way back, there are abundant supplies of cream for butter and other Class II products.

Mountain states (Idaho, Utah and Colorado) milk production is steady and strong. According to the latest Milk Production report, Idaho and Colorado have added milk cows to the herd. As a result, most manufacturers are running their facilities at or near full capacity. Industry contacts say spot milk loads are regularly available in Idaho at $4.75 below Class IV.

Western condensed skim demand has been flat. some loads are going to cheese plants. Cream continues to be widely available to buyers. According to market participants, cream supplies are less tight than they expected for this time of the year. Lower multiples in the Midwest are preventing western cream sellers from getting a competitive advantage in that region. More cream is clearing to the churns. Cream multiples for all Classes remain steady.

National Retail Report for Fluid Milk

Advertised Prices at Major Supermarkets

Sept. 19

(Half Gallon, All Fat Tests Weighted Average Price)

Conventional: $2.65

Organic: $3.88

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