Fluid Milk and Cream — Western U.S.

Sept. 5

The California milk market is following seasonal norms when it comes to the Labor Day
     manufacturing activities. Demand for Class I was a bit down. Balancing schedules were more
     active at the beginning of the week, but are back to normal now. Milk supplies are plentiful
     to meet all requests. Production is steady compared to last week. Arizona milk volumes
     produced are unchanged from a week ago. There was no need to bring in out-of-state milk as
     offers within the state were enough to satisfy all buying obligations. Fluid milk sales are
     stable to down. Milk production is adequate to fill the needs of all New Mexico
     manufacturing facilities. Class II and III demands are up, whereas Class I sales are down.
     Milk balancing volumes are declining bit by bit after the holiday. Processing machines are
     running near full capacity. There were a few repair and maintenance workloads that had minor
     impacts on dairy plants' operations. While overall milk production in the Pacific Northwest
     is steady to lower, warm days and cool nights have provided good cow comfort, keeping milk
     output levels strong. Manufacturers report having plenty of milk for processing needs.
     Bottlers are getting the school pipelines refilled, and the skimming is freeing up a bit
     more cream for Class II and butter production. Idaho, Utah and Colorado milk production
     remains strong. Milk output is in generally good balance with processing needs, however a
     few loads of discounted milk are available at $4.75 under Class IV. Dairy manufacturing
     facilities are running at or near capacity. Condensed skim processing is mostly steady in
     the West. Supplies are readily available. There is a slight uptick in butter churning this
     week as cream is more present in the market. Ice cream makers are requesting less cream.
     Multiples for all Classes are 1.05-1.29, down 0.02 at the top of the range.

     National Retail Report Dairy ± Fluid Milk Summary
     Advertised Prices at Major Retail Supermarket Outlets ending during the
     period of 8/30/19 to 9/5/2019

     Half Gallon, All Fat Tests         Weighted Average Price
     National                    This Period   Last Week   Last Year
     Conventional                   $2.03        $2.30       $2.49
     Organic                        $4.12        $3.90       $4.22

     Regional (Organic)           Wtd. Ave.       Low         High
     Northwest                      $3.99        $3.99       $3.99

     Gallon, All Fat Tests              Weighted Average Price
     National                    This Period   Last Week   Last Year
     Conventional                   $3.21        $2.53       $2.83
     Organic                        $7.40        $5.79       $7.49

     Regional (Conventional)      Wtd. Ave.       Low         High
     Southwest                      $3.57        $2.98       $3.99

     Western U.S., F.O.B. Cream
     Multiples Range - All Classes:               1.0500 - 1.2900

     Information for the period September 2 - 6, 2019, issued weekly

     Secondary Sourced Information:

     Dairy Products Report - Ice Cream, Regular, Hard
     Released September 4, 2019, by the National Agricultural Statistics Service (NASS),
     Agricultural Statistics Board, United States Department of Agriculture (USDA).

     Ice Cream, Regular (Hard) Production ± States and United States
                                   Monthly Production (1000 pounds)    Percent Change from
     Total Cream, Regular (Hard         July     June      July           July     June

     Region                             2018     2019      2019           2018     2019
     United States                    68,966   66,462    66,081           -4.2     -0.6

     Atlantic                         14,761   13,702    14,430           -2.2      5.3
       Pennsylvania                    3,530    3,412     3,620            2.5      6.1

     Central                          40,379   40,762    39,255           -2.8     -3.7
       Missouri                        3,308    3,335     2,765          -16.4    -17.1
       Ohio                            2,831    2,443     2,815           -0.6     15.2
     West                             13,826   11,998    12,396          -10.3      3.3
       California                      7,389    6,562     6,968           -5.7      6.2
       Oregon                          1,450    1,261     1,408           -2.9     11.7
       Utah                            2,839    2,050     1,670          -41.2    -18.5

     Ice Cream, Regular (Hard) ± Cumulative Production January - July
                                   Cumulative Production  Percent Change
                                        (1000 pounds)        from
     Report Month                       2018     2019        2018
     July                            439,285  431,948        -1.7

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