Fluid Milk and Cream — Western U.S.
Fluid milk production is stable in California after recuperating from the previous decline. The current hot weather is keeping milk output from increasing. In addition, component levels have recently dropped. Milk is flowing to processing plants as scheduled. Bottled milk requests are the same as last week. In Arizona, processors have enough milk loads for their daily activities despite recent drops in milk output. Class I sales are unchanged compared to the previous week. Class II demand is stronger due to the ongoing demand to satisfy ice cream production needs. Butter makers have slowed down their operations as they manage to sell some of their cream. In New Mexico, a combination of lower output and higher demand has put downward pressure on milk supplies. As the result, milk clearing into balancing is lighter than usual. While Class I and III sales are up, Class II demand has declined. There was no surplus of milk reported in the state because manufacturers have just what they need to fulfill processing requirements. Favorable weather in the Pacific Northwest continues to support strong milk production. In eastern Washington, higher daytime temperatures are cutting into very strong milk output volumes, but only minimally, as cooler nighttime temperatures allow cows to recharge. Manufacturers have plenty of milk available for processing. Bottling demand is steady. Milk output in the mountain states of Idaho, Utah and Colorado is strong and may be at peak production levels. Late last week, several plants had scheduled or unscheduled shutdowns causing a ripple across milk transportation channels. Milk handlers suggest manufacturing facilities are at capacity and with the hiccups, they needed to juggle load deliveries. Condensed skim availability is trending lower, following the same path as milk production. Condensed skim prices are also variable by state. The Western cream market has kept the same strength as in the week before. Demand is ongoing and unchanged. Inventories are available for contractual buying, but a bit limited to satisfy spot requests. Buyers are hesitant about buying cream when cream multiples reach the 1.30s mark. Higher freight costs are also limiting cross regional trades. National Retail Report Dairy ± Fluid Milk Summary Advertised Prices at Major Retail Supermarket Outlets ending during the period of 7/19/19 to 7/25/2019 Half Gallon, All Fat Tests Weighted Average Price National This Period Last Week Last Year Conventional $1.95 $2.17 $1.97 Organic $3.49 $3.82 $3.83 Regional (Conventional) Wtd. Ave. Low High Northwest $1.99 $1.99 $1.99 Southwest $2.99 $1.99 $3.99 Regional (Organic) Wtd. Ave. Low High Southwest $4.31 $3.99 $4.99 Gallon, All Fat Tests Weighted Average Price National This Period Last Week Last Year Conventional $2.80 $2.69 $2.67 Organic $5.45 $6.35 $6.99 Regional (Conventional) Wtd. Ave. Low High Northwest $3.50 $1.99 $5.00 Southwest $2.57 $1.99 $2.75 Western U.S., F.O.B. Cream Multiples Range - All Classes: 1.1500 - 1.3100 Information for the period July 22 - 26, 2019, issued weekly Secondary Sourced Information: The NASS Milk Production report noted June 2019 milk production in the 24 selected states was 17.3 billion pounds, 0.1 percent up a year ago. Milk cows in the 24 selected states totaled 8.78 million head, 62,000 head less than a year ago. The following table shows western states included in the report and the monthly milk production changes compared to a year ago: June 2019 Milk Production, (USDA-NASS) (Million Lb.) % Change From 1 Year Ago Arizona 394 - 4.6 California 3344 + 1.2 Colorado 405 + 6.0 Idaho 1303 + 2.0 New Mexico 687 - 2.8 Oregon 215 + 1.4 Utah 193 - 3.0 Washington 569 + 0.2