Fluid milk and cream review — West
Industry contacts say approximately 3,000 cows were removed from the milk shed in Idaho due to difficulties in finding a stable year-round market for the milk.
California milk production is up compared to last week. However, milk prices in the spot market continue to be higher. Milk supplies are sufficient to meet processing obligations.
Nonetheless, some Manufacturing plants continue to run near or below full processing capacities. Milk intakes are in good balance. Class I requests into bottling plants are steady.
In 2017, 5.2 million tons of alfalfa hay and alfalfa mixtures hay were produced in California, compared to 5.0 million tons in 2016. Although alfalfa production increased this year, market participants indicate that prices are higher this year compared to last year for all hay varieties.
According to CDFA, September 2017 Class 1 sales in California totaled 51.7 million gallons, down 1.7 percent from last month, and down 4.7 percent from the previous year.
From January through September 2017, Class 1 sales totaled 462.8 million gallons, down 3.6 percent from the comparable period in 2016. The October 4a price (butter/powder) in California is $14.51, down $1.18 from the previous month, but $1.40 higher from a year ago.
This compares to the Federal Order Class IV price of $14.85 for October. The October 4b price (cheese) is $16.17, up $1.29 from the previous month, and $1.74 higher from a year ago. This compares to the Federal Order Class III price for October at $16.69.
Milk yield in Arizona is rising this week. Schools that were out on their fall break are back in session. As a result, most handlers are back to taking their usual Class I loads.
Class IV milk sales to butter makers are solid. Some contacts report that condensed skim is moving strongly from Arizona into California.
In Arizona, alfalfa hay is rated 73 percent good to excellent, with harvesting taking place on 70 percent of the alfalfa acreage.
New Mexico farm milk production is increasing following seasonal patterns. With strong milk orders throughout the week, milk holdovers are starting to decrease.
Class I and III demands are trending up while Class II demand is down. Processing plants are working at or near full processing capacities.
In New Mexico, topsoil moisture levels were 82 percent adequate to surplus, as opposed to 27 percent last year and 32 percent for a 5-year average.
Milk production in the Pacific Northwest is balanced pretty well. Adequate volumes of milk are finding their way to bottlers and processors. Manufacturers are taking just a little more milk when they can to stay ahead of the holiday rush.
In the mountain states of Idaho, Colorado and Utah, processors say there is plenty of milk available. While increased processing capacity in Colorado is keeping milk in good balance.
Industry contacts say approximately 3,000 cows were removed from the milk shed in Idaho due to difficulties in finding a stable year-round market for the milk. Milk output is now near its seasonal low for the year.
The market for condensed skim is stable in the West. Western contacts report that cream buyers are trying to negotiate lower prices for 2018 cream contracts.
The market for cream seems to be in good balance.
In the West, cream intakes for butter manufacturing are still strong.
Multiples for this week are 1.12-1.28. According to the DMN National Retail Report-Dairy for the week of October 27-November 2, the national weighted average advertised price for one gallon of milk is $2.84, up $0.59 from last week, and $0.30 higher from a year ago.
The weighted average regional price in the Southwest is $2.61, with a price range of $2.39-$3.00. This week, no advertised ads were reported for one gallon of milk in the Northwest.