MD_DA240

     Fluid Milk and Cream - Western U.S.

     Report 24 - Released on June 13, 2019

     Fluid milk production is steady to declining in California. Despite Recent high
     temperatures, milk components haven¶t changed much. Milk supplies continue to be adequate
     for most processing needs. Bottled milk intakes are mixed with some high and low requests
     reported. There have also been some out-of-state sales to balance milk volumes. Arizona milk
     is steadily flowing without any issues from dairy farms to manufacturing facilities. Milk
     loads are available to fulfill all demand in the state despite steady to lower output.
     Though, the supplies going to balancing facilities is decreasing. Class I sales are stable,
     whereas Class II is level to up. New Mexico milk volumes are lower compared to last week,
     but holdovers are higher because of unplanned repairs and maintenance works. A few plants
     had to reduce their daily intakes and focus on fixing issues with their machines. Class I
     and III sales has improved, but Class II demand is trending lower. A combination of lower
     milk output and lower overall demand helped in keeping milk loads balanced in the New
     Mexican dairy market. Pacific Northwest milk intakes are lower than expected according to
     some industry contacts. This equivocal view of the milk supply suggests an expectation of
     heavy milk provisions, and yet, production appears to be in relatively good balance with
     processing needs. While the region is at or near spring flush, some contacts relay they
     could take in more milk if it was available. Recent hot weather may be slowing milk
     production, but probably minimally. Cooler nights are allowing cows to recharge and is
     keeping milk production generally steady. Cream supplies are in demand from butter and Class
     II manufacturers. So far, cream availability is adequate to meet most needs, but a
     continuation of heat may reduce components and place more challenges for cream users.
     Bottling demand has regulated back into typical summer patterns as most educational
     institutions are on summer break, and summer meal programs have replaced school lunch
     programs. Milk production in the mountain states of Idaho, Utah and Colorado is steady.
     Favorable weather has been conducive to cow comfort. Dairy contacts say milk intakes are in
     good balance with processing needs. The occasional processing facility hiccup may push a few
     loads of milk into the surrounding area, but most loads are able to find a home quickly. Hay
     harvesting is moving ahead at earnest and area contacts suggest there is plenty of water for
     irrigation. Western condensed skim sales are consistent with expectations, but spot loads
     are almost nowhere to be found. Overall, there is a steady flow of condensed skim to nonfat
     dry milk producing plants. Cream stocks are adequate for most contractual requirements, but
     they are a bit restricted for spot needs. With hotter weather conditions in many areas of
     the West, cream availability is expected to further decline. Class II cream multiples are
     expensier, reaching the 1.28 mark, whereas cream multiples for all Classes have plateaued at
     1.25. There are reports that more cream is going to Class II production, causing in some
     instance inadequate supplies of cream for butter churns.

     National Retail Report Dairy ± Fluid Milk Summary
     Advertised Prices at Major Retail Supermarket Outlets ending during the
     period of 6/07/19 to 6/13/2019

     Half Gallon, All Fat Tests                 Weighted Average Price
     National                          This Period       Last Week      Last Year
      Organic                            $4.09             $3.90          $3.61
      Conventional                       $1.26             $1.54          $2.10

     Regional (Organic)                 Wtd. Ave.           Low            High
     Northwest                           $3.70             $2.49          $3.99

     Gallon, All Fat Tests                      Weighted Average Price
     National                          This Period       Last Week      Last Year
      Organic                            $6.02             $5.99          $5.42
      Conventional                       $2.78             $2.38          $2.95

     Regional (Conventional)            Wtd. Ave.           Low            High
     Northwest                           $1.99             $1.99          $1.99
     Southwest                           $2.98             $2.98          $2.98

     Regional (Organic)                 Wtd. Ave.           Low            High
     Northwest                           $5.00             $5.00          $5.00

     Western U.S., F.O.B. Cream
     Multiples Range - All Classes:               1.1200 - 1.2500


     Information for the period June 10 - 14, 2019, issued weekly
     Published by:
     Dairy Market News - Madison, WI
     FLORENCE KONE-GONZALEZ, (608)422-8594
     Email: Florence.KoneGonzalez@usda.gov
     MIKE BANDLI, (608)422-8592
     Email: Michael.Bandli@usda.gov

     Additional Dairy Market News Information:
     Dairy Market News (DMN) by Phone: (608)422-8602
     DMN Website: https://www.ams.usda.gov/market-news/dairy
     DMN MARS (My Market News): https://mymarketnews.ams.usda.gov/