Fluid Milk and Cream - Western U.S. Report 4

California handlers report milk production is continuing to strengthen. January 2026 milk output is noted as up from December 2025 and year over year. Manufacturers convey open processing time is extremely tight, especially in the Central Valley. Spot milk loads continue to be available. Sellers note spot milk load sales down to $6 below the federal milk market order blend price. Stakeholders indicate there is some displaced milk volumes due to a facility closure at the start of the year, which has contributed to some distressed milk being sold to calf ranches. 

Farm level milk output in Arizona is stronger. Some manufacturers are bringing in spot milk on top of contractual intakes. 

New Mexico milk production various from steady to stronger. 

Farm level milk output is mixed in the Pacific Northwest. Some handlers convey untypical seasonal weather conditions negatively impacted cow comfort and milk output. Spot milk load availability and demand is mixed. 

Milk production in the mountain states of Idaho and Utah is strong. Handlers convey warmer than typical temperatures and lower than typical snowfall are positively impacting cow comfort and milk output. For Colorado, milk production is steady. Demand for all Classes is steady throughout the region. 

Although cream volumes are strong, stakeholders indicate there are fewer spot cream offers this week in some parts of the region. Cream multiples increased at the bottom end of the all-classes range for week 4. Condensed skim milk production, availability, and demand all remain mixed.

Thursday Midday Dairy Market Summary - Uneventful Cash Trade

OUTSIDE MARKETS SUMMARY:

CORN:	1 Higher
SOYBEANS:	Mixed
SOYBEAN MEAL:	$0.45 Higher
LIVE CATTLE:	$0.60 Lower
DOW JONES:	493 Points Higher
NASDAQ:	262 Points Higher
CRUDE OIL:	$1.55 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined 1 cent today, closing at $1.3500 with no loads traded. There was only one bid and one offer by the close. The barrel cheese price remained unchanged at $1.3575 with no loads traded. The dry whey price remained steady at 73.50 cents with no loads traded. Class III futures are 1 to 34 cents lower. The butter price was unchanged, closing at $1.46 with no loads traded. Grade A non-fat dry milk remained rallied 2.25 cents, closing at $1.2825 with no loads traded. Class IV futures are trading 33 cents lower. Butter futures are 0.5 cents to 1.05 cents higher. Dry whey futures are 0.5 cents lower. Cheese futures are 1.7 cent to 2.4 cents lower.

Thursday Morning Dairy Market Update - Buying Interest May Continue

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	2 to 6 Higher
Butter Futures:	2 to 3 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	4 to 5 Higher
Soybean Meal Futures:	$2 to $3 Higher
Wheat Futures:	2 to 3 Higher

MILK:

Class III milk futures are increasing in response to the gains in the block cheese and butter prices. The fundamentals have not changed much, but there may be some interest due to the impact of whole and 2% milk being made available for school lunches. That may not result in a significant increase in consumption, but it does provide an avenue for increased demand. USDA will release the January Milk Production and Cold Storage reports Friday.

CHEESE:

The block cheese price has been steady or higher for the past five consecutive days. The block price has finally moved above barrels, where it has not been for some time. Cheese production remains strong with sufficient milk supply. This may limit the upside price potential.

BUTTER:

The butter price continues to increase as buyers may have reached a level at which they may be more aggressive and outbid each other to purchase supplies before the price moves higher. Once the buying interest runs its course, there could be a void under the market. It is not certain that a bottom has been found.