Fluid Milk and Cream - Western U.S. Report 31

Milk production in the West region is seasonally low, but several areas note a recent increase in farm milk output after some recent hot weather. The Central Valley of California milk volumes are down in July compared to June of this year, but year over year production is higher than 2025. Some contacts in California are concerned with scheduling downtime for regular maintenance with milk volumes this high. 

Arizona and New Mexico milk production is steady with no noted changes to volumes. 

The Pacific Northwest has no notable changes in milk production. 

The mountain states of Idaho, Utah and Colorado have seasonally steady milk production. 

Cream demand in the region is growing. Cream multiples increased at both ends of the range this week. Contacts indicate multiples could continue to rise if demand doesn't change. Demand for Class I milk is growing in some areas as schools prepare for the fall semester. Class II - IV demand remains unchanged in the region. Butter churns are receiving contracted volumes of cream as Class II facilities are taking the majority of spot cream. Condensed skim milk is readily available in the region.

Thursday Midday Dairy Market Summary - Butter Price Jumps

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	1 Higher
SOYBEAN MEAL:	$0.40 Higher
LIVE CATTLE:	$2.87 Higher
DOW JONES:	557 Points Higher
NASDAQ:	642 Points Higher
CRUDE OIL:	$0.50 Lower

MIDDAY MARKET UPDATE:

The block cheese price slipped 1.25 cents to close at $1.5325 with two loads traded. The barrel cheese price declined $0.50 to close at $1.5475 with one load traded. The dry whey price increased 1.25 cents to close at 68.25 cents with one load traded. This offset the decline of the block cheese price. Class III futures are mixed, ranging from 13 cents lower to 14 cents higher. The July contract is the lowest as the price adjusted to the weekly AMS prices. The butter price jumped 9.00 cents to close at $1.4800 with five loads traded. There were five unfilled bids and 83 uncovered offers. Grade A nonfat dry milk increased 5.25 cents to close at $1.5000 with eight loads traded. Class IV futures are 6-66 cents higher. Butter futures are 0.72 cent lower to 5.95 cents higher. Dry whey futures are steady to 0.35 cent lower. Cheese futures are 0.80 cent lower to 1.20 cents higher. Nonfat dry milk futures are 1.30 -- 4.95 cents higher.

Thursday Morning Dairy Market Update - Class III Milk Futures May Struggle

OPENING CALLS:

Class III Milk Futures:	4 to 8 Lower
Class IV Milk Futures:	5 to 10 Higher
Butter Futures:	1 to 2 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Higher
Soybean Futures:	2 to 3 Higher
Soybean Meal Futures:	Mixed
Wheat Futures:	19 to 23 Higher

MILK:

Class III milk futures are back down near the lows and may have a difficult time rebounding. Spot prices will need to find support and trend higher before traders will buy into the market with any confidence. The market will need to prove itself before buying interest is generated. Traders continue to scalp the market rather than take any long-term positions. Milk receipts at the plant level have increased slightly after cows recover somewhat from the hot weather. There is sufficient milk available for bottling and manufacturing demand.

CHEESE:

Cheese prices may show further weakness as buyers remain unaggressive. As long as sellers offer supplies on the spot market, buyers will hold for lower prices. There is no concern over the tightness of cheese supplies. Even as bottling increases for school accounts, sufficient milk supplies will remain for manufacturing.

BUTTER:

It is uncertain whether the butter price has found support. It was good to see the price increase a penny on Wednesday despite the heavy volume of loads traded. However, the large amount of offers remaining at the close of spot trading suggests butter supplies are plentiful with limited upside price potential.