Fluid Milk and Cream - Western U.S. Report 22

California handlers report steady or lighter milk production for week 22. Milk production is down from the previous month, but up yearover-year. Central Valley stakeholders report balanced milk volumes. Although some manufacturers indicate milk intakes below anticipated volumes, spot milk loads are available for buyers to secure. 

Arizona and New Mexico farm level milk output is steady. Spot milk loads are somewhat tight. 

Pacific Northwest milk production is steady. Manufacturers indicate milk volumes are tight. 

Handlers in the Mountain States of Idaho and Utah report close to ideal temperatures for cow comfort and steady farm level milk output. Handlers in Colorado indicate farm level milk output varies from steady to lighter. In many areas of the West region snowpacks were not heavy and stakeholders voiced nervousness about water resources for the remainder of this year. Some stakeholders throughout the region report increasing milk hauling rates. Class I demand is lighter with the start of summer breaks at educational institutions. Class II, III, and IV demands are steady. 

Cream demand and availability are steady. Cream multiples are unchanged for week 22. Condensed skim milk availability and demand are unchanged.

Thursday Midday Dairy Market Summary - Butter Shows Further Strength

OUTSIDE MARKETS SUMMARY:

CORN:	3 Higher
SOYBEANS:	9 Higher
SOYBEAN MEAL:	$2.90 Higher
LIVE CATTLE:	$1.60 Lower
DOW JONES:	59 Points Lower
NASDAQ:	82 Points Higher
CRUDE OIL:	$0.28 Higher

MIDDAY MARKET UPDATE:

The block cheese price declined 1.00 cent to close at $1.4875 with two loads traded. The price did trade down to $1.4850 during spot trading before coming back. The barrel cheese price remained unchanged at $1.44 with no loads traded. The dry whey price remained unchanged at 69.00 cents with no loads traded. Class III futures are 11 cents lower to 7 cents higher. The butter price gained 1.50 cents to close at $1.6350 with 30 loads traded. The price ranged from $1.6250 to $1.6700 during the spot trading period. There were 6 unfiled bids and 30 uncovered offers remaining at the close of spot trading. This may indicate the upside may be limited. Grade A nonfat dry milk slipped 0.75 cent to close at $2.0850 with 15 loads traded. Class IV futures are 7-50 cents higher. Butter futures are 0.80 -- 3.12 cents higher. Dry whey futures are 0.60 -- 0.90 cent higher. Cheese futures are 1.00 cent lower to 0.40 cent higher.

Thursday Morning Dairy Market Update - Traders Uncertain Over Continued Strength

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	10 to 20 Higher
Butter Futures:	1 to 2 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	4 to 5 Higher
Soybean Futures:	9 to 10 Higher
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	3 to 4 Higher

MILK:

Class III futures had some minor support on Wednesday from the increase in the block cheese price, but traders were not confident enough to buy futures aggressively. The decline in the barrel cheese price was a surprise, but it may have provided indirect concern for traders. The barrel cheese price has no influence on the calculation of the Class III price. Class IV futures were very strong as the increase in butter and nonfat dry milk prices triggered significant buying interest. The milk supply certainly is not lacking, keeping bottling and manufacturing active. More milk is being diverted to manufacturing as schools close for the summer.

CHEESE:

Cheese supplies remain plentiful. This will continue as more milk is moving to the vat. Cheese inventory is increasing, but remains slightly below a year ago. This is of no concern to buyers as there is sufficient available for demand.

BUTTER:

The increase in the butter price was the largest one-day increase we have seen for a while. Traders remain cautious over the upside potential. Butter futures were higher on Wednesday, but the gains were limited as there seems to be little reason to believe the strength will continue. Sellers may be aggressive in the spot market as they take advantage of the higher price.