California milk production is steady to slightly higher when compared to last week, but down year over year. Contacts say post-peak flush milk volumes are still plentiful. In-state demand is surpassed by supply, and some milk spot loads are moving out of state. Class I demand is level. Class II and III orders are steadily strong, with some dairy processing plants operating at or near capacity.
Milk flows in Arizona continue to decline. Class I sales are lower; some bottling plants are reducing milk orders due to plant downtime and lower food service demand. These cuts are freeing up milk for balancing operations, enabling some dairy processors to meet production needs without having to bring in milk from other states. Milk demands are steady to stronger for all other Classes.
New Mexico's milk output is waning in the dry summer heat. Bottling sales are stable. Class II demand is steady to higher, and contacts say production is steady, but not stressed, for balancing operations.
In the Pacific Northwest, milk production is level to slightly increasing. Class I demand is firm. Cheesemaking is very active, keeping Class III sales elevated. Although some parts of Oregon are experiencing drought conditions, recent reports indicate other areas of the state have received over 40 inches of rain so far this year. Soggy fields, resulting from heavier than average precipitation, are causing some delays for dairy farmers trying to plant corn and harvest forages.
Farm level milk output is flat throughout the mountain states of Idaho, Utah, and Colorado. Bottling sales are steady. Demand is unchanged for all other Classes.
Demand for condensed skim remains firm. Loads are available to satisfy contract and spot needs. Some end users are purchasing additional spot loads on top of contracted loads. Cream demand is fairly steady across the West, but spot availability varies. In the heat of the Southwest, cream is tight and some contacts report limited spot load offers. Further north, market participants say cream is more available, but high freight costs and limited truck/driver availability hamper its movement in some cases. Ice cream manufacturing is seasonally active. Western cream multiples are holding firm on the bottom of the range this week, but the top of the range inched higher.
Western U.S., F.O.B. Cream
Multiples Range - All Classes: 1.0500 - 1.3300
