MD_DA240
DA
MD DA240 FLUID MILK AND CREAM REVIEW - WEST

Madison, WI November 19, 2009
For the week of November 16-20, 2009 (REPORT 46)

WEST FLUID MILK 

According to the NASS Milk Production report for October, 
Output for the 23 States totals 14.3 billion pounds, down 
1.1% from 2008.  Output for the U.S. is 15.4 million 
pounds, down 1.1% from last year and the largest year over 
year decline since the first quarter of 2004.  Output for 
selected Western states compared to last year is as 
follows:  Arizona -10.6%, California -5.3%, Colorado -
8.9%, Idaho -1.4%, New Mexico -0.2%, Oregon -0.5%, Utah -
1.3%, and Washington -0.9%.  Cow numbers in these same 
eight states are down 145,000 from last year.  The changes 
for selected Western states are as follows:  Arizona -
20,000 head, California -78,000, Colorado -14,000, Idaho -
8,000, New Mexico -17,000, Oregon -1,000, Utah -2,000, and 
Washington -5,000.  Prices for alfalfa hay in the Western 
region, according to NASS, continue to decline compared to 
last year.  The mid-October price for the U.S. was 
$109/ton, down $63 from last year.  Prices for selected 
Western states and the change from last year are as 
follows:  Arizona $105, -$85; California $98, -$102; 
Colorado $135, -$30; Idaho $115, -$114; Nevada $99, -$90; 
New Mexico $141, -$48; Oregon $120, -$106; Utah $105, -
$40; and Washington $120, -$120.  Quarterly replacement 
milk cow prices, according to NASS, are down sharply from 
last year.  For the U.S., the October price was $1240, 
down $680 from a year ago.  Prices for selected Western 
states compared to last year are as follows:  Arizona 
$1350, -$700; California $1200, -$900; Colorado $1300, -
$800; Idaho $1250, -$850; New Mexico $1280, -$750; Oregon 
$1300, -$700; and Washington $1200, -$800.  CALIFORNIA 
milk production is steady to occasionally slightly higher 
as conditions are mostly favorable for milk cows. Some 
areas of the state had rain, but no problems have been 
noted.  Processing plants have capacity and expect no 
problems handling the milk supplies over the upcoming 
holiday week and weekend.  Milk and components are being 
brought into the state to help mitigate needs.  ARIZONA 
milk output is mostly steady with some slight daily 
changes noted.  Overall, volumes are lower than needed.  
Processors have reduced and rebalanced production 
schedules around the incoming milk volumes.  Bottlers are 
planning for and beginning to adjust for higher bottled 
milk needs ahead of the Thanksgiving holiday next week as 
well as school and college recesses.  CREAM prices moved 
higher and the market is firm.  Buyers are looking for 
cream for multiple product manufacturing ahead of the 
holidays and are pulling cream in from long distances as 
well as bidding cream prices higher.  At the CME Group at 
midweek, butter closed at $1.5250, unchanged from a week 
earlier.  Cream multiples range 118-145 FOB and vary 
depending on class usage and basing points.  Conditions 
have been very wet west of the Cascades in both WASHINGTON 
and OREGON for the past week at least.  Some high winds 
with the storms also caused some power outages.  Snow 
levels are down to pass levels so that some transportation 
is being impacted.  The farm milk supply is not suffering 
any real consequences at this time.  Plants are preparing 
for the holiday next week with offerings of milk gyrating 
both higher and lower in a short period of time.  Dairy 
farms in the region are purchasing and taking delivery of 
more hay volumes in the last few weeks.  Some of the 
financing options are more creative than in past years.  
Some cold, early winter conditions have occurred over 
parts of UTAH and IDAHO in the past week or so.  
Temperatures have fallen into the single digits and snow 
has fallen in the valleys.  Good snow cover is reported on 
top with many ski areas opening.  Alfalfa and wheat crops 
look good going into the winter.  Stocks of good quality 
dairy hay may be a concern as quite a bit of the first 
cutting had rain damage.  Drying plants continue to 
scramble for milk supplies to be able to run efficiently 
which they are having trouble doing with milk supplies in 
the region lower.  Heifer prices at a weekly sale are 
about steady with the average around $1280 and the top of 
the market $1420.  

1100CT 
Butch.Speth@ams.usda.gov 608.250.3202
Donaldo.nelson@ams.usda.gov 608.250.3206