The Northeast and Mid Atlantic regions are experiencing substantial surplus milk, as Class I and Class II demand has declined due to the year-end holidays.

Churns and dryers are operating at capacity to handle the increased volumes, with some increase noted in cheese production. Some balancing plants were able to dry some medium and high heat non-fat dry milk (NDM) earlier in the holiday period, but are now drying nearly all low heat NDM to better handle the increased milk supply.

For the most part, the seasonal influx of milk is being managed without shipments backing up, but there were concerns that supplies may become burdensome over the New Year’s holiday. There was a balancing plant that experienced dryer problems, which caused unloading delays.

Milk production is increasing along seasonal trends. Recent winter storms in the Northeast have caused some delivery delays. Southeastern surplus supplies were managed without major difficulty, but there are concerns supplies may pose some problems. Class I orders were to pick up as bottlers prepared for schools to resume.

Florida milk production has increased along seasonal trends. The increased holiday supplies are being managed without problems and there were 125 out-of-state shipments.

Cream supplies, in general are heavy, but multiples did rebound as some manufacturers desired to get supplies in place to aid in production schedules prior to the New Year’s holiday. Some cream users are unsure of future supplies and are looking to contract more cream in 2010 than they did in 2009.

The condensed skim market is mixed. Class II condensed skim activity has been nominal and prices are steady to firm. Class III condensed skim prices have declined as some plants have moved condensed at below Class price in order to clear supplies.  PD