November 2008 pool receipts of milk in California total 3.16 billion pounds, 0.1 percent lower than last year. Through 11 months of 2008, adjusted receipts are 2.6 percent higher than during the same period in 2007. The November blend price, at a fat test of 3.69 percent, is $15.17, $1.11 lower than October and $6.00 lower than November 2007. The percentage of receipts used in Class 1 products 14.92%. The November quota price is $15.97 and the over-quota price is $14.27. These prices are $1.17 lower than October and $5.96 less than a year earlier.

California milk production is steady at the year end at levels generally at or below a year ago. Several reports are stating the CWT herd reduction cows are being seen at slaughter auctions. Milk processing plants continue to run on extended schedules with many struggling to balance the heavy milk supplies. Class 1 sales are light, but there are better orders that will begin supplying school accounts. Cream markets remain weak with continued low-priced multiples and overages. There are numerous surplus offerings. Buyers are cautious with negotiations, especially as the butter prices and averages continue to decline.

There are reports that production of higher-class items will begin after Jan. 1. At the CME, butter prices closed at $1.14 on Tuesday, Dec. 30. Cream multiples are unchanged and range from 90-115 FOB and vary depending on class usage and basing points. Milk production in the Pacific Northwest is mostly steady. Processing plants are full as they handle local supplies and surplus milk from other areas. There are a lot of requests from California to handle surplus milk. Winter weather conditions are still affecting milk pickups and other transportation logistics in the region. Parts of Oregon had icy conditions to deal with, while other areas received rain.

Flooding is an unwanted potential problem. Utah and Idaho milk output is mixed in the region. Weather conditions of recent weeks are impacting some dairies. The declines in cheese prices and corresponding milk futures pricing are being noticed. While some costs of milk production have declined in recent months, they are well above what the milk futures indicate. Hay prices are slightly lower and more hay is available. Often dairies are only buying for nearby needs.  PD