Cream demand increasing
Northeast milk production continues its seasonal increase, with intakes being readily handled. Seasonal cream cheese production continues to generate increased spot market cream sales. There has been a temporary decline in cream needed for ice cream production in some locations due to installation of new equipment to package ice cream in smaller single-serving containers targeted for new market niches. Ice cream manufacturing demand for cream is expected to increase again soon.

Nonfat drying is strong, but not at full production levels.

Organic dairy farming has recently become the fastest-growing agricultural sector in New England, with Maine leading the region and the U.S. in having the highest percentage of organic producers compared with conventional farms. Recently, a number of Maine organic dairy farms were notified by their buyer of contract non-renewal or production reductions, due to diminishing demand during the recession.

Middle Atlantic plants report ample milk supplies. There is heavily increased demand for cream related to seasonal cream cheese production. Some plants in the region have stopped churning to sell cream to other plants manufacturing cream cheese.

Some southeast plants were in their words, “scrambling” to get and move milk due to the impact of a Northeast snow storm to begin the month. Some milk originally sent to manufacturing plants was subsequently diverted for fluid use due to varied shipment disruptions affecting other plants. In a number of instances, milk tankers were delayed by up to one day, which contributed to challenges in the region.

Florida production has continued to increase and this led to more loads of milk leaving the state. Production is believed to be nearing the expected seasonal peak although plant managers are not yet certain whether this point has been reached. Cool weather for Florida, comfortable for cows, was a factor supporting increasing production.

Condensed skim markets have cleared much of the Class III that brought the spot market somewhat lower. Interest has now returned to more normal recent levels. Seasonal production leading to Easter and the Jewish Holy Week is motivating high levels of cream cheese production – up to three times normal levels.  PD