Water can get in if it's stored outside, and it will emulsify in the oil. You can get some of it out, but the majority will be held in suspension.
If it's antifreeze, is there a hydraulic oil cooler? It could be leaking, same thing, the antifreeze will mix with the oil and be held in suspension.
Once you find the source, drain it best you can, leave it draining over night. Then do a partial fill, cheap stuff will do, run through all the motions, drain it again. If there is a filter, change it, then fill it with the good oil. It may still be a little milky, but will clear up as the water boils off.
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Today's Featured Article - Women and Tractors - More Views From the Farmer's Wife - by Teri Burkholder. The top ten reasons why the judges wouldn't let you participate in the stock antique tractor pull: Hey, this is stock! It came with that V8 in it! That "R" on my tires stands for "really old" not radial! Blue gas? We thought it was a pretty color! What wire hooked to my throttle?
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