Dune is right with needing to increase the cloud depth. The offset function needs a depth that covers the range that a band of cloud can be moved up and down.
Your valley dips to -215m from 100m so your cloud depth needs to cover this range, or where you want your effect to be. You'll shrink the cloud layer depth back down to 10m with the depth modulator. So if you set your cloud altitude to 0 and set it's depth to 400, this should cover your scene (-200m to 200m in y).
If you want your cloud layer to be 10m you need to divide the 400m by 10 to get the fraction of the whole you need to modulate the cloud depth modulator. In this case your depth modulator needs to be 40th of your cloud depth, so the depth modulator input constant needs to be 1/40 or 0.025. The Dm works by accepting a fraction of 1 (1 is full range, 0.5 is half, etc), to pull the height towards where ever the centre is set (in the function tab of the cloud node), default is 0, which is the bottom of the cloud layer, 1 would pull the base towards it's top. Unplug anything going into your altitude offset on the cloud node, and set it's internal function multiplier back to 1
So now the cloud should render flat at the bottom of your range, in this case -200 to -190.
Next you will need to get a signal from your terrain height to offset the altitude. Your PF is using it's internal displacement function, so you'll need to convert this output to an altitude range, by adding a displacement to vector (functions/convert), then that into a length to scaler. This output should now tally with your terrain's altitude.
Plug that into an add scalar node with a constant scaler of 200 (use this number to tweak the cloud level). Then that into the offset function of the cloud layer. The logic goes, if the terrain is at -200 we add 200 to create no cloud offset when it's base in the depth range is already at -200. If the terrain is -100 the offset into the cloud node will now be 100 (-100 + 200 = 100), so 100 ontop of the cloud node's base depth which is -200, = -100 your terrain height.
The cloud should now follow the contours of your terrain.