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Falling milk prices spurred largely by an imbalance between milkfat supply and demand have continued in recent months and may continue into 2026.
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| U.S. fluid milk sales in October were just 0.1% lower than a year earlier. Total domestic commercial use of milkfat was down moderately from a year earlier during June-August, while total skim solids use rose by 3%. U.S. exports of butter and American-type cheese were up by triple-digit percentages during July-September. Total U.S. milkfat production grew by 5.5% from a year earlier during August-October, almost two percentage points faster than liquid milk production during the same period. U.S. cheddar cheese production rose 3.2% year-over-year during August-October, down considerably from its 8.8% annual growth rate during May-July.
Prices for cheese, nonfat dry milk and dry whey showed moderate changes from September to November, but butter prices dropped by over $0.40/lb during the same period. Overall retail price inflation ticked down to a 2.7% year-over-year gain in November, while average retail dairy product prices dropped by 1.6% that month. The DMC margin dropped by $1/cwt from August to October, to $10.52/cwt, mostly on a drop of $0.90/cwt in the all-milk price, to $20/cwt. Note: Some of the data normally reported in the Dairy Market Report is still delayed due to the recent government shutdown. This issue reports the latest dairy data available. VIEW REPORT |
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