The commodity markets swung wildly back and forth this week, buffeted this way and that by politics and anxiety. While the U.S. economy continues to expand, growth is uneven. Lower-income consumers are struggling, and many middle-class Americans are watching their budgets more closely. They’re dining out less and seeking bargains when they do. Many shoppers are trading down to store brands or switching to discount retailers. This week, the Trump administration and a federal j

Falling international prices spooked the U.S. milk powder market. At this week’s Global Dairy Trade (GDT) Pulse auction, skim milk powder (SMP) prices fell 0.7% from last week’s GDT event, dropping to a 13-month low of $2,530 per metric ton, equal to nonfat dry milk (NDM) at around $1.22 per pound. Whole milk powder prices slipped 0.9% to a one-year low. Manufacturers in Europe and Oceania are flush with milk, and dryers are...

Dairy markets both in the U.S. and across the globe continue to feel out the balance of supply and demand. Although the dramatic price decreases seen during the last few weeks have given way to more modest movements, the overall market tone remains bearish. Tuesday’s Global Dairy Trade (GDT) auction, albeit glitchy, ultimately saw the GDT Price Index move down 1.4%, the fifth consecutive lower result. The decline in the index reflected lower prices across every product except

The dairy industry is the victim of its own success. Heavy milk output continues to weigh on milk and dairy product prices. USDA’s Dairy Market News reports that in California, milk production tops year-ago levels by a wide margin, “edging into double digits.” The eye-popping year- over-year increase can be partially explained by the onset of the devastating bird flu last year and the healthier herd today. That does not change the fact that the market has significantly more..

As the government shutdown stretches into its second week, the dairy industry continues to operate without access to key data. To this point, the main information gaps for the dairy sector include numbers for trade and dairy product output. However, if the shutdown persists, upcoming reports on milk production and inventories will also be missed, further obfuscating stakeholders’ understanding of market drivers. 

The dairy markets continue to lean bearish, as milk output grows around the world. But that doesn’t mean that prices must move downward constantly. After several weeks of steep declines, the dairy markets regained a little ground this week. On LaSalle Street, traders describe this as a healthy correction in a bear market. 

Milk is absolutely gushing out of the U.S. dairy industry. Milk production reached 19.52 billion pounds in August, up 3.2% from a year ago. USDA revised its estimate of July milk output and cow numbers upward significantly. The agency now reports that dairy producers added 35,000 cows in July and another 10,000 head in August. That put the August milk-cow herd at 9.52 million head, larger than at any time since late 1993 and up 176,000 head from a year ago.

Following last week’s dramatic downward movement, the dairy markets tried to regain some traction this week. Yet, despite a few flashes of stronger prices, the market tone remains overwhelmingly bearish as participants come to terms with the scope of the increase in global milk supplies.

There were no bulls to be found on LaSalle Street this week. The bears roamed freely, showing no fear of an overcorrection even as parts of the dairy complex scored multi-year lows. Red ink poured into the cheese and milk powder trade and deluged the butter market. CME spot butter plummeted to $1.86 per pound, down 16.25ȼ in just five trading sessions. Spot butter is down more than 40% from the mid-summer high, languishing at its lowest level since October 2021, nearly four y

The selloff continued on LaSalle Street this week. Robust production of high-component milk is keeping churns and vats full and weighing on dairy product prices. After the close today, USDA detailed how processors are divvying up the growing milk supply with its monthly update to the Dairy Products report.

The butter market melted down. CME spot butter plummeted 19ȼ this week to $2.045 per pound, its lowest price in nearly four years. Last week’s Cold Storage report showed that inventories were not burdensome as of July 31. But more recent commentary from USDA’s Dairy Market News suggests that stocks are starting to pile up. U.S. butter is the cheapest in the world – by far – and exports remain strong. But America’s dairy cows are simply cranking out too much high-fat milk, esp

The dairy markets have lost that summer sizzle. Prices plummeted this week on the heels of a Milk Production report that confirmed heady growth. Unseasonably cool overnight temperatures and another 10,000 cows pushed milk output upward in July. Production totaled 19.57 billion pounds, up 3.5% from July 2024. Once again, components supercharged the growth. The U.S. dairy herd made 4.7% more butterfat, 4.4% more protein, and 3.8% more nonfat solids than it did last July. 

The backpacks are ready, the bus schedules are finalized, and milk bottlers are ramping up output. It’s back-to-school season in much of the country. But it’s still hot, and milk output is slipping. USDA’s Dairy Market News says milk is tight in the East. In the Central and West regions, output is declining seasonally, but there is more milk than there was a year ago. Cream production is slipping across the nation, but, as ice cream manufacturers wind down, there is plenty of

As summer moves into the home stretch, the spot market for milk is tightening up. The typical seasonal decline in milk production has combined with hot and sticky summer weather in some areas to push down on output. At the same time, bottlers are preparing for the start of the school year and have begun to increase their demand, further reducing milk availability for manufacturers. As a result, processors in the Upper Midwest this week paid a...

The dairy markets are showcasing the colorful – and somewhat morbid – Wall Street adage: “Even a dead cat will bounce if it falls from a great height.” This week milk futures managed a modest recovery, briefly interrupting the dramatic downtrend. Most Class III futures contracts added just a few cents, but the September contract rallied 21ȼ to $17.73 per cwt. Most Class IV futures climbed roughly a nickel. The September contract closed at $19.10.

U.S. dairy producers are keeping cows in their barns rather than sending them to the slaughterhouse. Through mid-July, dairy producers culled 1.38 million milk cows. That’s 310,000 fewer than the 2020 through 2023 average, and it marks the lowest mid-July slaughter since 2008, when depressed cull rates fostered rapid – and ultimately unsustainable – expansion. Heifers are still in short supply. This afternoon, USDA estimated there were 3.5 million dairy heifers on July 1, ste

The dairy markets have lost that summer sizzle. It’s still hot in the Northeast and in states along the West Coast. Milk production is much lower than it was during the spring flush, just as it always is in mid-July. Components have dropped. But in the center of the country, cows are enjoying cool nights and recovering from the sweltering conditions that prevailed a couple weeks ago. Milk yields are bouncing back in the Midwest. Cheesemakers in the region found a few loads of

Trade topics continue to dominate the headlines as the 90-day pause on the ‘Liberation Day’ tariffs came and went this week. While the situation remains fluid, the administration appears to have extended the overall reciprocal tariff pause until August 1, while sending a series of letters to specific countries threatening elevated tariff rates. Many of the countries that received tariff letters are key destinations for U.S. dairy exports, casting further doubt over U.S. dairy

 The heifer shortage and avian influenza reined in U.S. milk output in 2024, fostering lofty milk and dairy product prices in the second half of last year. But after nearly two years of low cull rates and sheer grit, the parlors are full, and so are the milk tanks. In the first 24 weeks of 2025, dairy cow slaughter was 7.7% behind the 2024 pace and 15.6% slower than historic average cull rates. Dairy producers added 122,000 cows over the past 11 months. From coast to coast, b

The invisible hand is solving the heifer shortage. Years of decent profits and the promise of more prosperity on the horizon pushed producers to invest in new barns, forgo some beef calf income in favor of dairy calves, and cull as few cows as possible. Those efforts are adding up. USDA revised its estimate of the April milk cow herd. The agency now shows that dairy p   On the supply side, warm weather is tightening cream supplies as components drop seasonally and ice cream

Strong exports have assuaged concerns about rising U.S. cheese and butterfat output. Even after a significant spring and early-summer rally, U.S. cheese and butter remain the cheapest in the world, putting a firm floor under these dairy commodities. Domestic butter demand is holding strong, but Americans are eating a little less cheese than they did last year.   On the supply side, warm weather is tightening cream supplies as components drop seasonally and ice cream product

U.S. milk and dairy product output is growing quickly. But formidable exports are keeping a firm floor under the dairy markets. Even after sizable spring rallies, American cheese and butter are the cheapest in the world. Exports of those products are strong and likely to remain so. Daily average U.S. cheese exports surged to an all-time high in April, up 6.7% from already-lofty volumes in April 2024. U.S. exporters sent butter abroad at a good clip, but shipments fell well sh

The cheese markets are searching for the ceiling. CME spot Cheddar blocks rallied 7.75ȼ this week to $1.9475 per pound, and they established a fresh seven-month high. Barrels climbed 1.75ȼ to $1.87. Such lofty values were wholly unexpected earlier in the year, when the trade was focused on the impact of new cheese production. But start-up issues have reduced the volume of fresh cheese that meets CME specifications for delivery to Chicago. USDA’s Dairy Market News reports that

For several years the heifer shortage restrained growth in U.S. milk output. But the invisible hand has proved its might once again. Given enough time and economic incentive, industries can turn scarcity into abundance. Dairy producers have managed this feat by culling significantly fewer cows than they did in the past, reducing their need for replacement heifers. In 2023, U.S. dairy producers culled about 35,000 fewer cows than their average in the five previous years. Last

The cheese markets soared. CME spot Cheddar blocks leapt 11.25ȼ to $1.93 per pound, their highest price since January. Barrels followed hot on their tail, climbing 11ȼ to $1.88. The widely anticipated increase in U.S. cheese output is underway, but the ramp up has been slower than expected. Cheese buyers who were waiting for heavy supplies and lower prices to lock in their summer needs are now scrambling to get their hands on some product. USDA’s Dairy Market News notes that

The bulls feasted this week on news of booming U.S. dairy exports and signs that American dairy remains attractive to foreign buyers. Tuesday’s Global Dairy Trade (GDT) auction served as an appetizer. Buyers bid up nearly all products. Compared to the late-April auction, whole milk powder prices climbed 6.2% while Cheddar jumped 12%. Both products notched three-year highs. Not to be outdone, butter rallied 3.8% to its highest-ever price at the GDT. And lactose values leapt 16

Ailing domestic consumption and dimming export prospects have weighed on dairy commodity values, and in turn, milk prices. The April Class III price was announced this week at $17.48/cwt. while Class IV came in at $17.92/cwt., representing the first time since October 2021 that both prices were below $18. Modest relief may be on the way as futures markets currently predict that both Class III and Class IV values will improve slightly later in the year. 

Every week, U.S. dairy producers send about 10,000 fewer milk cows to beef packers than they used to. That’s slowly adding up to more cows in the barn. Even so, dairy cow head counts are not as high as previously thought. After its quarterly survey, USDA trimmed its estimates of January and February milk cow inventories. The agency pegged the herd at...

The cheese markets moved from strength to strength after the early-spring selloff energized exports. U.S. cheese is the cheapest in the world, and shipments to key markets – including Mexico and South Korea – remained formidable through February. USDA’s Dairy Market News reports that, more recently, export orders have been stronger than expected, as Mexican buyers have not been deterred by trade war uncertainty. American exporters are hustling to move cheese abroad, which has

Spring has sprung and the resurgence of allergies isn’t the only sign of the season. Milk volumes are also expanding in most regions as the spring flush moves across the country. Seasonal increases are compounding milk volumes that are growing year over year both in liquid terms and in component values. As a result, milk supplies are plentiful in most parts of the U.S. Demand from bottlers has generally been upbeat, especially as many educational institutions are wrapping up

Tariff drama took center stage again this week as the long-awaited “Liberation Day” arrived. Speaking from the Rose Garden, President...

Dairy producers are doing all they can to keep their barns and milk tanks full, and it shows. In the week ending March 15, they sent just...

The days are getting longer and milk production is climbing. It’s officially spring. The Midwest welcomed in the new season with a few...

The dairy markets are adjusting to the new regime. Trade threats – and new tariffs on U.S. dairy exports to Canada and China – have...

Like a teenager in a bad relationship, U.S. tariffs on goods from Canada and Mexico are on-again, off-again, and then changing their...

Red ink flooded Chicago this week. The dairy markets suffered a deluge of data and news that invigorated the bears. The trade war heated up.

U.S. milk production may have changed its tune. After slipping in the final months of 2024, output appears to have grown in January,

Love is in the air. And while folks across the country may be looking forward to preparing a special date night dinner for their...

It was a truly wild week on LaSalle Street. The dairy markets swung violently back and forth amid the on-again, off-again trade war.

This week may have been light on USDA reports, but there was no shortage of news for the dairy markets to digest. Developing stories...

To the dismay of hamburger consumers across the nation, dairy producers sent just 2.76 million cows to slaughter in 2024. That was...

The cheese markets are searching for direction. In the rearview mirror, booming exports and a steep drop in U.S. cheese stocks argue...

The dairy markets are adjusting to the post-Christmas routine. Traders are back at their desks, and milk bottlers are running full throttle.

As the new year unfurls before us, dairy producers and other industry stakeholders are preparing for the opportunities and challenges...

Bah! Humbug. California dairy producers are likely expressing their frustration with more colorful – but less festive – epithets as the...

Class III futures bounced back bigtime this week, led by another strong performance in the whey market. CME spot whey powder rallied...

The dairy markets had a lot of data to digest along with their turkey. While Americans topped their mashed potatoes and slathered...

Never doubt the power of the profit motive in a free market. In the face of a devastating virus and a systemic heifer...

Soaring temperatures, summer shortages, and sky-high prices are out of season as the cheese and butter markets hunker down for the winter.

The cheese markets took another big step back this week. CME spot Cheddar blocks plummeted 11.75ȼ and closed at $1.72 per pound,...