Producer Pay Forecast: January 5, 2026

The USDA has released new data including the Dairy Products report, the Cold Storage report, and November milk production. As of today, all missing data from the government shutdown has been released. These reports reveal some key market details.

Dairy Products:

• Butter production grew 11.6% in September and 10.1% in October (YoY)
• YTD butter production is now up 6.5%
• Total cheese production grew 3.2% while cheddar grew just 0.7% in October (YoY)
• Nonfat dry milk production was down 1.5% in October (YoY)
• Dry whey production grew 2.1% in October (YoY)

Cold Storage:

• Butter stocks came down just 1.5% in November (YoY)
• Total cheese stocks grew 2.6% in October and 1.8% in November (YoY)

Milk Production:

• U.S milk production grew 4.7% in November (YoY), bringing YTD production to +2.3%
• U.S milking herd grew 2.4% in November (YoY)
• U.S milk per cow grew 2.2% in November (YoY)

The increases did not come as a surprise after a year of robust production, but it has weighed on the CME spot market. Butter and blocks pushed lower following the USDA report releases, and dry whey has lost some of its upward momentum. Although export strength has been supportive for the U.S, we will need to see continued export growth to keep up with production this year.

As always, please feel free to reach out to Allee with any questions.

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