Producer Pay Forecast: July 14, 2026

Dairy markets have ticked up some over the first half of July following commodity-price declines earlier this summer. Despite the recent improvement in CME block and butter prices, along with stabilizing nonfat dry milk prices, the broader outlook remains mixed. Milk supplies continue to grow, but product inventories remain relatively manageable, providing some support to the market.

Key Updates

Milk production & milking herd:

• 24-State milk production grew 2.43% year-over-year in May
• 24-State milking herd grew 2.01% over the same period
• U.S milk per cow increased a modest 0.42% (YOY May)
• NY milk production grew 1.76% (YOY May) despite a 0.22% decline in milk per cow over the same period
• Dairy cow slaughter was down 6.2% (YOY May)

This data indicates that herd expansions and retention remain primary drivers of milk production growth in the U.S.

Dairy products:

• Butter production increased 3.48% (YOY May) and is up 5.5% year-to-date
• Butter stocks were 8.01% lower than prior year in May
• Total cheese production grew 2% (YOY May)
• American-Cheddar production fell 1.2% (YOY May)
• Nonfat dry milk production has increased considerably, growing 10.3% (YOY May)
• NDM stocks remain below prior year levels—down 3.9% in May and 7.9% lower YTD

CME Spot Market

• Blocks strengthened from $1.4300/lb. (July 1) to $1.6050/lb. (July 14)
• Butter has been trading in the mid $1.60's, coming in at $1.6400/lb. (July 14)
• NDM has recovered slightly after a steep decline, landing at $1.5275/lb. (July 14)
• Dry whey remains comparatively steady and rangebound in the upper $0.60's/lb.

Export demand has remained strong, and retail sales have continued supporting product absorption as well. Much of the growth in cheese production is occurring in Italian-style and other specialty cheeses, which may provide support for cheddar and class III values if supplies become tight. The upside does remain limited for U.S prices unless international markets begin seeing an increase as well.

The June 2026 WNY blend price came in at $21.03/cwt.

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