Producer Pay Forecast: September 9, 2025

August values reflect the first full month of pricing under the realigned FMMO and WNY State Order rules.

Prices have remained under pressure over the last few weeks. Despite July butter exports hitting an 11-year high (+206% YoY) and July butter production climbing 9.8% YoY, CME spot butter has held close to $2.00/lb. over the last week. While export strength remains, butter production came down 4.4% MoM from June, indicating churns have eased slightly even as cream supplies remain heavy.

July cheese production increased with cheddar production up 6.7% YoY, and American style cheese production up 2.3% YoY. Cheese exports, while still experiencing an exceptional 29% YoY growth, pulled back MoM. This may have led to the increased pressure on CME spot blocks as they fell to $1.69/lb. on 9/5. U.S prices may need to come down to remain competitive globally and sustain export growth. As domestic demand remains low, export strength is needed to discourage prices from breaking lower.

Overall supply growth is strong, and exports are providing critical support. Butter prices are looking for stability with reduced production, strong exports, and the seasonal demand period ahead. These dynamics will continue to shape component values this fall.

Please be encouraged to reach out to Allee with any questions, concerns, or discussion!

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