Feed Costs Spike as U.S. Dairy Industry Faces Economic Shifts
Source: dairynews.today
April's milk prices dropped to the lowest since 2024, despite high feed costs and evolving market pressures.
The U.S. dairy sector is navigating significant challenges as feed costs have reached their ninth highest for March. The USDA reported April's Class III milk price at $17.48 per cwt., a decline from March yet higher than April 2024. May futures signal a possible rise to $18.50. Despite a higher four-month average of $19.16, the sector remains under stress due to fluctuating input costs.
Class IV milk now stands at $17.92 per cwt., declining compared to both March and last year, marking a low since October 2021. Analysts like Bill Brooks from Stoneheart Consulting note a reduction in milk production margins due to rising feed costs, threatening income levels required for maintaining production efficiency. Commodity prices show notable variations: corn averages $4.57 per bushel, soybeans steady at $10.20, and alfalfa hay at $167 per ton. This pricing landscape complicates feed affordability. Meanwhile, cull cow prices have risen to $140 per cwt. Globally, U.S. agrarian exports to Mexico surged 65% over four years, driven by Mexico’s economic boom, which has expanded consumer dietary diversity.
This growth positions Mexico near to surpass Canada as the U.S.'s top agricultural export market. In industry conversations, challenges like export tariffs, particularly with China, remain.Yet, discussions at the American Dairy Products Institute conference point to export opportunities, suggesting U.S. dairy products could remain competitively priced abroad. Cheese production trends highlight regional variances with Wisconsin leading in total output, while the decline in American cheese reflects broader challenges. Butter production increased by 5.9%, with California at the forefront. The Consortium for Common Food Names has criticized the EU's geographic indications policy, which may restrict market access for U.S. dairy products, an issue highlighted in the USTR's 2025 Special 301 Report.
Class IV milk now stands at $17.92 per cwt., declining compared to both March and last year, marking a low since October 2021. Analysts like Bill Brooks from Stoneheart Consulting note a reduction in milk production margins due to rising feed costs, threatening income levels required for maintaining production efficiency. Commodity prices show notable variations: corn averages $4.57 per bushel, soybeans steady at $10.20, and alfalfa hay at $167 per ton. This pricing landscape complicates feed affordability. Meanwhile, cull cow prices have risen to $140 per cwt. Globally, U.S. agrarian exports to Mexico surged 65% over four years, driven by Mexico’s economic boom, which has expanded consumer dietary diversity.
This growth positions Mexico near to surpass Canada as the U.S.'s top agricultural export market. In industry conversations, challenges like export tariffs, particularly with China, remain.Yet, discussions at the American Dairy Products Institute conference point to export opportunities, suggesting U.S. dairy products could remain competitively priced abroad. Cheese production trends highlight regional variances with Wisconsin leading in total output, while the decline in American cheese reflects broader challenges. Butter production increased by 5.9%, with California at the forefront. The Consortium for Common Food Names has criticized the EU's geographic indications policy, which may restrict market access for U.S. dairy products, an issue highlighted in the USTR's 2025 Special 301 Report.
