US Dairy Industry Sees Record Milk Output and Herd Expansion

The number of cows increased to 9.581 million, up by 40,000 from August and 228,000 compared to the previous year. The average output per cow was 1,982 pounds, marking an annual increase of 30 pounds. California, Wisconsin, and Idaho were major contributors to this growth, with Idaho experiencing a 9.1% rise in milk production.

Cheese prices in the US have faced pressure, with CME block Cheddar dropping to $1.54 per pound in mid-November, the lowest since April 2024. This decline is attributed to export challenges and competition from declining European butter and cheese prices.

Butter markets, on the other hand, have shown stronger performance. CME butter prices increased to $1.5750 per pound, with strong retail demand influencing this rise. Export demand for US butter also remains robust due to competitive pricing against European supplies, despite the tightening of domestic butter availability.

The USDA released delayed data following a federal shutdown, raising milk production forecasts for 2025 and 2026 due to higher cow inventories and productivity. European Union milk collections also surged in September, reflecting recovery from previous impacts.