US Dairy Farmers Produce More Milk with Fewer Cows
The US dairy herd stood at about 9.575m animals at the end of 2025 and is expected to fall to roughly 9.555m in 2026. Despite the smaller herd, annual milk production is projected to rise from 231.4bn lb to 234.1bn lb. Higher yields per cow have been associated with advances in genetics, animal nutrition and herd management.
Cheese remains a central source of demand. The category represents about a quarter of the total value of the dairy-products market, while per-person cheese consumption reached a record 41.8lb, or about 19kg, in 2024. Pizza continues to support demand in food service, and retail sales have been helped by the growth of snack-sized cheeses marketed to consumers seeking portable, protein-rich foods.
Mozzarella, cheddar and Hispanic-style cheeses account for much of the volume. The pattern reflects established eating habits as well as demographic changes. At the farm level, however, the increase in output has not translated into a comparable rise in returns. Feed costs have declined, but lower milk prices have taken back much of that improvement.
Milk producers have limited ability to adjust output quickly in response to price movements. Most continue milking during periods of weaker prices. Highly pathogenic avian influenza in dairy herds remains a regulatory and commercial concern, although the focus has shifted from possible direct production losses towards the response of regulators and trading partners if further outbreaks occur.
Exports provide an outlet for the additional supply. US dairy exports in 2026 are projected at about 17.5bn lb, equivalent to 7.94m tonnes. Shipments of non-fat solids are expected to remain broadly stable, while a larger share of domestic production is being directed towards protein-focused products for American consumers. This gives processors greater flexibility in deciding how to use and distribute milk solids.
Estimates of the US dairy market differ according to the definition used, ranging from about $115bn to more than $250bn. Primary milk production is estimated at $52bn in 2026, while dairy manufacturing—including the conversion of raw milk into cheese, butter and other products—is valued at $153bn. MarketsandMarkets has projected that the broader market will reach $343.7bn by 2034. Danone, Lactalis, Nestlé and Kraft Heinz are among the large companies monitoring developments in US dairy production and consumption.
