USDA Raises 2025 Milk Production Forecast Amid Lower Dairy Prices

By
Tanya Eadie
-
1208

The USDA’s Livestock, Dairy, and Poultry Outlook: April 2025 report projects higher milk production this year, even as dairy product prices continue to decline.

Key Highlights:

  • Milk Production: The 2025 forecast has been raised to 226.9 billion pounds, up 0.7 billion from last month, driven by 25,000 more cows and higher yields per cow (+10 pounds).

  • Dairy Cow Numbers: The U.S. dairy herd is expected to average 9.405 million head, the result of strong retention and fewer culls early in the year.

  • Milk Prices:

    • All-milk price forecast lowered to $21.10/cwt, down $0.50 from March.

    • Class III price now projected at $17.60/cwt (-$0.35).

    • Class IV forecast at $18.20/cwt (-$0.60).

  • Dairy Product Prices (per pound):

    • Cheddar Cheese: $1.790 (-2.0 cents)

    • Butter: $2.445 (-7.0 cents)

    • Nonfat Dry Milk (NDM): $1.22 (-3.5 cents)

    • Dry Whey: $0.510 (-1.5 cents)

  • Wholesale Price Trends: Most product prices fell between early March and early April. Cheddar blocks saw the sharpest drop (-23.22 cents), while butter was the only product to rise slightly (+1.08 cents).

  • International Comparison: U.S. dairy remains competitively priced. Butter and cheese exports continue to perform well, despite lower international demand for NDM and whey.

  • Supply Trends:

    • February milk production hit 17.725 billion pounds, up 1% year-over-year (adjusted for the leap year).

    • Cow productivity also increased, although California saw a decline likely due to earlier HPAI disruptions.

  • Dairy Exports & Imports:

    • Exports (milk-fat basis): Up to 11.8 billion pounds (+0.1 billion).

    • Exports (skim-solids basis): Lowered to 44.6 billion pounds (-2.9 billion), due to weakened demand in Southeast Asia.

    • Imports were reduced, especially for cheese and butter, in part due to added tariffs.

  • Domestic Use & Stocks:

    • Domestic dairy use remains steady on a milk-fat basis, but skim-solids use was raised to 187.3 billion pounds.

    • Ending stocks for both fat and skim solids are expected to rise slightly in 2025.

📄 Full Report: USDA Livestock, Dairy, and Poultry Outlook: April 2025 (PDF)

📊 Dairy Forecasts Spreadsheet: Download XLSX

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