Nearby Class III milk futures have sunk below $17 due to continued ample production of U.S. supplies.
What’s happened
The growing trend of increased milk production started early this year when monthly milk reports began to show gradual increases. In late July, I wrote about the trend in increased production, which was weighing on milk futures prices back then.
That trend continues with the most recent July Milk Production report for the United States, which totaled 19.570 billion pounds. That’s up 3.4% from the same month last year. The theme continues: More cows producing more milk.
The report also showed that total milk cows on farms in the U.S came in at 9.485 million head, up 159,000 head year over year and up 10,000 head from the month prior. And those cows are producing ample amounts of milk as the report showed milk production per cow averaged 2,063 pounds, which was up 34 pounds per cow from July 2024 and up 33 pounds from the month prior.
From a marketing perspective
Production is huge and, thankfully, demand for the most part is staying firm, which helps keep the milk futures price from totally crashing lower.
The most recent U.S. dairy export report showed total U.S. dairy exports in July 2025 at 248,607 metric tons. That’s up 10% from July 2024. Yet, compared to June 2025, the number was down 3%.
Leading the export over achiever category: cheese and butter.
- Cheese exports came in at 52,105 metric tons, up 29% from last year.
- Butter exports were astounding at 12,235 metric tons, said to be the highest since the mid-1990s.
Prepare yourself
Traders will be eager to see levels of milk production on the next monthly report, which is due out Sept. 22. Will U.S. milk production numbers still continue to grow, which could weigh on Class III futures prices? Or might we see a shift in sentiment, allowing the market to find price support?
Reach Naomi Blohm at 800-334-9779, on X: @naomiblohm, and at naomi@totalfarmmarketing.com.
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