The Latest: November - 2025
Markets Swinging Wildly Because of Politics and Anxiety
The commodity markets swung wildly back and forth this week, buffeted this way and that by politics and anxiety. While the U.S. economy continues to expand, growth is uneven. Lower-income consumers are struggling, and many middle-class Americans are watching their budgets more closely. They’re dining out less and seeking bargains when they do. Many shoppers are trading down to store brands or switching to discount retailers. This week, the Trump administration and a federal judge sparred over the timing and amount of Supplemental Nutrition Assistance Program (SNAP) benefits the government will fund during the partial shutdown, leaving the 43 million Americans who receive SNAP benefits in limbo.
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It was a rough week on LaSalle Street. The trade had hoped that lower milk output and a smaller dairy herd would propel the markets upward. And they did, for a time.
View reportThe U.S. dairy industry continues to shrink. In the latest Milk Production report, USDA trimmed its estimates of 2023 milk production, and it cut its assessment of the milk cow herd for every month last year. According to the latest figures, the milk-cow herd contracted nearly 50,000 head in 2023 and declined another 23,000 head from December to January.
View reportUSDA released its 2022 Census of Agriculture earlier this week, providing the latest installment of the once-every-five-year report on the state of agriculture in the country. Unsurprisingly the report showed that farm numbers have fallen while expenses have risen, and the average American farmer has aged. But the report provided some encouraging information, as well. Total farm income rose by 39.8% compared to five years ago, while average farm income increased by 50.2%.
View reportAfter a period of exuberance, the dairy markets ran into some resistance this week. Though milk supplies are far from plentiful, demand for spot milk has stabilized and combined with a lackluster demand picture, there has been little incentive over the last few days to push the markets further upward.
View reportWith the benefit of hindsight, USDA now believes there were many fewer dairy heifers on hand at the beginning of 2023 than previously thought. In its biannual Cattle inventory report, the agency slashed its estimate of the dairy heifer headcount on January 1, 2023 by 263,600 head.
View reportMilk production growth in the U.S. sputtered at the end of 2023, leaving the full year result nearly unchanged from the year prior. After expanding during the first half of the year, volumes contracted between July and December as milk prices remained under pressure.
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