The Latest: October - 2026
Protein Powders Strengthen While Cheese and Butter Bounce Off the Bottom
The gap between U.S. and international milk powder values has widened to a chasm and even buyers in Mexico are starting to look elsewhere. After glancing at prices across the border, Mexican buyers stepped up the volume of their bids at the GDT this week. That’s evidence of a downshift in U.S. trade prospects, which were already in decline.
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The meltdown in the butter market dragged November Class IV down. Pricey cream discouraged churns from running hard in early September, and butter output is down 1.4% from a year ago. Butter makers have stepped up the pace but the market makes clear that butter supplies remain tight
View reportU.S. milk output is now growing at a historically normal rate, but there are many barriers to more rapid expansion, including onerous feed costs and self-imposed supply management restrictions.
View reportDespite challenging weather and margin complications, each of the major dairy states saw volumes rise. Production growth was driven by both stronger yields and a modestly larger herd.
View reportSome of these dynamics were foreshadowed by declines at last week’s Global Dairy Trade auction. Every product lost ground at the auction, though the biggest declines were seen by butter, buttermilk powder, and whole milk powder.
View reportGrocers are still worried about empty shelves and willing to pay whatever it takes to get their hands on more butter. But in just a few weeks they will be done stocking up for the holiday baking season, and prices are expected to plummet.
View reportBarrels eligible for delivery to Chicago are in short supply. Fresh Cheddar may be tight, but there is plenty of cheese in storage. Cheese production may fall short of potential, but output will still be ample.
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