The Latest: June - 2025
Milk Flows Again as Herds Grow
The heifer shortage and avian influenza reined in U.S. milk output in 2024, fostering lofty milk and dairy product prices in the second half of last year. But after nearly two years of low cull rates and sheer grit, the parlors are full, and so are the milk tanks. In the first 24 weeks of 2025, dairy cow slaughter was 7.7% behind the 2024 pace and 15.6% slower than historic average cull rates. Dairy producers added 122,000 cows over the past 11 months. From coast to coast, but especially in the center of the country, producers are looking to expand their facilities and add significantly more cows over the next 18 months.
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Judgment is further clouded by stupefying volatility and a sense of déjà vu. Sky-high cheese prices are simply difficult to sustain.
View reportThe bulls are still bruised after getting walloped in mid-September, when spot cheese staged an invigorating climb followed by a dramatic collapse.
View reportThe fundamentals of the milk powder market seem particularly healthy, and the bulls are roaming free.
View reportAfter much volatility, the boundaries are becoming clearer. The spread between blocks and barrels narrowed, adding another layer of uncertainty to the already complex cheese markets.
View reportAfter rocketing higher last week, CME spot Cheddar blocks continued to soar. But, the cheese markets are likely to remain volatile.
View reportThough the bulls made headway, their progress was laborious. Each week they argued that tighter milk supplies and falling cheese inventories should lift prices. Now, the bulls are clearly in charge.
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