Benchmark jumps 66 cents
The Agriculture Department announced the April Federal order Class III milk price at $16.82 per hundredweight, up 66 cents from March, 66 cents below March 2025, and the highest Class III price since Nov. 2025. That brought the four month average to $15.63, down from $19.16 a year ago, and compares to $15.77 in 2024.
Late Friday, May 1, morning Class III futures portended a May price at $17.10; June, $17.36; July, $18.02; August, $18.48; September, $18.74; with a peak in October at $18.80.
The April Class IV price is $20.22, up $1.28 from March, $2.30 above a year ago, and the highest Class IV price since January 2025. Its four month average stands at $17.25, down from $19.19 a year ago, and compares to $19.86 in 2024.
Increased cow numbers and more milk per cow nudged March milk production higher for the 13th month in a row. USDA’s preliminary data showed March output at 20.391 billion pounds, up 2.3% from March 2025, and followed a 2.9% gain in February. The 24 State March total hit 19.591 billion, up 2.4%.
February output was revised up 7 million pounds to 18.262 billion, still 2.9% above a year ago. The 24 State total was revised down 13 million pounds, to 17.546 billion, up 3.0% instead of the 3.1% originally reported.
Cow numbers totaled 9.621 million head, up 8,000 from the February count, which was revised down 2,000 head, but was up 187,000 or 2.0% from a year ago. The 24 State count, at 9.183 million, was up 8,000 from February’s total, which was revised down 8,000 head, and 188,000 or 2.1% above a year ago.
March output per cow averaged 2,119 pounds in the 50 States, up 7 pounds or 0.3% from a year ago. The 24 state average, at 2,133 pounds, was also up 7 pounds or 0.3% from 2025. The February average was revised up 1 pound in the 50 States and was unchanged in the 24 States.
StoneX said “Milk production per cow was weaker than expected with growth slowing from 2.4% back in November (lapping over bird flu impacts) to just up 0.3% in March, marking the fourth month of decline. Fat and protein in the milk were up from last year and from last month, however fat content is still below trend. All together this puts component adjusted milk production up 3.3%.
California producers put just under 3.6 billion pounds of milk in the tank, up 28 million or 0.8% from a year ago, following a 2.2% gain in February. Cow numbers were down 3,000 head while output per cow was up 20 pounds from a year ago.
Wisconsin milk totaled 2.85 billion pounds, up 72 million or 2.6%, which followed a 3.3% gain in February. Cow numbers were up 27,000 with a 10 pound gain.
Idaho was up 51 million pounds or 3.4% on 24,000 more cows. Output per cow unchanged.
Kansas had the biggest percentage gain, up 100 million pounds or 25.4% from a year ago, on 47,000 more cows and a 5 pound gain per cow. Michigan was up 3.6% and Minnesota was up 2.4%,
New Mexico, one of four states showing a decline in milk output, was down 3.2%, due to 9,000 fewer cows milked. Output per cow was up 10 pounds however.
New York was up 2.1%, Ohio was up 1.2%, and Oregon was up 6.2% on 7,000 more cows and a 5 pound gain per cow.
Pennsylvania was down 2.3%, South Dakota was up 6.9%, and Texas produced 1.6 billion pounds, up 74 million or 4.7% from a year ago, thanks to 31,000 more cows and a 5 pound gain per cow. Washington State was down 5.8%, on 15,000 fewer cows, though output per cow was up 5 pounds.
Chinese dairy imports were higher in March. China Customs Statistics showed cheese imports totaled 51.8 million pounds, up 40.6% from March 2025, an all-time high on a 30-day adjusted basis, according to HighGround Dairy’s analysis, and “Surpassed 22,000 metric tons in a single month for the first time ever.” New Zealand benefited the most, according to HighGround, with sales up 40% from a year ago. Year to date China’s overall cheese imports are up 33.9%.
Butter imports, at 32.1 million pounds, were up 38.8% from a year ago, and up 4.4% year to date, and primarily came from New Zealand, said HGD.
Chinese whole milk powder imports soared to 127.8 million pounds, up 34.1% from a year ago, highest volume on a 30-day adjusted basis since Jan. 2025, said HGD. Imports YTD however are down 8.5%. Skim milk powder imports totaled 43.2 million pounds, down 23.8% from a year ago.
Whey product imports fell to 112.1 million pounds, down 25% from a year ago and down 13.1% YTD. HighGround blamed China’s aggressive push to downsize its hog population. The government is attempting to support pork prices and that effort has impacted U.S. sales. China’s U.S. purchases were down 6.0% from 2025.
HighGround also reported that China’s Ministry of Agriculture and Rural Affairs confirmed the country’s first-ever outbreak of foot and mouth disease in April.
An increase in the All Milk Price was tempered by increased feed prices however the March feed price ratio moved higher for a second month. The USDA’s latest Ag Prices report had March at 2.25, up from 2.17 in February, but compares to 2.45 in March 2025.
The All Milk Price was $19.70 per hundredweight (cwt.), with a 4.39% butterfat test, up $1.40 from February’s $18.30 on a 4.46% test. That compares to $22 per cwt. a year ago which had a 4.36% test.
The national corn price averaged $4.27 per bushel, up 16 cents from February but was still 30 cents below March 2025. Soybeans averaged $11.10 per bushel, up 50 cents from February, and 90 cents per bushel above a year ago. Alfalfa hay averaged $166 per ton, up $7 from February, but $2 below a year ago.
The March cull price for beef and dairy combined averaged $164 per cwt., up $2 from February, $24 above March 2025, and $92.40 above the 2011 base.
Quarterly milk cow replacements averaged $3,130 per head in April, up $150 from January, and $270 above April 2025. Cows averaged $3,000 per head in California, up $200 from January, and $300 above a year ago. Wisconsin’s average, at $3,320 per head, was up $150 from January, and $190 above April 2025.
Milk production margins increased for the second straight month by gaining $1.05 per cwt. and was above $10 per cwt. for the first time in 2026 at $10.93. That’s according to dairy economist Bill Brooks, of Stoneheart Consulting in Dearborn, Mo. “Income over feed costs in March were above the $8 per cwt. level needed for steady to higher milk production for the 29th month in a row,” said Brooks. “Input prices were higher in March with one of the three input commodities inside of the top 10 for March all-time. Feed costs were the sixth highest ever for the month of March and increased 35 cents per cwt. from February. The March All-Milk price was inside the top 10 for the month, at the 7th highest ever recorded for the month.”
Milk income over feed costs for 2026 (using April 30 CME settling futures prices for Class III milk, corn, and soybeans plus the Stoneheart forecast for alfalfa hay) are expected to be $11.91 per cwt., a loss of 53 cents per cwt. versus 2025. Income over feed costs would be above the level needed to maintain or grow milk production and up 42 cents versus the previous estimate, Brooks said.
U.S. fluid milk sales were down again but the slippage was not as great as the month before. The USDA’s latest data showed packaged sales at 3.360 billion pounds, off 0.4% from Feb. 2025, and followed a 2.3% drop in January.
Conventional product sales totaled 3.1 billion pounds, down 0.5% from a year ago. Organic sales, at 242 million, were up 0.4% from a year ago, and represented a typical 7.2% of total milk sales in the month.
Whole milk sales totaled 1.2 billion pounds, up 2.9% from a year ago, and up 2.2% for the two month period. Whole milk represented a typical 36.7% of total sales for the month. Skim milk sales, at 128 million pounds, were down 10.3% from a year ago and year to date.
Packaged fluid sales in the two month period totaled 7.1 billion pounds, down 1.4% from 2025. Conventional product sales totaled 6.6 billion, down 1.3% from a year ago. Organic products, at 503 billion pounds, were down 2.7%, but represented 7.1% of total milk sales for the year so far.
In politics, the House passed its farm bill, 224 to 200. The National Milk Producers Federation said the bill “Supports the farm safety net, preserves existing conservation programs that include opportunities for dairy and livestock producers, and bolsters trade promotion programs.”
The bill also protects common food names, recognizes the important role of dairy in nutrition, and supports animal health programs, all important priorities to dairy farmers and the broader industry,” according to NMPF. The federation said it looked forward to the Senate taking up the bill, adding “At a time where farmers face unprecedented challenges, Congress needs to provide the stability of a five-year, comprehensive farm bill.”
The Wisconsin-based American Dairy Coalition quoted Ag Committee Chairman Glenn Thompson who stated “After 163 listening sessions across 43 states and one U.S. territory, this farm bill was not written in Washington. It was written in barnyards and pastures and machine sheds across America.”
Michael Dykes, president and CEO of the International Dairy Foods Association, echoed that praise, stating “House passage of the 2026 farm bill is a significant achievement that builds momentum towards enacting a new, much-needed five-year farm bill.”
CME block Cheddar closed Friday, May 1, at $1.64 per pound, down a half-cent on the week, a quarter-cent above its April 1 print, and 12 cents below a year ago. The barrels finished at $1.6150, unchanged on the week, 2.25 cents above where they were on April 1, and 14 cents below a year ago.
Sales for the week totaled 11 loads of block and 90 for the month of April, up from 75 in March. There were no sales of barrel on the week and only one for the month of April, down from three in March.
Milk production is steady in the Central region, reports Dairy Market News, and is above a year ago. Spot trades were light last week. Some cheesemakers received fewer offers while others said volumes were available but they were using milk from within their network and not purchasing additional loads. Mid-week spot prices ranged $3 – under to flat. Cheesemakers were running busy schedules. Demand for cheese barrels is strong and block demand was steady to stronger. Retail purchasers are steadily securing cheese, but contacts say food service demand is lackluster. Export demand is also strong.
Milk and cream output in the West are accommodating cheesemakers, however, spot milk availability varied throughout the region. Demand from cheesemakers is moderate. Cheese production was steady and continued active seven days a week. Cream cheese production also remains very active. Retail cheese demand is stable. Manufacturers note demand from food producers incorporating cheese as part of their product is a bright spot so far this year. Industry sources describe export demand as strong, according to DMN.
Cash butter fell to $1.5950 per pound Friday, May 1, lowest CME price since Feb. 3, and 11 cents lower on the week, 15.75 cents below its April 1 level, and 73.50 cents below a year ago. Sales totaled 92 loads for the week and 341 in April, down from 377 in March.
Cream output is strong in the Central region and Class II and Class III processors are buying significant volumes, said DMN, and keeping spot cream volumes balanced to somewhat snug. Spot cream demand is light from butter makers. Butter makers were running busy schedules. Domestic demand for butter is steady week to week, but some stakeholders report lighter food service demand than expected this time of year. Export butter demand is unchanged, DMN said.
Looking westward; Class II dairy product manufacturing is strong as milk and cream production are providing sufficient volumes for butter makers in the region. Demand for spot loads is moderate from butter makers, with seasonally higher second quarter prices for cream. Butter production varies from steady to strong. Domestic demand is steady. U.S. butter prices continue to be an attraction for international buyers, despite some logistical challenges, according to DMN.
You’d almost think nonfat dry milk was coming out of the Strait of Hormuz. Grade A nonfat dry milk soared to a record high $2.2650 per pound Tuesday, April 28, but saw its first retreat Wednesday in 16 sessions, inching back 0.75 cents, and fell to $2.25 Thursday, but closed Friday at $2.2625, up a quarter-cent on the week and $1.0675 above a year ago. There were 19 CME sales on the week and 48 for the month of April, down from 147 in March.
Dry whey saw its Friday finish at 69.75 cents per pound, unchanged on the week, a penny higher than April 1, and 17.75 cents above a year ago. There were three sales on the week and 10 for the month, up from seven in March.
Last but not least, chocolate has reclaimed its place as America’s favorite ice cream flavor, according to the International Dairy Foods Association’s biannual National Ice Cream & Frozen Novelty Trends Survey. Vanilla took the top spot in 2024, said the IDFA, but this year’s results showed chocolate is back at No. 1, with butter pecan also rising ahead of vanilla among U.S. consumers.
