June Sees Rising Milk Production, 19,000 More Cows
Published: Friday, July 31, 2026
It was a hot smoky week, particularly in the Great Lakes, Upper Midwest, New York, Washington, D.C., and parts east, as well as the other Washington out west, courtesy of wildfires, mostly in Canada.
Rising dairy cow numbers, meanwhile, kept milk output above a year ago. The USDA's latest data has June Dairy Month output at 19.7 billion pounds, up 2.3% from June 2025, which follows a 2.1% rise in May. The 24-state total came in at 18.9 billion pounds, up 2.4% from a year ago.
StoneX points out that fat and protein in the milk was also up from last year, which pushed component adjusted production up 3.7% from last year. "The majority of the heat waves seen in the U.S. this summer happened in July, so we likely won't see the effects of that until the next production report. That began to underpin cheese markets along with stronger EU prices due to a heat wave there as well in July. Nonetheless, temperatures have cooled moving into the end of July which should help milk production recover a bit short term."
May milk output in the 50 states was revised down 36 million pounds to 20.5 billion, still up 2.1% from a year ago, instead of the 2.3% originally announced. The 24-state total was revised down 43 million pounds, to 19.7 billion, up 2.4%.
June cow numbers totaled 9.677 million, up 19,000 from the May count, which was revised down 7,000 head, but was up 192,000, or 2%, from a year ago, and a 33-year high, according to the Daily Dairy Report. The 24-state count, at 9.231 million head, was up 18,000 from May's total which was revised down 12,000 head, but was up 185,000, or 2%, from a year ago.
June milk per cow averaged 2,036 pounds in the 50 states, up 6 pounds, or .3%, from a year ago. The 24-state average, at 2,051 pounds, was up 7 pounds, or .3%, from 2025. The May average was revised down 2 pounds in both.
California milk totaled 3.4 billion pounds, up just 8 million, or .2%, from a year ago. Cow numbers were up 4,000 while output per cow was unchanged. Wisconsin produced 2.7 billion pounds, up 42 million, or 1.6%, from a year ago. Cow numbers were up 20,000 with output per cow unchanged.
Idaho milk was up 34 million pounds, or 2.2%, from a year ago, thanks to 14,000 more cows. Output per cow was up 5 pounds. Indiana was up 3.9% on 7,000 more cows and a 5-pound gain per cow. Michigan was up 3.6% on 14,000 more cows and a 10-pound gain per cow.
The USDA's weekly data shows 45,100 head of dairy cattle were sent to slaughter the week ending July 4, up 4,900, or 12.2%, from a year ago. Total to date, 1,398,300 head have retired from the dairy industry, up 70,200 head, or 5.3%, from a year ago.
The August federal order Class I base milk price is $18.76 per hundredweight, down $2.57 from July, and 17 cents below a year ago. It equates to $1.61 per gallon, down from $1.63 a year ago. The eight-month Class I average stands at $18.45, down from $19.45 a year ago, and compares to $19.43 in 2024.
The Daily Dairy Report's Monica Ganley Quarterra wrote in the July 17 Milk Producer Council newsletter, "U.S. consumers felt a bit of relief in June as prices eased somewhat. The Consumer Price Index, published by the Bureau of Labor Statistics (BLS) eased to 3.5% during the month, down .7 percentage points from May due especially to softer energy prices. Lower gasoline prices were also the key driver that boosted the Consumer Sentiment Index (CSI), which rose to 54.4 points in the preliminary July reading published by the University of Michigan. The CSI now sits at its highest reading since February, before the conflict in Iran began. While lower inflation and stronger consumer sentiment are undeniably favorable, the outlook remains fraught as the recent breakdown in the ceasefire between the U.S. and Iran has raised gasoline prices anew."
She adds that "Food price inflation also slowed in June though menu price increases continue to outpace those of grocery stores. BLS data showed that the price of food consumed outside the home was up 3.4% versus the same month last year. However, this marks the lowest year over year gain since 2020 when pandemic related complications drove restaurant prices dramatically upward. Reports from the National Restaurant Assn. indicate that conditions improved slightly in May, but that falling foot traffic remained a challenge. Meanwhile, the price of food consumed at home rose 2.7% compared to June 2025, similar performance to what has been recorded the last few months."
China's dairy appetite remains strong. The latest data showed cheese imports in June were up 43.4% from June 2025, with most coming from New Zealand and Australia. However, U.S. cheese saw a significant boost. Year to date cheese imports were up 24.8%. Butter imports were up 6.4% and up 11.3% YTD.
Combined whole milk and skim milk powder imports were up 15.1%, with whole milk powder up 26.9%, third-largest June on record, according to HighGround Dairy. HighGround says New Zealand accounted for 94% of the month's total.
Whey product imports were up 33.6% from a year ago, and that despite China's aggressive move to reduce the nation's hog population, says HGD. Whey imports from the U.S. were up 145%.
Checking CME prices, after closing last Friday at $1.6275 per pound, the Cheddar blocks were trading last Thursday morning at $1.67, highest since April 7, and 3 cents above a year ago, as traders anticipated the June Cold Storage report last Friday afternoon. The barrels were at $1.63 last Thursday, highest since Nov. 14, 2025, and a half-cent above a year ago, after closing last Friday at $1.6125.
High summer temperatures in the Central region continue to negatively impact milk output, according to Dairy Market News. Spot prices for Class III milk ranged from flat-class to $5-over at mid-week. Some cheesemakers got offers of milk last week from plants with down time but those offers dried up this week. Cheese output was steady to lighter, as some plants didn't have the milk for full schedules. Domestic demand for cheese is starting to pick up. Export interest is steady. Inventories of cheese barrels is expected to tighten in the coming weeks.
Milk output continues to fill cheese manufacturing in the West. In a few parts, some unforeseen plant downtime kept spot milk loads more available than anticipated. Domestic cheese demand is steady, while export demand varies from steady to stronger.
Butter sunk to $1.5075 per pound last Friday, down 8.25 cents on the week, lowest CME price in four weeks, and 95.75 cents below a year ago. Seventy-seven loads were sold on the week, 40 on Friday.
Central region cream production was lighter last week. Downtime at production plants was having a negative impact. Most spot cream is going to Class II processors and some butter makers were searching for it to keep churns active. Butter production was steady and demand was unchanged in domestic markets, but export interest is strong. Inventories are not excessive, according to DMN.
Cream production in the West was fulfilling manufacturer needs, although cream multiples were increasing.
Butter production was busy and many butter makers said cream volumes continue to push anticipated downtime back. Demand from domestic and international buyers is steady, says DMN.
Grade A nonfat dry milk dropped to $1.40 per pound last Thursday, lowest since Jan. 28, but still 11.25 cents above a year ago. It closed last Friday at $1.47.
Dry whey was trading last Thursday at 69 cents per pound, 15 cents above a year ago, following a Friday finish at 69.50 cents per pound.
The USDA's May Dairy Supply and Utilization report showed cheese utilization rose for the 17th month in a row, hitting 1.3 billion pounds, up 2.2% from May 2025. Domestic use, at 1.17 billion pounds, was up .7%, while exports hit 135.3 million, up 18.4%.
HighGround Dairy points out, however: "Domestically, natural American cheese fell to its lowest level for the month since May 2022, as weak foodservice sales dampened stateside consumption."
Butter use totaled 215.5 million pounds, up 10.6%, with domestic usage up 5.6% and exports up 88.8%. HighGround says year to date butter utilization through May surpassed the 1 billion pound mark, the earliest that has ever happened.
Nonfat-skim milk powder utilization came in at 204.3 million pounds, down 8.5%, as exports plunged 20.1% due to high U.S. prices. Domestic usage was up 9.7% and HGD says that elevated domestic demand may help keep U.S. prices from falling back to the $1.20 per pound level seen at the start of the year.
Dry whey disappearance totaled 80.5 million pounds, up 14.5% from a year ago. Domestic use was down a whopping 52.2%. However, exports soared 112.3%. HighGround said, "U.S. prices have been discounted relative to Europe, which may be one reason for the strong shipments."
In politics, President Trump announced new 50% tariffs on most Canadian goods entering the U.S., mockingly citing incoming smoke. The increased tariffs come as talks continue to renew the U.S.-Mexico-Canada (USMCA) free trade agreement, which Trump opposes.
The National Milk Producers Federation and U.S. Dairy Export Council expressed support for administration efforts to "identify all possible avenues to drive Canada to make the necessary changes to its protectionist dairy trade practices."
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