US milk production continues to grow strongly in November

US dairy farmers in the 24 largest states collectively delivered 8,27 million tons of milk to their processors last month. This represents a 4,7% increase compared to the same month in 2024. Moreover, the lead is widening, as growth of 3,8% was recorded in October.

States making significant contributions to growth are California (+10,4%), Texas (+4,9%), and Michigan (+4,6%). Of the major dairy states, only Wisconsin (+1,8%) is experiencing slightly slower growth than the national average. The rising supply figures are a result of higher animal numbers, which are generally more productive. The number of dairy cows in November was 9,13 million, over 200.000 head higher than a year earlier.

Milk price under pressure
The high supply is putting pressure on milk prices, although the decline this fall is less severe than in the spring. The price of class 3 milk, intended for cheese production, even rose slightly in November to $17,18 per cwt, which translates to a whopping €33 per 100 kilos of milk. Not a record high, but also not a rock bottom price by US standards. Due to the weak dollar, the price converted into euros gives a somewhat distorted picture.

Butter is cheaper than cheddar again
The increase in milk production is noticeable in the US dairy market. According to Stephen Cain, president of the National Dairy Farmers Federation, there's "a lot of milk" available for processors. This is leading to higher inventories, partly due to lower consumer demand. Butter prices, in particular, are under pressure, although other processed goods are also trending downward. In mid-December, butter, at $3.353 per ton, was cheaper than cheddar for the first time since the summer of 2021.

Lower dairy prices are gradually filtering through to store shelves. This is good news for President Donald Trump, who has made combating food inflation a key policy priority.