In the news affecting a dairy producer's bottom line as we begin July 2025:
- Senate includes dairy provisions in budget reconciliation bill
- USDA announces phased reopening of southern ports for livestock trade
- Farmer sentiment weakens on cloudy trade outlook
- GDT index down again
- July FSA interest rates slightly higher
- Lactalis USA completes acquisition of General Mills’ U.S. yogurt business
- Corn-planted acreage up, soybean acreage down
Senate includes dairy provisions in budget reconciliation bill
The National Milk Producers Federation (NMPF) commended the U.S. Senate for the dairy and agriculture provisions they included in their version of the One Big Beautiful Bill Act.
“Dairy farmers are grateful for legislation that will create several key opportunities for dairy,” said Gregg Doud, NMPF president and CEO in a statement. “Following last month’s successful vote in the House, we are excited that the Senate’s legislation also positions these investments to benefit dairy farmers and the cooperatives they own. We hope they are enacted into law as swiftly as possible.”
Congress is attempting to pass the measure prior to the July 4 Congressional recess.
The Senate Agriculture Committee’s portion of the bill includes numerous NMPF-backed requests that would strengthen dairy and farm policy, including:
- Renewing the Dairy Margin Coverage (DMC) program through 2031; updating DMC’s production history calculation to be based on the highest production year of 2021, 2022 or 2023; and extending the ability for producers to receive a 25% premium discount for locking in their coverage for the duration of the bill
- Providing mandatory funding for USDA to conduct mandatory dairy processing cost surveys every two years to provide better data to inform future make allowance conversations
- Folding remaining Inflation Reduction Act conservation dollars into the farm bill baseline, resulting in increased long-term funding for popular, oversubscribed programs like the Environmental Quality Incentives Program
- Providing new trade promotion funding based on current programs that return well over $20 in export revenue for every dollar invested in the programs
- Increasing funding for animal health programs that help to prevent, control and eradicate animal diseases, such as the outbreak of H5N1 in dairy cattle
The Senate Finance Committee’s portion of the bill, released on June 16, makes permanent the Section 199A tax deduction, enabling dairy farmer-owned cooperatives to continue either passing the deduction back to their farmer owners or reinvesting it in their cooperatives.
USDA announces phased reopening of southern ports for livestock trade
U.S. Secretary of Agriculture Brooke L. Rollins announced risk-based port reopenings for cattle, bison and equines from Mexico beginning as early as July 7. The USDA, following extensive collaboration between USDA Animal and Plant Health Inspection Service (APHIS) experts and their counterparts in Mexico to increase New World screwworm (NWS) surveillance, detection and eradication efforts, are set to begin a phased reopening of the southern ports starting with Douglas, Arizona.
Progress has been made in several critical areas since the ports were closed on May 11, and the USDA has not seen a notable increase in reported NWS cases in Mexico, nor any northward movement of NWS over the past eight weeks.
After reopening the Douglas, Arizona, port, the USDA will evaluate if any adverse effects arise. If not, it intends to reopen additional ports in New Mexico, and if it is proven safe to do so, in Texas, over the coming weeks. Additional port openings will be based on APHIS’ continuous reevaluation of the number of cases and potential northward movement of NWS, Mexico’s continued efforts to curb illegal animal movements, and implementation of further rigorous inspection and treatment protocols.
Farmer sentiment weakens on cloudy trade outlook
Farmer sentiment in June weakened after climbing the previous month to its highest level since May 2021, according to the latest Purdue University/CME Group Ag Economy Barometer.
“Shifting perceptions regarding the agricultural export outlook appeared to be a key reason behind producers’ weaker outlook, as fewer producers expressed optimism about future ag exports,” said James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture.
Meanwhile, strong income prospects for the livestock sector, especially among beef producers, are helping support the current farm income outlook.
The Ag Economy Barometer provides a monthly snapshot of farmer sentiment regarding the state of the agricultural economy. The survey collects responses from 400 producers whose annual market value of production is equal to or exceeds $500,000. Minimum targets by enterprise are as follows: 53% corn/soybeans, 14% wheat, 3% cotton, 19% beef cattle, 5% dairy and 6% hogs. Latest survey results, released July 1, reflect ag producer outlooks as of June 9-13.
GDT index down again
The price index of dairy product prices sold on the Global Dairy Trade (GDT) platform is down again, this time by 4.1% in the auction held July 1.
Compared to the previous auction, prices for individual product categories were mostly lower. Buttermilk powder and lactose were the only products trading higher at 9.3% and 4.2%, respectively. Whole milk powder, butter and anhydrous milkfat were also down by 4.2% to 5.1%. Cheddar cheese, skim milk powder and mozzarella were down by less than 3%.
The GDT platform offers dairy products from several global companies: Fonterra (New Zealand), Darigold, Valley Milk and Dairy America (U.S.), Inalpi (Italy), Arla (Denmark), Arla Foods Ingredients (Denmark), BMI (Germany), Kerry Dairy (Ireland) and Solarec (Belgium).
The next GDT auction is July 15.
July FSA interest rates slightly higher
The announced interest rates on loans through the USDA’s Farm Service Agency (FSA) are slightly higher for a second consecutive month. As we begin July 2025, interest rates for operating and ownership loans (compared to June) are as follows:
- Farm operating loans (direct): 5%, unchanged
- Farm ownership loans (direct): 5.875%, up from 5.75%
- Farm ownership loans (direct, joint financing): 3.875%, up from 3.75%
- Farm ownership loans (down payment): 1.875%, up from 1.75%
- Emergency loan (amount of actual loss): 3.75%, unchanged
The FSA also offers guaranteed loans through commercial lenders at rates set by those lenders. For more information, producers can contact their local USDA Service Center.
Lactalis USA completes acquisition of General Mills’ U.S. yogurt business
Lactalis USA, the U.S. affiliate of Lactalis, the world’s largest dairy company, has completed the previously announced acquisition of General Mills’ U.S. yogurt business.
With this acquisition, Lactalis USA acquires the Yoplait Go-Gurt, Oui, Mountain High and :ratio businesses in the U.S. The acquired business represents approximately $1.2 billion in annual net sales. The acquisition includes approximately 1,000 employees and two manufacturing facilities in Murfreesboro, Tennessee, and Reed City, Michigan.
The acquired business will operate as Midwest Yogurt, a newly formed division of Lactalis USA based in Minneapolis, Minnesota. Lactalis plans to invest significant resources in Midwest Yogurt employees, brands and manufacturing facilities to support the future growth of this new division.
Corn-planted acreage up, soybean acreage down
The USDA’s National Agricultural Statistics Service (NASS) estimated 95.2 million acres of corn planted in the U.S. for 2025, up 5% from last year, according to the Acreage report released June 30. Soybean area planted is estimated at 83.4 million acres, down 4% from last year.
Following up on the Prospective Plantings report released in March, NASS surveyed approximately 67,700 farm operators during the first two weeks of June to gather information on what farmers actually planted. Key findings released in the Acreage report include:
- Corn growers expect to harvest 86.8 million acres of corn for grain, up 5% from 2024. Ninety-four percent of all corn acres planted in the U.S. are biotech varieties, the same as 2024.
- Soybean-harvested area for 2025 is estimated at 82.5 million acres, down 4% from last year. Producers planted 96% of the soybean acreage using herbicide-resistant seed varieties, the same as 2024.
- All cotton-planted area for 2025 is estimated at 10.1 million acres, 10% below 2024.
- All wheat-planted area for 2025 is estimated at 45.5 million acres, down 1% from last year. Winter wheat-planted area is estimated at 33.3 million acres, down less than 1% from 2024. Other spring wheat-planted area is estimated at 10 million acres, down 5% from 2024. Durum wheat-planted area is estimated at 2.11 million acres, up 2% from last year.
NASS also released the quarterly Grain Stocks and Rice Stocks reports to provide estimates of on-farm and off-farm stocks as of June 1. Key findings in those reports include:
- Corn stocks totaled 4.64 billion bushels, down 7% from the same time last year. On-farm corn stocks were down 16% from a year ago, and off-farm stocks were up 6%.
- Soybeans stored totaled 1.01 billion bushels, up 4% from June 1, 2024. On-farm soybean stocks were down 12% from a year ago, while off-farm stocks were up 18%.
- All wheat stored totaled 851 million bushels, up 22% from a year ago. On-farm all wheat stocks were up 32% from last year, while off-farm stocks were up 20%.
- Durum wheat stored totaled 27.9 million bushels, up 32% from June 1, 2024. On-farm stocks of durum wheat were up 41% from June 1, 2024. Off-farm stocks of durum wheat were up 25% from a year earlier.
