In the news affecting a dairy producer's bottom line the third week of January 2026:
- February Class I base milk price hits 68-month low
- Fluid milk sales down 1.8% in November
- GDT index is higher again
- Producers reminded to apply for the On-Farm Stored Commodity Loss and Milk Loss Programs by Jan. 23
- USDA to host free biosecurity webinars for dairy and poultry producers
- USDA announces over $11 million awarded to support the U.S dairy industry
February Class I base milk price hits 68-month low
The Federal Milk Marketing Order (FMMO) advanced Class I base price will cast a small shadow for February, dipping to just $14.70 per hundredweight (cwt). The February base price is $1.65 per cwt below the base price for January 2026 and $6.57 per cwt less than February 2025. It’s the lowest Class I base milk price since June 2020.
Class I zone differentials are added to the base price principal pricing points to determine the actual Class I price in each FMMO. With those additions, February’s Class I prices should average about $18.82 per cwt across all FMMOs. The highest regional price is in the Florida FMMO at $21.50 per cwt, and the lowest price is $17.30 per cwt in the Arizona FMMO.
The February 2026 Class I base skim milk price was just $9.99 per cwt, a decline of $1.18 from January. The spread in the monthly advanced Class III milk pricing factor ($9.99 per cwt) and advanced Class IV skim milk pricing factor ($8.72 per cwt) was $1.27, with Class III being the “higher-of” and used as the Class I mover in the milk pricing formula. The advanced butterfat pricing factor was $1.44 per pound, a 15-cent fall from January.
The Class I base price and pooling percentages will impact regional FMMO uniform milk prices. January regional prices will be announced Feb. 11-14, with February regional prices announced a month later, on March 11-14.
Milk prices also impact Dairy Margin Coverage (DMC) program margins. Currently, the forecast indicates a small indemnity payment for December 2025 and then jumping sharply higher for January. The monthly margin is forecast below $9 per cwt through July.
The enrollment period for the 2026 DMC program is now open and closes on Feb. 26. Read: 2026 Dairy Margin Coverage enrollment underway, payments predicted
Fluid milk sales down 1.8% in November
Fluid milk sales for November 2025 were down from last year. According to data from the USDA Agricultural Marketing Service:
- Total sales: November 2025 sales of packaged fluid milk products were estimated at 3.6 billion pounds, down 1.8% from the same month a year earlier. At 38.9 billion pounds, year-to-date sales of all fluid products are 1.1% lower than last year.
- Conventional products: Monthly sales totaled 3.4 billion pounds, down 1.5% from the same month a year earlier. Sales of flavored whole milk were 13.4% higher than last year, and whole milk was up 1.3%. Year-to-date 2025 sales were estimated at 36.1 billion pounds, down 1% from this time last year.
- Organic products: November sales totaled 234 million pounds, down 6% than a year earlier. Sales were up 14.3% for flavored fat-reduced milk but down in all other categories. Year-to-date organic fluid milk sales were estimated at 2.7 billion pounds, down 1.8% from this time last year. Organic represented about 6.5% total fluid product sales in November.
The U.S. figures are based on consumption of fluid milk products in FMMO areas, which account for approximately 92% of total U.S. fluid milk sales, and adding the other 8% from outside FMMO-regulated areas. Sales outlets include food stores, convenience stores, warehouse stores/wholesale clubs, nonfood stores, schools, the food service industry and home delivery.
GDT index is higher again
The price index of dairy product prices sold on the Global Dairy Trade (GDT) platform is up 1.5% in the auction held Jan. 20. This is the second time the index moved higher following nine consecutive lower events.
Compared to the previous auction, prices for individual product categories were mixed. Anhydrous milkfat was up 3%, while butter and skim milk powder were up just over 2%. Whole milk powder was up 1%. Mozzarella was down 2.3%, lactose was down 1.8%, and cheddar cheese was down 1.4%. Buttermilk powder saw little change.
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 Feb. 3.
Producers reminded to apply for the On-Farm Stored Commodity Loss and Milk Loss Programs by Jan. 23
The USDA reminds producers to apply by Friday, Jan. 23, for the Milk Loss Program (MLP) and the On-Farm Stored Commodity Loss Program (OFSCLP).
MLP provides up to $1.65 million in payments to eligible dairy operations for milk that was dumped or removed without compensation from the commercial milk market because of a qualifying natural disaster event in 2023 and/or 2024. The following are examples of eligible losses:
- Delayed pickup of milk due to impassable roads from extreme snow drifting or other qualifying natural disasters
- Power outages due to qualifying natural disasters
- Infrastructure losses
Producers who suffered losses of eligible harvested commodities while stored in on-farm structures in 2023 and/or 2024 due to a qualifying natural disaster event may be eligible for assistance through OFSCLP, which provides up to $5 million to impacted producers. The following are examples of eligible losses:
- Flood destroys a grain bin with stored grain following torrential rains.
- Wildfire destroys a hay storage facility.
- Wildfire destroys grain stored in ag bags.
- High winds during a winter storm ripped open ag bags.
- Tornado destroys a grain bin full of stored grain.
To apply, submit MLP and OFSCLP applications to your local FSA county office. More information is available on the OFSCLP and MLP websites.
USDA to host free biosecurity webinars for dairy and poultry producers
The USDA will offer two free webinars focused on biosecurity best practices to help prevent the introduction and spread of highly pathogenic avian influenza (HPAI). These sessions are designed for dairy producers and poultry operations of all sizes.
Each webinar will cover practical steps producers can take to strengthen biosecurity controls and protect animal health. USDA experts will also highlight free resources available to support producers, including:
- Free biosecurity planning tools for poultry operations of all sizes
- Free biosecurity assessments for poultry operations with 500 or more birds
- Financial incentives for both poultry and dairy operations to enhance biosecurity measures
These webinars are an opportunity to learn proven strategies, access tools and ask questions to help safeguard your animals. Click on the respective webinar below to register.
- Secure Our Herds: Preventing Bird Flu on Dairy Farms – Wednesday, Jan. 28, at 2:30 p.m. Eastern time
- Defend the Flock: Preventing Bird Flu in Poultry – Friday, Jan. 30, at 2 p.m. Eastern time
USDA announces over $11 million awarded to support the U.S dairy industry
The USDA announced it is awarding more than $11 million in grant funding to support dairy businesses and producers through the Dairy Business Innovation Initiatives (DBI) grant program. The initiatives support small and midsized dairy businesses in the development, production, marketing and distribution of dairy products.
“This funding through the Dairy Business Innovation Initiatives makes important investments in the domestic dairy industry, furthering USDA’s efforts to ensure Americans have access to affordable wholesome U.S. dairy products,” said USDA undersecretary for marketing and regulatory programs, Dudley Hoskins.
This year’s funds are being awarded noncompetitively to the four current DBI Initiatives at California State University, Fresno; the University of Tennessee; Vermont Agency of Agriculture, Food & Markets; and the University of Wisconsin. The initiatives will use the funding to provide valuable technical assistance and subaward funds to dairy farmers and businesses across their regions, supporting them with business plan development, marketing and branding, as well as increasing access to innovative production and processing techniques to support the development of value-added products.
For more information, visit the AMS Dairy Business Innovation Initiatives webpage. Dairy farmers and businesses interested in the program must contact the appropriate initiative to be considered for direct technical assistance or a subaward.
