The USDA’s monthly World Ag Supply and Demand Estimates (WASDE) report was released Feb. 10.
Milk production, prices
The milk production forecast for 2026 is raised on faster growth in milk per cow more than offsetting lower expected cow inventory. Estimated milk production is at 234.5 billion pounds. Fat basis imports are reduced primarily on lower imports of butter. Imports on a skim solids basis are unchanged. Exports are raised on a fat basis on higher exports of butter and cheese but reduced on a skim solids basis on lower casein and lactose.
For 2026, the cheese, butter, nonfat dry milk (NDM) and whey price forecasts all increased on recent prices. The Class III milk price forecast was raised to $16.65 per hundredweight (cwt), and the Class IV milk price was also raised to $15.70 cwt. The 2026 all-milk price is raised 70 cents to $18.95 per cwt.
Beef outlook
For 2026, beef production is raised on higher slaughter of steers and heifers, increased cow slaughter and slightly heavier dressed weights. The USDA’s January Cattle report estimated that the 2025 calf crop was lower than the previous year, but as of Jan. 1, more cattle held outside feedlots were available to be placed during the first half of 2026.
Fed cattle price forecasts for 2026 are raised for all four quarters on recent prices and continued demand strength. The 2025 average was forecast at $224.37 per cwt, while the 2026 average is now forecast at $240 per cwt, with highest prices in the fourth quarter of the year.
Feed supply, price forecasts
The USDA’s WASDE report provided potential insights into dairy feedstuff supplies and prices:
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Corn: This month’s WASDE 2025-26 U.S. corn outlook called for greater exports and lower ending stocks.
- At $4.10 per bushel, the projected season-average corn price received by producers is unchanged from the previous report and down a quarter from the 2024-25 average of $4.35 per bushel.
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Soybeans: This month’s 2025-26 U.S. soybean supply is unchanged.
- The 2025-26 U.S. season-average soybean price is projected at $10.20 per bushel, and unchanged from last month. The soybean meal and oil prices are also unchanged at $295 per short ton and 53 cents per pound.
- Cottonseed: This month’s 2025-26 U.S. cotton balance is minimal this month with production, beginning stocks and mill use unchanged.
- The projected season-average farm price is lowered a penny to 60 cents per pound, a decline of 3 cents from last year and 31 cents since 2021-22.
Alfalfa and other hay
The latest USDA Ag Prices report indicated dairy-quality alfalfa hay prices averaged $211 per ton in December, while alfalfa hay prices averaged $161 per ton, and prices for other hay averaged $128 per ton.
