Halfway through 2025, and the markets are favoring U.S. dairy product exports in part to continued price advantages on the global scene but also improved trade relations with China, which suppressed sales earlier in the year.

The USDA National Agricultural Statistics Service (NASS) released its Agricultural Prices report July 31, which includes feed costs and milk prices used to calculate the June Dairy Margin Coverage (DMC) program margins and indemnity payments.

After a nice run of Class III milk prices, July’s forecast price fell more than $1, reflective of a sharp drop in cheese prices from the growing processing capacity that is being met with a hardy supply. 

The Federal Milk Marketing Order (FMMO) advanced Class I base price rose 11 cents per hundredweight (cwt) from July to August for a Class I base price of $18.93 per cwt.

The first milk checks reflecting the Federal Milk Marketing Order (FMMO) revisions are arriving in producers’ mailboxes, reflecting both benefits and drawbacks of the revisions. At the same time, milk prices are softening after several months of relatively strong performances, perhaps the result of increased cow numbers and expanded processing capacity available in the marketplace now, among other influencing factors.

The dairy product export scene was both good and bad in May. Despite U.S. cheese exports setting yet another record for volume shipped in a single month, and others like butterfat, milk powder and high-protein whey posting year-over-year gains, shipments of low-protein whey and lactose to China plunged and caused a 2% decline in total year-over-year milk solids equivalent (MSE) exports.

Following the implementation of Federal Milk Marketing Order (FMMO) revisions, the prices per hundredweight (cwt) of milk sold into the Class III and Class IV markets are expected to rise in June.

It’s that time of year when the aroma of fresh-cut haylage lingers a little while longer in the air, plumes of dust billow along the side of the dirt roads as tractors and wagons run back and forth from the fields to the farm, and children are parading to the edges of a cornfield to see if it’s “knee-high by the Fourth of July.”