Finding the bright spots

Milk production growth across the major dairy exporters (including the U.S.) is growing at the fastest pace in more than 20 years. The supply surge is pressuring cheese and butter prices to multi-year lows, and it’s unclear how long it will take for the market to start to rebound. But instead of writing another doom and gloom article, I want to focus on some bright spots in the dairy market. Consumer demand for high protein foods is showing up in the data for a number of different dairy products. The story around protein demand was positive prior to the introduction of GLP-1 drugs, but it has become supercharged since then.

The first bright spot is the price of whey. As cheese and butter prices were collapsing in the fourth quarter, whey protein isolate (WPI), whey protein concentrate 80 (WPC80) and dry whey prices were rallying on strong demand and tight inventories. After talking to those in the market, it sounds like the demand for high protein whey powders is still very strong through the first quarter, and prices will likely remain elevated. WPI and WPC80 prices don’t directly feed into the Federal Milk Marketing Order milk price calculations, but historically there has been some correlation between the high protein powders and the low protein dry whey that is included in the Class III milk price formula.

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December 18, 2025