Heavy Milk Output Continues to Weigh on Dairy Product Pricing
- ZISK
- 1 day ago
- 1 min read
The T.C. Jacoby Weekly Market Report Week Ending October 17, 2025
The dairy industry is the victim of its own success. Heavy milk output continues to weigh on milk and dairy product prices. USDA’s Dairy Market News reports that in California, milk production tops year-ago levels by a wide margin, “edging into double digits.” The eye-popping year-over-year increase can be partially explained by the onset of the devastating bird flu last year and the healthier herd today. That does not change the fact that the market has significantly more milk to absorb than it did in late 2024 and early 2025. And milk output is higher in other regions too. Record-shattering components augment the increase. Rapid growth in European milk output adds to the strain.
Demand is not keeping pace. Restaurant traffic has fallen for seven straight months. Franchises are offering flashy promotions to keep customers coming through their doors. Pizza chains struggling with slower sales and discounted offerings are unlikely to be heavy-handed with the cheese.
October 20, 2025
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