Market tribulations stymie dairy demand, by: Corey Geiger

Early this year, most market signals indicated that dairy could have a bright 2025. After all, dairy continued to be a growth category with domestic retail sales climbing $2 billion over the past year to $78 billion, according to Circana. Restaurant sales climbed from $93.7 billion in March 2024 to $97.6 billion by November 2024. For exports, international cheese shipments grew 17% and reached a record 1.13 billion pounds last year. Dairy product exports posted $8.2 billion in sales, standing second only to the $9.5 billion all-time high in 2022.

However, headwinds have begun to blow on domestic dairy demand. Restaurant sales slid from $97.0 billion in December to $95.5 billion by February 2025, according to the U.S. Census Bureau and the National Restaurant Association. Earlier projections for strong export sales began to tarnish as tariff talk made importers jittery. As this was taking place, U.S. dairy farmers churned out record milk components driven by incentives in milk checks.

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