Milk Is Sloshing Around the Heartland

amy55735
Apr 2
1 min read

Dairy producers are doing all they can to keep their barns and milk tanks full, and it shows. In the week ending March 15, they sent just 52,431 milk cows to beef packers, the lowest mid-March tally since 2008. In the first 11 weeks of 2025, the industry culled roughly 109,000 fewer cows than the historic average, helping to raise head counts despite the heifer shortage. More cows mean more milk, especially during the flush. Meanwhile, some dairy processors are taking downtime. Milk is sloshing around the heartland. This week, spot milk traded as much as $4 below class, while most loads changed hands at a $1.75 discount.

Cream remains abundant and cheap. That prompted an increase in ice cream manufacturing, but butter churns are also running hard. And there’s already plenty of butter in the larder. On February 28, stocks reached 305.5 million pounds, up 2.6% from the year before. That was the highest February tally since 2021, when inventories piled up due to Covid-era shutdowns. Setting aside 2021 as an anomaly, this was the largest February butter stockpile since 1993. However, the month-to-month increases in January and February were not as large as expected given formidable butter production. This implies that demand was strong to start the year.

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