Milk Production Outweighs Demand

Demand has remained weak this fall, regardless of the approaching holidays. Retail and food service demand is behind the usual pace which alone has pressured cash prices. Exports are finding new avenues to ship U.S. Dairy products to despite the absent Chinese demand, but prices are struggling to find support with the growing supply chain.

On the Milk Production Report, the USDA showed a large increase in production from this time last year, up 4.2 percent from September 2024. The 24 major dairy producing states produced 18.3 billion pounds of milk which is a big increase from 2024, however less than August 2025’s revised 18.8 billion pounds.

In 2024, milk production spiked to these levels in the spring and then pulled back for the last seven months of the year, whereas 2025 has remained near the 2024 highs from March through August, having a slight pull back here in the September report data which came in 500 million pounds lighter than the previous month. In fact, the report called out the July-September production data was up 3.8 percent from the same period last year.

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By Sarah Jungman

Updated November 13, 2025 10:05 AM