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Near record dairy shipments set in 2025, while butterfat hit new highs

An ag economist says declining cheese and butter prices continue to make U.S. products more competitive on the global market. 

USDA’s Anthony Fisher says U.S. dairy exports last year were the second largest on record in terms of volume and value. 

“We’re expecting butter prices to find some support in 2026 due to low stocks and strong export demand,” he said. “The recent fall is generally attributed to expanded milk production and butter churn output. Non-fat dry milk, on the other hand, prices have strengthened over the last several weeks.”

Fisher gave his annual dairy forecast during the USDA Ag Outlook forum on Friday.

Total U.S. dairy export volumes rose 13 percent in December and four percent on the year. Export values were up 15 percent for the year at $9.63 billion and close to the 2022 record.

Cheese exports gained 24 percent in December compared to 2024. The U.S. Dairy Export Council says demand from Mexico set a new monthly volume high for the month, and strong demand was also seen from South Korea and Australia. Year over year, cheese shipments were up 20 percent, with cheddar gaining 63 percent because of added processing capacity.

Butterfat shipments jumped 260 percent, with butter up 261 percent and anhydrous milk fat up 158 percent. Butter demand for the year was 163 percent higher, and anhydrous milk fat rose 176 percent, both setting new annual highs.

High protein whey exports gained three percent on the year, topping the previous record set in 2023. Dry whey shipments increased nine percent, while low-protein exports for the year were down 0.7 percent, largely impacted by trade disputes.

Whole milk powder exports gained 43 percent, and milk protein concentrate rose 43 percent.

Nonfat dry milk/skim milk powder exports increased 18 percent, mainly because of demand from Southeast Asia in December. Annual totals were down nine percent, partly because of reduced production along with weak demand from Canada and Mexico.