You’ll recall March milk production was up 0.9 percent from a year ago. The USDA’s latest Dairy Products report shows that more milk was sent to the vat and churns.

HighGround Dairy pointed out the March Ag Prices report showed that the fat test average was 4.33 percent, a record for the month, and when combined with milk output, brought total butterfat pounds to 837.5 million for the month. This is a 3 percent year over year gain or 24.4 million pounds higher. This will keep a lid on butter prices for now, but the weaker markets should fuel greater exports, keeping things from plummeting.”

Cheese output totaled 1.226 billion pounds, up 9.8 percent from February, keeping in mind February had one less day due to leap year, but was up 1.4 percent from March 2024. Revisions added 1 million pounds to February’s total. Total output for the first three months of 2025 stood at 3.56 billion pounds, down 0.6 percent from 2024.

Wisconsin’s March production climbed to 304.4 million pounds, up 7.9 percent from February, and 2.8 percent above a year ago. California produced 215.2 million pounds, up 7.3 percent from February, but 0.1 percent below a year ago. Idaho contributed 90.0 million, up 18.3 percent from February, and 1.1 percent above a year ago. New Mexico, with 76.6 million pounds, was up 14.2 percent from February, but 7.6 percent below a year ago.

Mozzarella production totaled 405.8 million pounds, down 0.9 percent from a year ago, with year to date (YTD) output hitting 1.2 billion pounds, up 0.2 percent. American cheese hit 500.2 million pounds, up 13.0 percent from February, and 4.6 percent above a year ago. YTD American hit 1.4 billion pounds, up 2.2 percent.

Italian style cheeses totaled 517.9 million pounds, up 9.2 percent from February, but 0.2 percent below a year ago, with YTD at 1.5 billion pounds, down 0.2 percent from 2024.

Cheddar production jumped to 347.7 million pounds, up 40 million pounds or 13.0 percent from February, and 17.6 million or 5.4 percent above a year ago. Revisions added 1 million pounds to the February total. YTD Cheddar hit 984.4 million pounds, up 1.7 percent from a year ago.

Butter output jumped to 229.0 million pounds, up 26.3 million pounds or 12.9 percent from February, and 18.2 million or 8.6 percent above a year ago. YTD butter hit 649.9 million pounds, up 3.9 percent from a year ago.

Yogurt production totaled 460.2 million pounds, up 7.2 percent from a year ago, with output for the year so far at 1.3 billion pounds, up 6.3 percent.

Hard ice cream, at 60.4 million pounds, was up 7.9 percent from 2024. YTD production, at 175.5 million pounds, was down 0.5 percent from a year ago.

Dry whey output climbed to 70.0 million pounds, up 9.9 million pounds or 16.5 percent from February, but down 9.9 million or 12.4 percent from a year ago. YTD whey output hit 202.1 million pounds, down 12.0 percent from a year ago. Whey stocks grew to 64.2 million pounds, up 1.5 million or 2.4 percent from February, but down 17.1 million pounds or 21.0 percent from a year ago.

Nonfat dry milk output jumped to 168.0 million pounds, up 21.4 million or 14.6 percent from February, but down 16.8 million pounds or 9.1 percent from a year ago. NFDM YTD came in at 469.3 million pounds, down 0.4 percent from 2024. Stocks grew to 263.1 million pounds, up 12.8 million, or 5.1 percent from February, and up 44.9 million pounds or 20.6 percent from 2024.

Skim milk powder production, at 34 million pounds, was up 3.2 million pounds or 10.5 percent from February, but was down 4.6 million or 11.9 percent from a year ago. YTD SMP hit 99.3 million pounds, down 32.3 percent from 2024.

The USDA revised February’s nonfat dry milk stocks number down 78 million pounds, according to StoneX broker Dave Kurzawski. Speaking in the May 12 Dairy Radio Now broadcast, he said that’s one of the largest revisions ever and it supported the futures market “But it’s such a big number that it’s a little unsettling and I’m not sure that the markets fully believe that type of number.”

He said it may be revised but, other than that, production looked somewhat subdued. Butter output showed a strong number, lactose was up, and cheese was up 1.4 percent, “which is not earth shattering.”

Mozzarella output being down likely speaks to low domestic disappearance, certainly in pizza, according to Kurzawski, but the rise in CME cheese prices this week is based on reality. The export market is red hot, he explained, but if exports drop, we could see cheese drop 20 cents easily. If they stay strong and we turn up domestic demand, even a little, it could be 20 cents higher or more. Stocks to use data would dictate $1.90 cheese, he concluded, “But then you look at world prices which are at $2 plus and firming, U.S. prices look pretty cheap.”

Speaking of the portside of things: March U.S. dairy exports were up 2.8 percent from a year ago and hit the highest level in two years, thanks to strong sales of butter, cheese, dry whey, and nonfat dry milk. HighGround Dairy reported that the shipments were valued at $842.6 million, fourth-largest figure of all-time.

“U.S. product to Mexico, China and Canada, the top three export markets, all increased year-over-year by double digits,” says HGD, however, “These sales were likely booked in December and January after President Trump took office, but ahead of the tariffs, suggesting the big swings up were front-loading ahead of what was to come.”

Cheese exports hit 108.7 million pounds, down 1.5 percent from a year ago, however, “When adjusted on a 30-day basis, this ranks third all-time, behind March 2024 and February 2025,” according to HighGround. “U.S. cheese prices have been at a discount to the rest of the world since October, and that, coupled with the impending tariffs when these deals were made, kept totals lofty.”

Butter exports came in at 13.5 million pounds, up 170.8 percent, the highest monthly volume on a 30-day adjusted basis since April 2014. Canada’s imports were up 172 percent during the month and raised total butter exports through first quarter 94 percent.

HighGround adds, “Since February 2025, U.S. CME spot butter has maintained a roughly $1.00 per pound discount to European and New Zealand product prompting buyers to take advantage of the price disparity.”

Exports of nonfat and skim milk powder totaled 142.4 million pounds, up 1.4 percent from a year ago, though year to date sailings were still down 15.2 percent. The U.S. exported 39.4 million pounds of dry whey, up 8.1 percent from a year ago.

The first Global Dairy Trade event of May saw the weighted average jump 4.6 percent, following a 1.6 percent gain on April 15. Volume slipped to 36.8 million pounds, down from 36.9 million on April 15, and the lowest since May 5, 2020. The average metric ton price climbed to $4,516 U.S., up from $4,385.

Cheddar was up 12.0 percent, after slipping 1.8 percent last time, while Mozzarella was down 0.3 percent, following a 5.4 percent boost.