Dairy Industry News Roundup: Week of December 27, 2025 - January 2, 2026

# Dairy Industry News Roundup: Week of December 27, 2025 - January 2, 2026 Welcome to the first news roundup of 2026! As the industry transitions into the new year, here are the top stories from December 27 through January 2. --- ## 1. Wisconsin HPAI Detection Confirmed as New Wildlife Spillover Event The USDA confirmed that the **H5N1 avian influenza** case detected in a Wisconsin dairy herd on December 14 represents a **new, independent spillover event** from wildlife, separate from previous outbreaks. Genetic sequencing by the National Veterinary Services Laboratories identified the virus as **H5N1 clade 2.3.4.4b genotype D1.1**, the same variant found in Nevada and Arizona earlier this year, but originating from a distinct wildlife source. Key implications: - **Unexpected location**: Before this detection, spillover risk was thought limited to desert areas where migratory birds share water and feed sources with cattle - **Dodge County herd**: Approximately 500 cows affected, detected through the National Milk Testing Strategy - **Total U.S. impact**: Over 1,074 herds across 19 states have been infected since March 2024 - **Economic toll**: Estimated $950 per clinically affected cow, with one Ohio herd study showing $737,500 in total losses The good news: Infected cows typically recover in 2-3 weeks, with mortality rates around 2% or less. Most milk loss occurs during a 7-10 day window of reduced production. *Read more:* [USDA Announcement](https://www.aphis.usda.gov/news/agency-announcements/update-genetic-sequencing-results-wisconsin-dairy-herd-detection-highly) --- ## 2. Julie Callahan Confirmed as Chief Agricultural Negotiator The Senate confirmed **Dr. Julie Callahan** as Chief Agricultural Negotiator at the Office of the U.S. Trade Representative on a **53-43 vote** in mid-December, with over 80 trade associations supporting her nomination. Dr. Callahan brings extensive experience: - With USTR since 2016, previously serving as Assistant U.S. Trade Representative - Senior leadership positions at FDA and USDA Foreign Agricultural Service - Deep understanding of international agricultural trade policy Industry groups welcomed the confirmation: - **International Dairy Foods Association** called her "a fierce and reliable ally" - **American Farm Bureau Federation** highlighted her experience across USTR, FDA, and USDA - **U.S. Meat Export Federation** described her as "a tireless advocate for U.S. agriculture" Her priorities include reopening Chinese markets (not just for soybeans), enforcing existing trade agreements, and reducing tariff and non-tariff barriers for American farmers. *Read more:* [Southeast AgNet](https://southeastagnet.com/2025/12/26/ustr-chief-agricultural-negotiator-julie-callahan/) --- ## 3. New World Screwworm Threat Reaches Texas Doorstep The **New World Screwworm**, a flesh-eating parasitic fly eradicated from the U.S. in 1982, is now within striking distance of Texas. A case was confirmed in Tamaulipas, Mexico, near the South Texas border in early January. Current situation: - **14 total cases** detected within 400 miles of the U.S.-Mexico border as of December 9 - **Nuevo Leon detections**: Cases found 70-120 miles from Texas in late 2025 - **Border closed** to Mexican cattle, bison, and horses since May 11, 2025 The potential economic damage is staggering: - **$1.9-2.1 billion** in annual losses to Texas cattle alone - **$9 billion** potential damage to hunting and wildlife industries - Texas holds 12.5 million cattle (14% of the U.S. total) Response efforts include a **$750 million sterile fly production facility** under construction near Edinburg, Texas, expected to produce 300 million sterile flies per week when operational in early 2026. Positive news: On December 4, the FDA conditionally approved **Exzolt Cattle-CA1** (fluralaner), the first drug specifically for screwworm prevention and treatment in beef cattle. *Read more:* [Texas A&M Stories](https://stories.tamu.edu/stories/what-is-the-new-world-screwworm-and-why-does-it-matter-to-texas/) --- ## 4. Beef-on-Dairy Continues as Major Profit Driver for 2026 The beef-on-dairy crossbreeding trend shows no signs of slowing, with **72% of dairy farms** now incorporating beef genetics into their breeding programs. Why it matters: - **Crossbred calves command $350-700 premiums** per head compared to purebred Holstein calves - **Holstein cross calves fetch $500+** versus approximately $50 for purebreds - **Dairy-origin animals** now account for 18-24% of U.S. beef production - Beef-on-dairy crosses have **replaced approximately 70% of Holsteins** in the fed cattle harvest mix New research from Penn State (January 2025) found that beef-on-dairy crosses often **recover from pneumonia without antibiotics**, attributed to hybrid vigor. Calves experiencing pneumonia only delay growth by about 3 weeks before compensatory growth kicks in. The practice helps dairy farms diversify revenue amid volatile milk prices while contributing significantly to beef supply during a period of low beef cattle inventory. *Read more:* [American Farm Bureau Federation](https://www.fb.org/market-intel/beefing-up-dairy-the-rise-of-crossbreeding) --- ## 5. Protein Drives Dairy Trends Heading into 2026 High-protein dairy products are dominating consumer demand as the new year begins, with **cottage cheese** emerging as a surprising star. Market performance: - **Protein-enhanced dairy variants**: Up 45% year-over-year - **Organic cottage cheese sales**: Up 30% - **Single-serve cottage cheese packaging**: Up 58% YoY - TikTok-fueled trends driving demand and even temporary shortages Key demand drivers: - **GLP-1 synergy**: Cottage cheese and yogurt positioned as ideal foods for users of weight-loss medications like Ozempic - **Clean label demand**: 82% market penetration of clean-label products - **Convenience**: Urban lifestyles driving ready-to-eat and single-serve formats MMPA's recent $122.68 million investment to enter cottage cheese production reflects this trend (see last week's roundup). *Read more:* [Dairy Reporter](https://www.dairyreporter.com/Article/2025/12/19/dairy-trends-2026-premiumization-glp-1-protein-and-health-driven-innovation/) --- ## 6. Workforce Development Becomes Top 2026 Priority As dairy operations plan for 2026, **workforce development** has emerged as a critical focus area, moving beyond simple hiring to cultivation and retention strategies. Key challenges: - **51% of dairy workers are immigrants**; 79% of U.S. milk comes from farms employing immigrant labor - **Mexico's declining birth rate** is shrinking the traditional labor pipeline - **Immigration policy uncertainty** remains a top CEO concern Industry response: - **Northeast Dairy Producers Association** prioritized $150,000 for Cornell's Ag Workforce Development Program - More than 50% of surveyed farms now provide employee housing - Investment in robotic milking systems reducing labor needs 40-60% - Training programs shifting toward critical thinking, data analysis, and tech-assisted management The Farm Workforce Modernization Act remains the industry's primary legislative focus, seeking year-round H-2A visa access for dairy operations. *Read more:* [Dairy Herd](https://www.dairyherd.com/news/labor-challenges-call-change-and-innovation) --- ## 7. Netherlands Delays Electric Cattle Prod Ban The Netherlands' planned **complete ban on electric cattle prods**, originally set for January 1, 2026, has been **delayed** pending ministerial approval. Background: - Authorities cited systematic misuse of electric shockers despite EU regulations - The ban was highlighted in 2023 after footage of misconduct during animal transport was released - Animal rights party PvdD has requested a parliamentary debate, with majority MP support Meanwhile, 90 large and medium slaughterhouses in the Netherlands operate a voluntary video surveillance system aimed at reducing electric shocker use and improving animal welfare standards. *Read more:* [DutchNews.nl](https://www.dutchnews.nl/2025/11/minister-delays-electric-cattle-prod-ban-angry-mps-want-answers/) --- ## Market Snapshot: Week Ending January 2, 2026 | Indicator | Price/Value | Change | |-----------|-------------|--------| | Class I Base (January) | $16.35/cwt | Down from December | | 2026 All-Milk Price Forecast | $18.75/cwt | Down from $21.00 in 2025 | | Conventional Milk (retail gallon) | $2.69 | Down 7 cents | | Organic Milk (retail gallon) | $8.18 | Stable | | GDT Price Index (Dec 16) | -4.4% | 9th consecutive decline | | U.S. Dairy Herds with HPAI | 1,074+ | Across 19 states | --- ## Looking Ahead to January 2026 **Key dates to watch:** - **January 6, 2026:** First Global Dairy Trade auction of the year (Event 395) - **February 11-13, 2026:** World Ag Expo in Tulare, California **Industry priorities:** - Monitoring HPAI wildlife spillover risk as spring approaches - Tracking New World Screwworm developments near Texas border - Following implementation of Whole Milk for Healthy Kids Act in school districts - Workforce development and automation investments - Navigating policy changes under the new administration --- *Happy New Year from the Therio team! Stay informed with our weekly dairy industry roundups. For questions or tips, reach out at [hello@therio.ai](mailto:hello@therio.ai).*