Dairy Industry News Roundup: Week of January 10-16, 2026

# Dairy Industry News Roundup: Week of January 10-16, 2026 Welcome to your weekly dairy industry briefing! This week delivered a landmark moment for dairy as whole milk officially returns to American schools, while USDA expanded the safety net for producers facing margin pressure. Here are the top stories from January 10 through January 16. **Heading to World Ag Expo?** The Therio team will be in Tulare, CA from February 9-11. [Schedule time to meet with us](https://calendly.com/therio) or email us at [info@therio.ai](mailto:info@therio.ai). --- ## From the Therio Team This Week ## 1. Preparing for AI's Impact in Dairy On paper, the modern dairy farm should be a data paradise. Cows wear sensors. Milking systems record every visit. Feed intakes are logged. Yet ask most dairy producers how AI is actually working for them, and the answer often lands somewhere between frustration and fatigue. Therio Co-Founder Logan Snyder examines why the real challenge is not smarter algorithms, but better "plumbing" for data to flow between systems. *Read more:* [Preparing for AI's Impact in Dairy: Integration, Interoperability & Real ROI](/learn/preparing-for-ais-impact-in-dairy-integration-interoperability-real-roi) --- ## 2. The Hidden Friction in Dairy Transactions Every cattle transaction carries invisible costs that slow deals, create disputes, and erode trust across the supply chain. From mismatched animal IDs to delayed paperwork and manual verification steps, the friction adds up in ways most participants have simply accepted as "how things work." Therio Co-Founder Greg Cochara draws on his software industry background to diagnose the root causes of these issues and what it would take to eliminate them. *Read more:* [The Hidden Friction in Dairy Transactions (and Why It Costs Everyone)](/learn/hidden-friction-in-dairy-transactions-and-why-it-costs-everyone) --- ## 3. USDA Revives Iconic "Milk Mustache" Campaign In conjunction with the Whole Milk for Healthy Kids Act signing, USDA launched a revival of the legendary "Got Milk?" aesthetic with a new promotional push featuring President Trump sporting a milk mustache. The imagery posted across USDA social channels carries the tagline "Drink Whole Milk" and marks a deliberate callback to the iconic advertising campaigns of the 1990s and 2000s. *Read our analysis:* [USDA Revives Iconic "Milk Mustache" Campaign Featuring President Trump to Promote Whole Dairy](/learn/usda-revives-milk-mustache-campaign-with-trump-whole-dairy-push) --- ## Other Industry News ## 4. Trump Signs Whole Milk for Healthy Kids Act In a historic moment for the dairy industry, President Trump signed the **Whole Milk for Healthy Kids Act** on Wednesday, January 15, reversing Obama-era restrictions that had banned higher-fat milk from school cafeterias for over a decade. **What changed:** - Schools in the National School Lunch Program can now serve **whole milk and 2% milk** alongside skim and low-fat options - Milk fat is now **exempt from federal saturated fat limits** in school meals - Parents can request milk substitutes with a simple **written note** instead of requiring a doctor's statement - Fortified nondairy milk alternatives that meet nutritional standards are also permitted **The scope:** - Approximately **30 million students** in the National School Lunch Program are affected - Implementation could begin as early as **fall 2026**, though timing will vary by district - USDA issued implementation guidance immediately following the signing The legislation passed Congress in fall 2025 with **unanimous bipartisan support**, sponsored by Senator Roger Marshall (R-KS), Senator Peter Welch (D-VT), Representative Glenn Thompson (R-PA), and Representative Kim Schrier (D-WA). Agriculture Secretary Brooke Rollins called the signing "a long-overdue correction," while HHS Secretary RFK Jr. linked previous low-fat milk policies to rising childhood obesity rates. The timing aligned with the 2025-2030 Dietary Guidelines released just days earlier, which emphasize full-fat dairy with no added sugars. *Read more:* [USDA Press Release](https://www.usda.gov/about-usda/news/press-releases/2026/01/14/whole-milk-back-president-trump-signs-whole-milk-healthy-kids-act) --- ## 5. USDA Announces Dairy Margin Coverage Expansion At the American Farm Bureau Convention on January 13, Agriculture Secretary Brooke Rollins announced significant improvements to the **Dairy Margin Coverage (DMC)** program for 2026. **Key changes:** - **Tier 1 coverage increased** from 5 million to 6 million pounds of production history - All dairy operations enrolling in 2026 will establish **new production history** - Operations can **lock in coverage for six years** (2026-2031) with a **25% premium discount** - Enrollment opened January 12 and runs through **February 26, 2026** **Why it matters now:** Analysts are forecasting that margins for at least **five months (January through May)** will fall below the $8 per hundredweight Tier II payment trigger. This means producers who enroll at higher coverage levels should receive payments during the first half of the year. The expansion comes at a critical time. With 2026 milk income margins potentially the lowest since 2023, the enhanced DMC program provides a more meaningful safety net for operations managing through tight economics. *Read more:* [USDA Announcement](https://www.usda.gov/about-usda/news/press-releases/2026/01/13/farm-bureau-convention-secretary-rollins-announces-dairy-margin-coverage-expansion-and-section-32) --- ## 6. Global Dairy Trade Rally Continues The positive momentum from early January carried forward as global dairy markets showed continued strength. The **January 6 Global Dairy Trade auction** delivered a **6.3% increase** in the price index, breaking a five-month slide. **Commodity highlights:** - **Whole milk powder**: Up 7.2% to approximately $3,407 per tonne - **Skim milk powder**: Up 5.4% to approximately $2,564 per tonne - **Anhydrous milkfat**: Up 7.4% to approximately $6,011 per tonne **Drivers behind the rally:** - Tighter powder supply as U.S. plants cut output approximately **10% year-over-year** - Increased milk flow to cheese production rather than powder - Seasonal demand patterns in key export markets While the rally offers encouragement, analysts caution against assuming sustained momentum. Global supplies remain ample, and the demand picture varies significantly by region and product category. *Read more:* [The Bullvine](https://www.thebullvine.com/news/global-dairy-markets-kick-off-2026-with-a-surprise-rally-but-dont-get-too-comfortable-yet/) --- ## 7. H5N1 Situation Remains Active in Dairy Herds The avian influenza situation in dairy cattle continues to demand attention, with new developments in multiple states. **Wisconsin update:** - The state announced its **first case of H5N1 in livestock** on December 14, 2025 - The detection involved a **500-cow herd** in the southeastern part of the state - Genetic analysis confirmed it was the **D1.1 genotype**, representing a new wildlife-to-cattle spillover event rather than farm-to-farm transmission **California update:** - Four dairy herds remain under quarantine for H5N1 - 43 cases have been confirmed in California dairies that were **re-quarantined after prior release** - The state continues enhanced surveillance and biosecurity protocols **Human case summary:** - Since the outbreak began in March 2024, infection has been confirmed in **70 people** in the United States - 41 cases involved dairy farm workers (36 in California, 2 in Michigan, 1 each in Colorado, Nevada, and Texas) - One infected person with underlying health conditions has died USDA continues implementing its National Milk Testing Strategy, and several vaccine candidates for dairy cows are currently undergoing field trials. The CDC maintains that public health risk remains low for the general population, though farm workers face elevated exposure risk. *Read more:* [USDA APHIS](https://www.aphis.usda.gov/livestock-poultry-disease/avian/avian-influenza/hpai-livestock) --- ## 8. Class I Prices at Multi-Year Lows The pricing environment continues to challenge dairy producers. The **January 2026 Class I Base Skim Milk Price** came in at **$11.17 per hundredweight**, the lowest level since April 2021. **Price context:** - Down **$1.57** from December 2025 - Down more than **$4** compared to January 2025 - Class III futures hovering around **$14.73 per hundredweight**, down 27% year-over-year **2026 outlook:** - USDA forecasts the **All-Milk Price at $18.75 per hundredweight** for 2026, down from $21.00 in 2025 - Margins for the first half of 2026 are expected to trigger DMC payments at higher coverage levels The silver lining: **retail dairy prices showed improvement in 2025**, with butter down 3.4% and cheese down approximately 2% compared to the prior year. This price moderation at the consumer level could support demand even as producer margins remain compressed. *Read more:* [Hoards Dairyman](https://hoards.com/article-18-class-i-milk-price.html) --- ## 9. 2025-2030 Dietary Guidelines Support Full-Fat Dairy The 2025-2030 Dietary Guidelines for Americans, released January 8, placed notable emphasis on **full-fat dairy products with no added sugars**. **Implications for schools:** - The guidelines create scientific backing for the newly signed Whole Milk for Healthy Kids Act - However, the emphasis on "no added sugars" raises questions about the future of **flavored milk** (chocolate, strawberry) in school cafeterias - USDA must now translate these guidelines into specific school meal regulations **Industry reaction:** Dairy organizations praised the guidelines for recognizing milk, cheese, and yogurt as nutrient-dense foods that support healthy eating patterns. The alignment between the dietary guidelines and new school milk legislation provides a consistent policy framework. Some nutrition advocacy groups have raised questions about advisory panel composition, but the industry views the guidelines as a validation of dairy's role in American diets. *Read more:* [NMPF Newsletter](https://www.nmpf.org/newsletter/news-for-dairy-co-ops-january-2026/) --- ## 10. Retail Whole Milk Hit Record $4.42 Per Gallon in 2025 New data from USDA shows that **retail whole milk prices averaged a record $4.42 per gallon in 2025**, up 3 cents from the prior year. **Retail pricing trends:** - Current advertised price: Approximately **$7.99 per gallon** for milk (all fat levels) - Organic milk premium: **$5.08 over conventional** per gallon - Organic whole milk averaged **$5.19 per half-gallon** in 2025 The gap between farm-level milk prices and retail prices continues to widen. While producers face multi-year low prices, consumers are paying record amounts at the grocery store. This disconnect reflects processing, transportation, and retail margins rather than farm-level economics. *Read more:* [Cheese Reporter](https://cheesereporter.com/news/2026/01/02/retail-whole-milk-prices-averaged-a-record-4-42-per-gallon-in-2025/) --- ## Market Snapshot: Week Ending January 16, 2026 | Indicator | Price/Value | Change | |-----------|-------------|--------| | Class I Base Skim (January) | $11.17/cwt | Lowest since April 2021 | | Class III Futures (Mid-Jan) | ~$14.73/cwt | Down 27% year-over-year | | 2026 All-Milk Price Forecast | $18.75/cwt | Down from $21.00 in 2025 | | GDT Price Index (Jan 6) | +6.3% | First increase since August 2025 | | Whole Milk Powder (GDT) | ~$3,407/tonne | Up 7.2% | | Retail Whole Milk (2025 avg) | $4.42/gallon | Record high | | DMC Tier 1 Coverage | 6 million lbs | Increased from 5 million | --- ## Looking Ahead **Key dates to watch:** - **Now through February 26, 2026:** Dairy Margin Coverage enrollment period - **February 9-11, 2026:** World Ag Expo in Tulare, California. **The Therio team will be there!** [Schedule time to meet with us](https://calendly.com/therio) or email us at [info@therio.ai](mailto:info@therio.ai). - **Fall 2026 (estimated):** Implementation of whole milk in school lunch programs **Industry priorities:** - Enrolling in expanded DMC program before the February 26 deadline - Managing through multi-year low milk prices with tight margins - Maintaining biosecurity protocols as H5N1 remains active in dairy herds - Preparing for whole milk demand increase from school lunch program changes - Monitoring how USDA translates new dietary guidelines into school meal rules --- *Stay informed with our weekly dairy industry roundups. For questions or tips, reach out at [info@therio.ai](mailto:info@therio.ai).*