Dairy Industry News Roundup: Week of July 18 - 24, 2026

# Dairy Industry News Roundup: Week of July 18 - 24, 2026 Cheese blocks pushed to $1.66/lb at the CME by Tuesday, July 22, recovering from the prior week's softness, even as NDM slid to $1.43/lb and butter struggled below $1.58/lb, underscoring a split market heading into the heart of summer 2026. HPAI H5N1 in dairy cattle crossed the 1,166-herd threshold across 19 states as of July 22, with Idaho now the nation's hardest-hit state, while USDA's July WASDE-673 raised the 2026 milk production forecast to 236.6 billion pounds but cut price forecasts for NDM, cheese, and butter on the weight of growing supply. The Global Dairy Trade platform's July 7 auction posted a 4.9% price index decline, its third consecutive drop and largest of the year, setting a cautious tone heading into the July 21 GDT event. --- --- ## 1. This Week From Therio The team is heads-down building this week. If you missed our recent long-form pieces from co-founder Greg Cochara, both are worth catching up on: - [Herdscripting 101: The Hidden Infrastructure Behind Every Dairy Treatment](/news/herdscripting-101) - [Interstate Movement of Dairy Cattle: The Compliance Maze Nobody Talks About](/news/interstate-movement-101) --- ## Industry News ## 2. CME Spot Dairy Markets: Cheese Firms as Butter and NDM Slip Cheese prices built momentum through the week of July 18-24, with 40-pound blocks gaining $0.03 on Tuesday, July 21, to reach $1.66/lb, following a Monday open at $1.63/lb. Cash dairy prices were mixed Monday, July 20, with 40-pound cheese blocks up $0.0025 to $1.63, with five sales recorded ranging from $1.6275 to $1.63. By Tuesday, blocks continued their climb. Cash dairy prices were mixed on Tuesday, July 21, at the Chicago Mercantile Exchange, with 40-pound cheese blocks up $0.03 to $1.66, on three sales ranging from $1.6350 to $1.6575. Cheese barrels, however, showed relative steadiness entering the week. Cheese barrels were up $0.0150 to $1.6275 on Monday, with no sales recorded. Barrels were unchanged at $1.6275 on Tuesday, again with no sales recorded. The divergence between blocks and barrels is worth noting for Class III milk price implications: the block-barrel spread widened modestly, signaling retail and food service cheese demand pulling ahead of manufactured product usage. The week's prior benchmark came from the USDA Dairy Market News weekly report covering July 13-17. Butter Grade AA closed at $1.5900 with a weekly average of $1.6085, down $0.0415 for the period. Barrels closed at $1.6125 and 40-pound blocks at $1.6275, with barrel weekly average of $1.5950, up $0.0680, and block weekly average of $1.6055. NDM Grade A closed at $1.4700. Extra grade dry whey closed at $0.6950. | Product | July 13-17 Close | July 20 | July 21 | Weekly Trend | |---|---|---|---|---| | 40-lb Blocks | $1.6275/lb | $1.6300/lb | $1.6600/lb | Firming | | Barrels | $1.6125/lb | $1.6275/lb | $1.6275/lb | Sideways | | Butter Grade AA | $1.5900/lb | $1.5725/lb | $1.5750/lb | Soft | | NDM Grade A | $1.4700/lb | $1.4500/lb | $1.4300/lb | Declining | | Dry Whey (Extra) | $0.6950/lb | $0.6950/lb | $0.6975/lb | Steady/Firm | Butter opened the week under pressure. Butter was down $0.0175 to $1.5725 on Monday, with nine sales recorded ranging from $1.56 to $1.5725. A slight recovery on Tuesday brought marginal relief. Butter was up $0.0025 to $1.5750 on Tuesday, with twelve sales recorded ranging from $1.56 to $1.5650. NDM continued its slide, dropping to $1.43 by Tuesday. Nonfat dry milk was down $0.02 to $1.43, with twenty-five sales reported ranging from $1.42 to $1.45. Dry whey showed the most resilience of the powders. Dry whey was up $0.0025 to $0.6975 on Tuesday. ## 3. USDA WASDE-673: Milk Output Raised to 236.6 Billion Pounds, Prices Cut The July 10 WASDE-673 report delivered a net bearish message for dairy prices even as it acknowledged a larger national herd. USDA's July WASDE raised 2026 milk production slightly to 236.6 billion pounds on expectations of a larger cow herd and a decrease in milk output per cow. The revision builds further on a year of robust supply growth. At 236.6 billion pounds, the 2026 milk production estimate was raised from last month's report and would be up 4.9 billion pounds from 2025's total of 231.7 billion pounds. Milk production forecasts are raised for both 2026 and 2027. Based on the latest Milk Production report, cow inventories are also raised for both 2026 and 2027. Milk output per cow is reduced slightly for 2026 but unchanged for 2027. The divergence between a larger herd and lower per-cow productivity reflects the ongoing heat stress impact on components, especially in the Central and Western regions. For 2026, the price forecasts are lowered for nonfat dry milk, cheese, and butter due to continuing strong growth in the milk supply. The whey price is unchanged from last month. The all-milk price trajectory bears watching: the all-milk price forecast for 2026 is lowered to $20.70 per cwt. Producers relying on Dairy Margin Coverage (DMC) or Dairy Revenue Protection (Dairy-RP) should update scenario models with these revised benchmarks ahead of the August 12 WASDE. | WASDE-673 Metric | July 10 Estimate | Prior Month | Change | |---|---|---|---| | 2026 Milk Production | 236.6 bil lbs | 236.4 bil lbs | +0.2 bil lbs | | 2025 Actual | 231.7 bil lbs | 231.7 bil lbs | Reference | | 2026 All-Milk Price | $20.70/cwt | Higher | Lowered | | 2026 NDM Price | Lowered | Prior forecast | Down | | 2026 Cheese Price | Lowered | Prior forecast | Down | | 2026 Whey Price | Unchanged | Prior forecast | Flat | ## 4. USDA Dairy Market News (July 13-17): Heat, Cream Tightness, and Whey Strength The prior week's USDA Dairy Market News report for July 13-17 set the stage for the current week's dynamics. The report shows mixed CME prices: butter down, cheese up, dry whey higher. Summer heat is impacting milk output in the Central region and Idaho. Cold storage shows butter stocks up 8%, cheese down. Regional supply conditions were stressed by heat. Parts of the eastern dairy region, particularly Pennsylvania, are experiencing an abnormally high heat wave that creates uncertainty in short-term output. Idaho recorded its hottest weekend of 2026, which processors say is affecting cow comfort, milk production, and milk components. In the Pacific Northwest, the picture was more nuanced. According to the latest NASS milk production report, Oregon's milk cow numbers increased and Washington's decreased in May 2026 compared to the same month last year, with Oregon showing a 7.1 percent milk production increase. Cream availability and butter production were bifurcated by region. Spot cream loads are tighter in some parts of the country. Spot cream demand from butter manufacturers varies from steady to stronger. Butter production schedules are mixed but are generally busier in the West region. Cold storage data confirmed ongoing inventory divergence. As of July 1, 2026, butter stocks totaled 68,992 pounds, an increase of 5,317 pounds or 8 percent. Cheese inventories stood at 84,726 pounds, a decrease of 199 pounds from the earlier date. On the whey side, fundamentals remained constructive. Dry whey prices in the East moved higher, supported by reported trading activity and aligning with CME trades. Manufacturers continue to prioritize whey protein concentrate 80% and whey protein isolate production due to active demand from sports nutrition and protein-enhanced food formulations. ## 5. HPAI H5N1 Tops 1,166 Confirmed Dairy Herds; Idaho Leads at 173 The H5N1 outbreak in U.S. dairy cattle crossed a grim milestone this week. As of July 22, 2026, USDA APHIS has confirmed over 1,166 infected dairy herds across 19 states, with Idaho now leading the national count at 173 affected herds. The outbreak now spans more than two years since the first dairy confirmation in March 2024, and shows no signs of rapid containment. Idaho's position at the top of the herd count is particularly significant given the state's scale of dairy operations and the heat stress conditions documented by processors during the week of July 13-17. The ongoing National Milk Testing Strategy (NMTS), which requires raw milk samples from dairy processing facilities nationwide to be submitted for H5N1 testing, continues to serve as the primary early warning system for new herd-level infections. Results from the NMTS are reported to USDA and state veterinary authorities. The NMTS remains the backbone of surveillance, feeding early detection signals to state veterinarians for rapid on-farm response. Vaccine development is progressing but has not yet reached commercial deployment. Several H5N1 vaccine candidates for dairy cows are currently undergoing USDA-supported field trials, though no vaccine is yet approved for use in cattle. Public health authorities maintained their risk assessment. The CDC's public human health risk assessment for H5N1 in dairy cattle remains low for the general U.S. public. Testing to date has not found changes in the virus that would make it more transmissible to humans, according to USDA APHIS. | State | Herd Status | Notes | |---|---|---| | Idaho | 173 confirmed herds | National leader | | 18 other states | Remaining confirmed herds | Spread across 19-state footprint | | Total U.S. | 1,166+ confirmed herds | As of July 22, 2026 | | Vaccine | Not yet approved | Field trials ongoing | | NMTS | Active nationwide | Primary surveillance mechanism | The 19 affected states documented by APHIS include Arizona, California, Colorado, Idaho, Iowa, Kansas, Michigan, Minnesota, Nebraska, Nevada, New Mexico, North Carolina, Ohio, Oklahoma, South Dakota, Texas, Utah, Wisconsin, and Wyoming. Producers in all these states should be maintaining USDA APHIS compliance with interstate movement testing requirements and NMTS bulk tank sampling protocols. ## 6. Global Dairy Trade: July 7 Auction Posts Largest 2026 Decline; July 21 Event Awaited The GDT auction held July 7 delivered the most significant price shock of the year. The price index of dairy product prices sold on the Global Dairy Trade platform was down 4.9% in the auction held July 7. This is the third consecutive negative trading event and the largest decrease in 2026. Compared to the previous auction, prices for individual product categories were mostly lower. Product-level losses were broad and severe. Cheddar cheese was down 12.3%, followed by skim milk powder, down 7%. Butter and whole milk powder were down by 5% and 4.4%, respectively, while anhydrous milkfat and lactose were down just under 4%. Buttermilk powder increased 8.2%, and mozzarella was up 3.8%. The breadth of the decline points to structural oversupply from both Northern and Southern Hemisphere sources rather than a single-product-driven move. | GDT July 7 Product | Price Change | |---|---| | Cheddar Cheese | -12.3% | | Skim Milk Powder | -7.0% | | Butter | -5.0% | | Whole Milk Powder | -4.4% | | Anhydrous Milkfat | -3.9% (approx.) | | Lactose | -3.9% (approx.) | | Buttermilk Powder | +8.2% | | Mozzarella | +3.8% | | GDT Price Index | -4.9% | The GDT platform offers dairy products from several global companies, including Fonterra (New Zealand), Darigold, Valley Milk, and Dairy America (U.S.), Inalpi (Italy), Arla (Denmark), Arla Foods Ingredients (Denmark), BMI (Germany), Kerry Dairy (Ireland), and Solarec (Belgium). The platform serves as a critical price discovery signal for export-oriented U.S. processors, particularly those handling NDM and whey. The next GDT auction was July 21. Results from that event will be critical context for the week ahead, particularly given the breadth of the July 7 decline. Broader global dairy supply context reinforced the bearish GDT tone. The volume traded on GDT had been on a downward trend to 12,922 tonnes as of June 16, 2026, before rising back to 26,316 tonnes as of July 7, 2026. The rebound in volumes traded at lower prices suggests buyers returned to the market opportunistically rather than out of structural need. ## 7. USDA NDPSR: Butter Averaged $1.66/lb, Cheddar at $1.50/lb for Week Ending July 11 The National Dairy Products Sales Report (NDPSR) for the week ending July 11, 2026, provided the mandatory-reporting benchmark prices underpinning Class pricing and farm-level settlement. Butter prices received for 25-kilogram and 68-pound boxes meeting USDA Grade AA standards averaged $1.66 per pound for the week ending July 11, 2026. Cheddar cheese prices received for 40-pound blocks averaged $1.50 per pound for that week. The U.S. price per pound decreased 1.9 cents from the previous week. Dry whey prices received for bag, tote, and tanker sales meeting USDA Extra Grade standards averaged 64.7 cents per pound for the week ending July 11, 2026. The U.S. price per pound decreased 0.6 cents from the previous week. Nonfat dry milk prices received for bag, tote, and tanker sales meeting USDA Extra Grade or USPHS Grade A standards averaged $1.71 per pound for the week ending July 11, 2026. The NDPSR cheddar block average of $1.50/lb trails the CME spot close of $1.6275 for that same period, a spread that reflects the lag between traded contract prices and actual reported sales volumes captured in mandatory reporting. Producers and cooperatives using NDPSR-derived Class III settlements should account for this spread when evaluating forward positions. ## 8. FMMO Class I Base Price and DMC Margin: Signals for the Second Half Federal Milk Marketing Order dynamics heading into the second half of 2026 reflect the tension between a record-size national herd, heat-stressed per-cow productivity, and declining commodity prices. After four consecutive months of the advanced Class I base price climbing, July's price showed some retreat at $21.33 per cwt. May FMMO uniform prices reflected a market that was still trending constructively before the July WASDE reset expectations. The average FMMO uniform milk price climbed 85 cents in May for an average price of $20.87 per cwt across all 11 orders. The DMC margin remained workable for diversified operations through May. The USDA NASS Agricultural Prices report, released June 29, established May's DMC program calculations. As the all-milk price rose 50 cents, the total feed costs rose 42 cents, boosting the DMC margin 8 cents to $10.62 per hundredweight for the month. The structural challenge for producers going forward is clear. Milk production across the U.S. has been rampant in 2026 with both processing capacity and global demand pressuring dairy farms to produce more, and a larger national dairy herd is helping keep the pace. Despite all the dynamics working in favor of U.S. dairy farmers, milk margins remain tight and risk management strategies remain critical. | FMMO/DMC Metric | Value | Period | |---|---|---| | Advanced Class I Base Price | $21.33/cwt | July 2026 | | Avg. FMMO Uniform Price | $20.87/cwt | May 2026 | | DMC Margin | $10.62/cwt | May 2026 | | All-Milk Price Forecast (WASDE) | $20.70/cwt | 2026 Annual | | Class III Spot Range | $2.00 under to $5.00 over Class | Week of July 13-17 | ## 9. Feed Cost Backdrop: Corn Steady at $4.40/bu; Heat Stress Complicating Component Management The feed cost environment remained relatively stable entering this week, offering some cushion against falling milk prices. The July WASDE 2026-27 U.S. corn outlook is for smaller supplies, greater exports, and reduced ending stocks. Corn production for 2026-27 is up fractionally based on updated planted and harvested area from the June 30 Acreage report. The yield is unchanged at 183 bushels per acre. At $4.40 per bushel, the projected season-average corn price received by producers is unchanged from the previous report and up a quarter from the 2024-25 average of $4.15 per bushel. While $4.40/bu corn is not historically extreme, the trajectory of flat-to-firming feed costs against declining milk prices will pressure DMC margins in coming months if commodity benchmarks do not stabilize. Regional heat stress was the week's dominant agronomic narrative in the dairy belt. Parts of the eastern dairy region, particularly in Pennsylvania, experienced an abnormally high heat wave creating uncertainty in short-term milk output. Idaho recorded its hottest weekend of 2026, which processors say is affecting cow comfort, milk production, and milk components. The combination of heat-suppressed components and flat corn costs means producers in affected regions face a component-quality headwind even if feed economics remain manageable. ## 10. Herd Dynamics: Dairy Cow Slaughter Running Above Year-Ago Pace Herd management decisions in 2026 have been notable, with dairy cow slaughter running elevated relative to last year even as the total herd size is growing. Federally inspected dairy cow slaughter during the first five months of 2026 totaled 1.13 million head, about 43,400 head above last year's slaughter levels. The accelerated culling pace is consistent with producers managing older or less productive animals out of larger herds as fresh heifer additions inflate total inventory. The overall herd trajectory remains expansionary, a central driver of the WASDE-673 production upgrade. Milk production forecasts are raised for both 2026 and 2027. Based on the latest Milk Production report, cow inventories are also raised for both 2026 and 2027. Pacific Northwest herd and production data added regional color: Oregon's milk cow numbers increased and Washington's decreased in May 2026 compared to the same month last year, with Oregon showing a 7.1 percent milk production increase. From a global supply benchmark, the Southern Hemisphere is also contributing to the bearish production environment. Australia's May 2026 milk production was 654.0 million liters, up 33.7 million liters or 5.4 percent year-over-year. A forecasting group in Australia raised its opening milk price for the 2026-2027 season by 15 cents per kilogram of milk solids, to a range of $8.80 to $9.60 per kgMS. New Zealand's May 2026 milk output was 1.02 million metric tons, up 3.6 percent year-over-year, with milk solids rising 5.0 percent to 108.7 million kg. ## 11. U.S. Dairy Exports: Eight Consecutive Months of Volume Growth Through May U.S. dairy export momentum heading into this reporting period had been exceptional. May proved to be another enthusiastic month for U.S. dairy exports, with the year-over-year volume growth streak now reaching eight consecutive months as exports rose 14% in milk solids equivalent terms. All of this is despite low nonfat dry milk/skim milk powder shipments, due to steep price comparison, reigning in what might have been a record month. The WASDE-673 export revisions reflected this underlying strength while acknowledging product-level headwinds. For 2026, commercial export forecasts are raised on a skim-solids basis, primarily due to increased shipments of cheese and whey-containing products, but unchanged on a fat basis. For 2027, exports are also raised on both a fat and skim-solids basis due to increased shipments of cheese, butter, and whey-containing products. The NDM/SMP competitive disadvantage against European and Oceanian suppliers continues to cap what would otherwise be even stronger U.S. export volumes. Import activity is also rising, complicating the net trade picture. Imports are increased on both a fat basis and skim-solids basis for 2026 due to increased shipments of butter, fluid milk and cream, and milk proteins. The inbound butter flow is particularly noteworthy given domestic butter prices hovering near $1.57-1.60/lb and amplified cold storage inventory levels. ## 12. NDPSR and NDM Market: Softening Demand, Cautious Buyers The NDM market continued to exhibit a pattern of buyer hesitation that has characterized the second quarter. In the West, low/medium heat nonfat dry milk prices moved lower at both ends of the range and mostly price series in the week of July 13-17. Domestic and international demand signals were mixed. Demand from international buyers is steady, but the broader context suggests fragility. Inventories are manageable, with production largely focused on contracted volumes. One notable tight spot in the powder market involves organic product. Contacts indicate organic dry whole milk is difficult to find on the spot market and trading at a significant premium. This supply squeeze in organic powders contrasts sharply with the oversupply in conventional NDM, illustrating the bifurcation between premium and commodity segments. The July CME NDM close of $1.47 on July 17, followed by slides to $1.45 on July 20 and $1.43 on July 21, represents a material decline that will weigh on NDPSR weighted averages for the week ending July 18 and the week ending July 25. Butter Grade AA under USPHS standards averaged $1.71 per pound for the week ending July 11, 2026. The U.S. price per pound decreased 8.0 cents from the previous week. --- ## Quick Hits - As of July 9, 2026, USDA has reported 19 active cases of New World Screwworm in sheep and cattle in Texas, a secondary livestock disease concern for southern dairy producers to monitor alongside HPAI. - Dry buttermilk prices in the West moved higher at both ends of the range and mostly price series during the week of July 13-17, providing modest support to Class II economics. - The value of New Zealand's milk powder, butter, and cheese exports in May 2026 totaled $2.3 billion, an increase of 6.9 percent year-over-year, reinforcing Oceania's competitive export position. - Classes II and IV demand remains strong, a relative bright spot against the softer Class III/IV powder dynamics seen this week. - Several H5N1 vaccine candidates for dairy cows are currently undergoing USDA-supported field trials, with approval timelines remaining uncertain but industry attention high. - Class III spot milk prices for the week of July 13-17 ranged from $2.00 under to $5.00 over Class, a wide spread reflecting regional milk availability and plant scheduling variation. - The 2026 Calf Facility Tours presented by Professional Dairy Producers (PDP) will provide the opportunity for a behind-the-scenes perspective of three progressive dairy operations and their calf management technologies, an event worth registering for among producers focused on heifer development efficiency. --- ## What to Watch Next Week - **GDT July 21 Results:** Full product-by-product results from the July 21 Global Dairy Trade auction will be the single most important global price signal of the coming week. A fourth consecutive negative auction would accelerate bearish pressure on NDM, butter, and WMP, with direct implications for U.S. export competitiveness. - **CME Cheese Block Recovery:** The block rally to $1.66/lb by Tuesday, July 21, needs follow-through Wednesday through Friday to hold. Watch whether foodservice pull-forward demand ahead of back-to-school ordering carries blocks above $1.67. - **NDM Floor Test:** With CME NDM at $1.43 and falling, the market approaches technical support tested earlier in 2026. Whether buyers step in or continue to delay purchases will set the tone for August NDPSR averages and Class III/IV pricing. - **USDA Cold Storage Report:** The next Cold Storage report will update butter and cheese inventory levels as of July 1, providing critical context for interpreting both the CME moves and import data. Watch the butter figure against the 8% month-over-month gain reported in the July 13-17 USDA Dairy Market News. - **HPAI Idaho Situation:** With 173 confirmed herds, Idaho's outbreak trajectory deserves close monitoring. Any escalation in active new weekly confirmations could signal a new phase of regional spread, with implications for milk component averages and processor input costs in the Pacific Northwest. - **August WASDE Preparations:** The August 12 WASDE will incorporate June milk production actuals from NASS. Given heat stress conditions documented in Pennsylvania, Idaho, and the Central region during this week, there is a credible scenario where per-cow output is revised downward even as the herd count stays elevated. - **Organic NDM Availability:** The tight organic dry whole milk spot market flagged this week by USDA Dairy Market News contacts bears watching. If organic milk production growth continues to lag conventional expansion, premium powder premiums could widen further. --- *The Therio Dairy Newsdesk publishes weekly U.S. dairy industry roundups covering commodity markets, USDA reports, disease surveillance, trade, and producer economics. Our goal is to provide data-forward, analyst-quality coverage for dairy producers, cooperatives, processors, and allied industry professionals. Prices, data, and forecasts cited reflect publicly available government and market sources as of the publication date. Nothing in this roundup constitutes financial or risk management advice.*