Dairy Industry News Roundup: Week of October 17 - 23, 2026

# Dairy Industry News Roundup: Week of October 17 - 23, 2026 Cheese blocks surged more than 19 cents per pound on the CME in the week of October 19 through 23, reaching $1.7394 as a four-day average, while the Global Dairy Trade (GDT) price index posted a 2.5% gain at Event 414 on October 20 on the back of Chinese buying in WMP and SMP, even as the H5N1 story in dairy cattle took a new turn with a confirmed human case in Yakima County, Washington. Meanwhile, the October WASDE pegged 2026 U.S. milk output at 236.9 billion pounds, and FMMO data showed the October base Class I price rising $1.84 per hundredweight to $18.88. --- ## 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 Markets: Cheese Blocks Stage Sharpest Weekly Rally in Months The week of October 19 to 23 brought a dramatic reversal in CME spot cheese prices after a weeks-long slide had pushed blocks to multi-year lows in early October. On Wednesday, October 21, CME cash cheese data showed cheddar blocks at $1.7025, down $0.0975 on the session, while cheddar barrels held at $1.7200 with no change, butter fell to $1.3300, dry whey dropped to $0.8425, and NFDM eased to $2.1350. Despite Wednesday's pullback, the week's overall trajectory was sharply higher. The four-day average for cheddar blocks through Thursday, October 22, reached $1.7394 per pound, versus a prior week average of $1.5395, while cheddar barrels averaged $1.7000 against a $1.5095 prior week average. Butter averaged $1.3513 for the week through Thursday, versus $1.3110 the prior week. NDM Grade A averaged $2.1700 for the week through Thursday, compared with $2.2105 the prior week. | Product | Mon 10/19 | Tue 10/20 | Wed 10/21 | Thu 10/22 | 4-Day Avg | Prior Wk Avg | |---|---|---|---|---|---|---| | Cheddar Block ($/lb) | 1.7300 | 1.8000 | 1.7025 | 1.7250 | 1.7394 | 1.5395 | | Cheddar Barrel ($/lb) | 1.6400 | 1.7200 | 1.7200 | 1.7200 | 1.7000 | 1.5095 | | Butter ($/lb) | 1.3850 | 1.3600 | 1.3300 | 1.3300 | 1.3513 | 1.3110 | | NDM Grade A ($/lb) | 2.2000 | 2.2100 | 2.1350 | 2.1350 | 2.1700 | 2.2105 | The prior week (October 12 to 16) had already posted sharp gains. On Friday, October 16, barrels closed at $1.6200 and 40-pound blocks at $1.6825, capping a week that saw blocks move from $1.3900 on Monday to $1.6825 by Friday, an intra-week gain of nearly 29 cents. The back-to-back weekly rallies represent the most sustained upward momentum in the cheddar block market since mid-summer. ## 3. Futures Markets Signal More Upside, But Class III Lags Spot CME futures markets reflected some of the spot optimism but pricing across the November and December strips remained cautious. Thursday's November futures settlements showed Class III at $17.67 per hundredweight, Class IV at $21.00 per hundredweight, cheese at $1.6620 per pound, dry whey at $0.7575 per pound, NDM at $2.0500 per pound, and butter at $1.3900 per pound. The Thursday prints reflected a significant single-session pop, standing well above Monday through Wednesday settlement values, suggesting late-week positioning ahead of a Friday with no settlement data in the table. Feed cost futures through Thursday showed December 2027 corn at $5.1150 per bushel, November 2026 soybeans at $12.5350 per bushel, and November 2027 soybeans at $12.2825 per bushel. The corn and soybean complex remained broadly stable through the week, with no major shift in the feed cost outlook for dairy producers. | Contract | Mon | Tue | Wed | Thu | |---|---|---|---|---| | Class III Nov ($/cwt) | 15.35 | 15.37 | 15.21 | 17.67 | | Class IV Nov ($/cwt) | 20.39 | 20.39 | 20.39 | 21.00 | | Cheese Nov ($/lb) | 1.4510 | 1.4550 | 1.4480 | 1.6620 | | NDM Nov ($/lb) | 2.0003 | 2.0003 | 2.0003 | 2.0500 | | Butter Nov ($/lb) | 1.3550 | 1.3550 | 1.3550 | 1.3900 | | Dry Whey Nov ($/lb) | 0.7303 | 0.7300 | 0.7303 | 0.7575 | | Corn Dec 2027 ($/bu) | 5.1775 | 5.1675 | 5.1525 | 5.1150 | | Soybeans Nov 2026 ($/bu) | 12.5300 | 12.3750 | 12.4625 | 12.5350 | ## 4. October WASDE Trims Milk Output Forecast, Mixed Price Signals USDA's October WASDE decreased the 2026 milk production forecast slightly to 236.9 billion pounds on lower cow inventories and milk output per cow. The October 9 report, designated WASDE-676, carried broadly mixed signals for dairy price forecasters. The milk production forecast was decreased slightly for both 2026 and 2027. For both years, butter and cheese price forecasts were decreased based on recent prices and growth in butterfat production. The NDM and whey price forecasts were raised to reflect recent prices and strong demand for protein products. For both 2026 and 2027, the Class III price forecast was lowered as higher whey prices only partially offset lower cheese prices, and the Class IV price forecast was raised as higher NDM prices more than fully offset lower butter. The USDA ERS Livestock, Dairy, and Poultry Outlook for October 2026, released October 16, provided companion analysis. The report, authored by Russell Knight, Hannah Brooks (Taylor), Adriana Valcu-Lisman, Angel Teran, Mildred Haley, Grace Grossen, and Brian Williams, analyzes the economic impacts of month-to-month changes in USDA's WASDE report on domestic and international markets for beef, pork, poultry, eggs, and dairy products. ## 5. FMMO Advanced Prices: October Base Class I at $18.88 per Hundredweight Federal Milk Marketing Order advanced pricing data for October 2026 showed a meaningful improvement in the fluid milk baseline. The base Class I price was $18.88 per hundredweight for October 2026, with the base skim milk price for Class I at $14.12 per hundredweight, the Class I ESL adjustment at negative $0.46 per hundredweight, the advanced Class III skim milk pricing factor at $11.18 per hundredweight, the advanced Class IV skim milk pricing factor at $14.12 per hundredweight, the advanced butterfat pricing factor at $1.5024 per pound, the Class II skim milk price at $14.82 per hundredweight, and the Class II nonfat solids price at $1.5935 per pound. The base Class I price per hundredweight increased $1.84 from the previous month. The base skim milk price for Class I was $14.12 per hundredweight for October 2026, increasing $1.96 from the prior month. | FMMO Factor | October 2026 | Change vs September | |---|---|---| | Base Class I Price ($/cwt) | $18.88 | +$1.84 | | Base Skim Milk Price for Class I ($/cwt) | $14.12 | +$1.96 | | Class I ESL Adjustment ($/cwt) | ($0.46) | -$1.27 | | Advanced Class III Skim Milk Pricing Factor ($/cwt) | $11.18 | n/a | | Advanced Class IV Skim Milk Pricing Factor ($/cwt) | $14.12 | n/a | | Advanced Butterfat Pricing Factor ($/lb) | $1.5024 | n/a | | Class II Skim Milk Price ($/cwt) | $14.82 | n/a | | Class II Nonfat Solids Price ($/lb) | $1.5935 | n/a | ## 6. NDPSR: Butter and Blocks Down for Week Ending October 10 The most recent National Dairy Products Sales Report (NDPSR), published October 15 and covering the week ending October 10, captured market conditions before the subsequent block cheese surge. Butter prices received for 25-kilogram and 68-pound boxes meeting USDA Grade AA standards averaged $1.36 per pound for the week ending October 10, 2026, a decrease of 1.0 cent from the previous week. Cheddar cheese prices received for 40-pound blocks averaged $1.43 per pound for the week ending October 10, 2026, a decrease of 2.7 cents from the previous week. Dry whey prices received for bag, tote, and tanker sales meeting USDA Extra Grade standards averaged 72.0 cents per pound for the week ending October 10, 2026, an increase of 3.8 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 $1.97 per pound for the week ending October 10, 2026. | Product | Wk Ending 10/10/26 | Change vs Prior Wk | |---|---|---| | Butter Grade AA ($/lb) | $1.36 | -$0.010 | | Cheddar 40-lb Block ($/lb) | $1.43 | -$0.027 | | Dry Whey Extra Grade ($/lb) | $0.720 | +$0.038 | | NDM Grade A/Extra Grade ($/lb) | $1.97 | n/a | ## 7. GDT Event 414: Powder Rally Lifts Index 2.5%, Cheddar Slides 7.4% The October 20 GDT auction (Event 414) delivered the biggest price index gain since February 2026, driven almost entirely by Chinese demand for milk powder products even as cheese and fats struggled globally. The GDT price index rose 2.5% at Event 414, held on October 20, 2026. A total of 42,088 metric tons were sold at an average winning price of $4,021 per metric ton, in an auction with 145 participating bidders. Rising prices for milk powder across three types and six delivery periods boosted the GDT price index by 2.5%, the biggest rise since last February. Whole milk powder jumped 4.4%, skim milk powder gained 3.4%, and buttermilk powder was up 8.4%. NZX Dairy Insights said strong buying from China was behind the milk powder price increases, with just over half of the volume going that way, especially in the near-term contract periods. In the cheese complex, cheddar's average winning price was $3,645 per metric ton ($1.65 per pound), down 7.4%. Anhydrous milk fat lost 3.4% of its value, trading at $5,488 per metric ton, while butter declined 0.4% to $4,721 per metric ton. The global demand for whey protein is also generating more cheese products, and GDT cheddar prices plummeted as inventories and export volumes grow. | GDT Product | Avg Price ($/MT) | Change vs Prior GDT | |---|---|---| | Whole Milk Powder | $3,760 | +4.4% | | Skim Milk Powder | $3,975 | +3.4% | | Buttermilk Powder | $4,694 | +8.4% | | Mozzarella | $3,880 | +1.3% | | Cheddar | $3,645 | -7.4% | | Butter | $4,721 | -0.4% | | Anhydrous Milkfat | $5,488 | -3.4% | | Lactose | $1,665 | +0.6% | This was the second straight increase in the GDT price index. The prior GDT auction on October 8 (Event 413) had shown a +1.2% gain, with the index rising in five of the last six semi-monthly auctions. The October 6 summary showed a GDT price index increase of 1.2% from the previous event, with the weighted average price at $3,928 per metric ton and 41,692 metric tons sold, mostly WMP and SMP. ## 8. H5N1 in Dairy: Washington State's First Detections Followed by Human Case The H5N1 HPAI outbreak in U.S. dairy cattle claimed significant new ground during the week, as the fallout from Washington State's first-ever detections in dairy cattle expanded. The Washington State Department of Agriculture and USDA's National Veterinary Services Laboratories confirmed HPAI H5N1 on two Yakima County dairy farms on October 8, the first known detection in cattle in the state. The affected herds had tested negative in routine surveillance and were tested after showing clinical signs. Both farms are under quarantine. The disease event escalated sharply during this week when a human case was announced. A dairy worker in central Washington State tested positive for avian influenza after exposure to infected cattle, one week after the state confirmed HPAI H5N1 in dairy cows for the first time. The Yakima Health District, working with the Washington State Department of Health, announced the confirmed human case on October 15, 2026. The person has not had severe illness or has not been hospitalized and is isolating at home. USDA is tracking active circulation across 19 states since the outbreak began in 2024. Dairy infections continued during 2026. In September, APHIS data showed additional affected herds in Idaho and Texas, and by that point 88 dairy-herd detections had been reported during 2026. USDA continues its National Milk Testing Strategy (NMTS) to identify affected states and herds through dairy-processing-plant silo monitoring, state surveillance, outbreak investigations, and testing associated with interstate movement. The program is explicitly intended not simply to detect infection, but to identify where virus is circulating and support interventions intended to reduce transmission between livestock operations. ## 9. NMTS and Interstate Movement Policy Background The week's H5N1 news came against the backdrop of an updated APHIS policy on interstate cattle movement that took effect in late April 2026. USDA-APHIS had issued updated guidance related to the April 2024 federal order that required testing of lactating dairy cattle before they move across state lines. Effective immediately as of April 27, 2026, lactating dairy cattle moving interstate from states with Unaffected State Status under the National Milk Testing Strategy are no longer required to be tested for HPAI H5N1 prior to movement. No testing is required for lactating dairy cattle originating from states with Unaffected State Status under the NMTS. Unaffected State Status requires ongoing testing and surveillance activities to confirm the absence of HPAI in the state's dairy herds. Washington State's new detections complicate that framework, as the state now joins the list of affected states and would no longer qualify for the streamlined movement rules. APHIS notes that detection of HPAI H5N1 in lactating dairy cattle does not pose a risk to consumer health or compromise the safety of the commercial milk supply. Pasteurization effectively inactivates the HPAI virus. Milk from affected animals is diverted or destroyed to prevent entry into the food supply. ## 10. Milk Supply and Regional Conditions Regional milk supply dynamics entering the week of October 17 were shaped by seasonal cooling trends in the Central region and persistent tightness in the Southwest. Milk supply was strengthening across the Central region as cooler weather moved into the area. Contacts reported that forecasted lower temperatures support improved milk output and increased overall milk availability. Despite the improvement in milk supplies, spot load availability remained limited as Class I and Class IV manufacturing continued to draw milk away from Class III processing. Reported Class III spot milk prices ranged from flat-class to $3.00-over Class. Elevated temperatures persisted throughout much of the Southwest, and milk supplies remained tight. In the Northeast, conditions were the opposite. Supplies were heavy in the Northeast, and milk production was strengthening in the Central and West regions. Class I demand remained very good in the East and was steady in the West. On the butter side, inventories of 80-percent butterfat butter remained ample, while availability of 82-percent butterfat butter remained tight. Grade AA butter prices remained flat relative to CME market levels. Cheddar production was steady, inventories were ample, and strong demand for mozzarella and parmesan was keeping some stocks light. In the West, cheese supplies remained abundant and the market tone was unchanged, as manufacturers maintained full production schedules to benefit from whey production returns. ## 11. Protein Complex Leads the Dairy Income Story Dry whey and NDM continued to be the standout performers in the U.S. dairy product complex through the October reporting period. Strong demand for proteins was lifting powder values. CME spot whey powder gained another 2 cents and reached 82.5 cents per pound, a fresh 4.5-year high. Spot nonfat dry milk added a nickel, climbing to $2.22, just 7.5 cents below the all-time high reached in spring 2026. Asian buyers were eager to import U.S. whey powder, propping up prices despite robust production. For NDM, both domestic and international demand were strong, while production remained restrained. Other dairy processors were lapping up much of the milk supply, spot milk prices were rising, and dryers were running light in the Southwest. This dynamic created a two-tier market environment in which producers supplying Class IV plants were outperforming those supplying Class III cheese plants by a historically wide margin. Low and medium heat NDM prices increased at both ends of the range and across the mostly series in the Central and East regions. In the West, prices remained steady at the lower end of the range but increased at the top. ## 12. Global Supply Context: GDT Trend and European Pressure The October 20 GDT results land within a broader global supply context that remains important for U.S. exporters to understand. The prior GDT event (October 8) had already signaled improving protein sentiment. The price index on the October 8 GDT increased 1.2% from the previous auction, held three weeks ago. The GDT price index had now increased in five of the last six semi-monthly auctions. Skim milk powder averaged $3,847 per metric ton ($1.74 per pound), up 4.3%. Whole milk powder's average winning price was $3,605 per metric ton ($1.63 per pound), up 1.2%. In Great Britain, the supply picture offered a contrasting backdrop. GB milk supplies kept contracting through the third quarter of 2026. The October forecast update puts GB milk production for the 2026/27 season at 12.73 billion litres, 2.2% below the previous milk year. The review attributes the pressure to low forage stocks, higher production costs across fuel, fertiliser, forage, straw and labour, and increased bluetongue virus risk. Tighter European supply is a structural support for global protein prices that benefits U.S. NDM and whey exporters. On the cooperative consolidation front in Europe, the earlier confirmation of the merger between Arla and DMK to form a larger co-op was noteworthy. The new entity will process around 19 billion litres of milk and will have a turnover of just under 20 billion euros. Last week, the European Commission gave the go-ahead for the merger. The Arla-DMK combination will create one of the world's largest dairy processors and is expected to have competitive implications for U.S. cheese and powder exporters targeting EU-adjacent markets. --- ## Quick Hits - EEX October 2026 European futures settled with SMP at 3,440 euros per metric ton and butter at 4,600 euros per metric ton on October 22. - The FMMO Fall 2026 Meeting is scheduled for October 27 through 29 to take place virtually. - GDT Event 414 on October 20 saw 145 bidders participate, with 105 winning bidders emerging over 17 bidding rounds lasting two hours and 45 minutes. - NZ milk production data released hours ahead of GDT Event 414 showed a 1.9% rise in milksolids and a new record for September collections, according to NZX analyst Rosalind Crickett. - The base Class I price for October 2026 was $18.88 per hundredweight, an increase of $1.84 per hundredweight when compared to September 2026. - USDA notes that H5N1 detections tend to increase during fall and spring migration seasons and emphasizes the importance of examining the preceding 30 days rather than relying solely on cumulative numbers from the multi-year outbreak. - As of the October 6 GDT event, SMP, WMP, and all products had recovered a little while butter continued on a downward trend globally. --- ## What to Watch Next Week - **FMMO Virtual Meeting (Oct 27 to 29):** The FMMO Fall 2026 Meeting takes place virtually starting Monday. Federal order administrative matters, pricing formula discussions, and handler/producer input will all be in focus. Any signal on structural formula changes deserves close attention. - **November WASDE (Nov 10):** The next USDA WASDE release is scheduled for November 10. Analysts will be watching whether USDA revises the 2026 milk output forecast further downward and how the cheese and NDM price forecasts track against the dramatic CME price moves seen this week. - **CME Cheese Block Follow-Through:** Blocks ended the week around $1.72 to $1.80. Whether Tuesday's high of $1.8000 holds as a ceiling or acts as a launching point depends heavily on cold storage inventory reports and export demand signals from buyers who were already described as fully stocked at lower prices. - **Washington State H5N1 Trajectory:** With two Yakima County herds confirmed positive and a human case announced October 15, all eyes are on whether APHIS NVSL sequencing identifies additional spread in Washington's significant dairy corridor. A third farm detection would draw intensified federal response. - **GDT Event 415 (Tentative Nov 4):** Following the 2.5% gain at Event 414, the next GDT auction will test whether Chinese WMP and SMP buying sustains or whether near-term contract demand softens after aggressive procurement this week. - **NDPSR for Week Ending October 17:** The next National Dairy Products Sales Report will be the first to capture some of the block cheese rally, offering a spot check on whether physical trade prices tracked the CME surge or lagged behind. - **Dry Whey Near Multi-Year Highs:** CME spot dry whey reached 84.25 cents per pound mid-week before settling back. Asian buyer activity and domestic SMP/WPC competition for milk solids will determine whether the 4.5-year high is challenged or fades. --- *The Therio Dairy Newsdesk publishes weekly U.S. and global dairy market intelligence for producers, cooperatives, processors, traders, and allied industry. Our coverage draws on USDA AMS, NASS, ERS, and APHIS data streams alongside CME cash and futures markets, GDT auction results, and international dairy reporting. For questions, corrections, or to contribute a story tip, contact the Therio editorial team.*