USDA Announces $148 Million in Dairy Purchases as Part of $263 Million Food Buy

## USDA Commits $148 Million to Dairy in Largest Section 32 Purchase of 2026 U.S. Secretary of Agriculture Brooke L. Rollins announced on February 19, 2026, that the USDA will purchase up to $263 million in agricultural products from American farmers and producers. Of that total, $148 million, roughly 56%, is dedicated to dairy products, making this the largest dairy-focused Section 32 purchase so far in 2026. The purchases will be distributed to food banks and nutrition assistance programs nationwide through The Emergency Food Assistance Program (TEFAP). ## Dairy Purchase Breakdown The dairy portion of the announcement includes five categories of products: - **Butter**: $75 million - **Cheddar Cheese and Cheese Products**: $32.5 million - **Swiss Cheese**: $10 million - **Fresh Fluid Milk**: $20.5 million - **Ultra-High Temperature (UHT) Milk**: $10 million Butter alone accounts for nearly 29% of the entire $263 million purchase, signaling strong federal interest in supporting butter producers and maintaining price stability in that market segment. ## Beyond Dairy: Full Commodity List The remaining $115 million covers legumes, fruits, and tree nuts: - **Dried Beans (Black and Pinto)**: $25 million - **Split Peas**: $24 million - **Fresh Pears**: $15 million - **Walnuts**: $15 million - **Lentils**: $14 million - **Chickpeas**: $12 million - **Pecans**: $10 million ## What Is Section 32? Section 32 of the Agriculture Act of 1935 is a mandatory appropriation funded by 30% of customs receipts from the prior calendar year. It allows the USDA to purchase surplus agricultural commodities and distribute them through federal nutrition programs. These purchases serve a dual purpose: they help stabilize producer prices by removing surplus from commercial markets, and they deliver nutritious food to Americans who depend on food banks and other assistance programs. "From milk and dairy to fruits, legumes, and tree nuts, these staples are essential for feeding families and sustaining America's agricultural economy," Secretary Rollins said in the announcement. "Through these Section 32 purchases, USDA is delivering wholesome, real food to Americans while injecting critical dollars into local economies." ## Builds on January's $80 Million Specialty Crop Purchase Today's announcement follows a January 13, 2026 Section 32 purchase of $80 million in specialty crops (almonds, grape juice, pistachios, and raisins at $20 million each), which Secretary Rollins announced at the 107th American Farm Bureau Federation Convention in Anaheim, California. At that same convention, Rollins also announced expanded enrollment for the 2026 Dairy Margin Coverage (DMC) program, which opened January 12 and closes February 26, 2026. The One Big Beautiful Bill Act (OBBBA), signed by President Trump on July 4, 2025, reauthorized DMC through 2031 and increased Tier 1 coverage from 5 million to 6 million pounds of milk per operation. Combined, the two Section 32 announcements bring total 2026 commodity purchases to $343 million. ## Current Dairy Market Context The timing of this purchase comes amid a shifting dairy market landscape. According to the USDA's February 2026 Livestock, Dairy, and Poultry Outlook: - **Milk production** is forecast at 234.5 billion pounds for 2026, up 1.3% from 2025 - **The dairy cow herd** stands at an estimated 9.54 million head, down 15,000 from the prior month's estimate - **Milk per cow** is projected at 24,585 pounds annually, with productivity gains offsetting smaller herd sizes - **Butter prices** are forecast to average $1.68/lb in 2026, up $0.07 from the January forecast - **Cheese prices** are forecast to average $1.605/lb, up $0.02 - **All-milk price** is projected at $18.95/cwt, up $0.70 from the prior forecast but well below 2025's $21.15/cwt average USDA economists note that replacement heifer inventories remain tight at 3.905 million head (40.8% of productive cows), and strong beef prices continue to incentivize culling of lower-producing dairy cows. These supply constraints, combined with firm domestic and export demand, support the rationale for government dairy purchases. ## What It Means for Dairy Producers For dairy farmers, the $148 million in purchases provides direct market support by absorbing surplus product and maintaining price floors. The butter allocation alone ($75 million) is significant, as butter inventories and pricing have been closely watched by the industry. The purchases also reinforce the federal government's commitment to using dairy products, rather than processed alternatives, in nutrition assistance programs, a priority that aligns with the USDA's "Make America Healthy Again" messaging around the recently released Dietary Guidelines for Americans 2025-2030. Dairy producers interested in the Dairy Margin Coverage program should note the enrollment deadline of February 26, 2026. More information is available at the [USDA FSA DMC webpage](https://www.fsa.usda.gov/resources/programs/dairy-margin-coverage-program-dmc) or through local USDA Service Centers. ## Sources - [USDA Press Release: Secretary Rollins Announces $263 Million Food Purchase](https://www.usda.gov/about-usda/news/press-releases/2026/02/19/secretary-rollins-announces-263-million-food-purchase-support-us-producers-and-strengthen-americas) (February 19, 2026) - [USDA Press Release: Secretary Rollins Announces DMC Expansion and Section 32 Purchases at Farm Bureau Convention](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) (January 13, 2026) - [USDA ERS Livestock, Dairy, and Poultry Outlook: February 2026](https://www.ers.usda.gov/publications/pub-details?pubid=113843) - [USDA AMS Dairy Market News Weekly Report](https://www.ams.usda.gov/mnreports/dywweeklyreport.pdf)