U.S. milk tanks are filling up and output surpassed year ago levels for the fourth month in a row in April. The USDA’s preliminary data in its latest Milk Production report shows output at 19.37 billion pounds, up 1.5 percent from April 2024, biggest increase since August 2022. The 24-state production, at 18.6 billion, was up 1.6 percent. The March totals were both revised up 26 million pounds.

StoneX points out that fat and protein content in the milk were up from last year, which put component adjusted production up 3.0 percent.

April cow numbers totaled 9.425 million, up 5,000 head from March and 89,000 or 1.0 percent more than a year ago. The March count was revised up 16,000 head. The 24-state count, at 8.983 million, was up 7,000 from March and 93,000 or 1.0 percent above a year ago. The March count was revised up by 12,000 head.

April output per cow in the 50 states averaged 2,055 pounds, up 11 pounds or 0.5 percent from a year ago, and up 12 pounds or 0.6 percent in the 24-state data.

StoneX broker Dave Kurzawski said in the May 26 Dairy Radio Now broadcast “Tis the time of year for milk output to increase. It’s the spring flush and we’re probably at the peak right now.”

When asked if this size of an increase, considering the new cheese capacity that has come online, wasn’t a concern for the market, he answered, “I think we overestimated how quickly those cheese plants would be up and running. That slower start makes sense because it takes time to put a cheese plant together.”

He said we can make milk. When you get into the summer months, you don’t know what the weather is going to do and how that will impact production, but he suspects that milk is “in balance.” 

“We’re not awash in milk anywhere, we’re not dumping milk, we’re more or less in balance even with a 1.5 percent increase.” Added to that are the strong U.S. exports. He believes they will continue until prices narrow between the U.S. and the rest of the world.

China’s April dairy imports looked stronger, according to the latest China Customs Statistics. Cheese imports totaled 37.6 million pounds, up 6.2 percent from April 2024.

HighGround Dairy points out, “They moved counter-seasonally higher from March and stretched to a record high for the month of April. New Zealand’s market share jumped to an impressive 66.5 percent as imports from the country increased 36 percent from prior year. Australia was the second largest supplier at 16 percent.” The U.S. share was down, as was that of Italy, France, the Netherlands and Denmark.

Skim milk powder (SMP) imports totaled 60.5 million pounds, up 27.4 percent, as volumes continued to recover versus 2024, says HighGround, most notably from New Zealand. HGD adds that North Asia was a dominant buyer of SMP in Tuesdays GDT, “reinforcing that demand remains solid in the region.”

Whey product imports, at 122.3 million pounds, were up 13.9 percent, and were up 31.3 percent year to date.

The May 20 Daily Dairy Report says, “China’s imports of whey remained strong in April, as merchants rushed to receive shipments ahead of “liberation day” tariffs. Any product that left a U.S. port by April 9 and arrived in China by May 13 did not face the sharply higher border tax. The US accounted for 45 percent of China’s whey product imports last month, and the country’s total whey imports were 13.9 percent greater than in April 2024.”

Butter imports amounted to just 16 million pounds, down 21.9 percent from a year ago, although YTD imports were up 25.1 percent from 2024.

China’s infant formula imports continued to recover, according to HGD, up 18.4 percent, “Showing solid improvement from a weak 2024. While the Netherlands maintained the largest market share, it ceded some ground to both New Zealand and Germany, though imports from all three countries rose year over year. This rebound aligns with evolving parenting behaviors: children’s health products were the second-fastest growing consumer health category in China over the five years leading up to 2023, and that trend is expected to continue,” says HGD.

Dave Kurzawski said, “China has been buying underwhelming amounts the past few years and they’ve built up their industry significantly but they’re still going to be a buyer.”

The USDA announced the June Federal order Class I base milk price at $17.26 per hundredweight, down $1.11 from May, and $2.82 below June 2024. It equates to $1.48 per gallon, down from $1.73 a year ago. The six-month Class I average stands at $19.65, down from $18.83 a year ago and compares to $19.77 in 2023.

Cash Cheddar block cheese was trading Thursday morning at $1.9475 per pound, highest since Oct. 7, 2024, following its Friday close at $1.93. The barrels hit $1.87 Thursday, 7.75 cents below the blocks, after finishing Friday at $1.88.

Central region retail cheese sales are steady to stronger, according to Dairy Market News. Food service demand is steady. Milk output is steady in the upper Midwest but declining in the southern part. Cheesemakers are running busy schedules as some prepared for down time this weekend. Milk at mid-week was moving as low as $7-under. Cheesemakers with scheduled down time for the upcoming holiday were either not buying additional loads this week or selling milk ahead of the long weekend.

Some Western cheese manufacturers reported milk availability was looser with Class I demand generally lightening due to spring recesses beginning or fast approaching at educational institutions.

Cheese production was mixed as was availability. In some cases, inventories were tight regardless of variety. Domestic retail and food service demand is stronger but food service is less robust. Demand from international buyers is stronger, says DMN.

CME butter was unchanged the first three days this week but added 2 cents Thursday, hitting $2.3625 per pound, highest since March 27, with 24 loads exchanging hands on the day. The butter closed Friday at $2.3425.

Central milk output is steady to lighter and upper Midwest cool temperatures are keeping milk components high, leaving plenty of cream available. Ice cream makers are drawing more on available cream, though plenty is available for churning. Some plants scheduled down time during the upcoming holiday weekend, reducing cream demand. Churns are active, as processors work to build inventory for use later in the year. Some plants are increasing 82 percent fat butter production amid increasing export demand. Domestic demand is steady.

Milk production continues to provide plenty of cream for Western manufacturers however cream prices increased in May as milk output decreased week-over-week for some parts of the region. Churning varies from strong to lighter as the holiday weekend neared. Manufacturer inventories are generally increasing. Domestic demand is steady or somewhat stronger and it’s anticipated that the holiday weekend will positively contribute to food service demand, which is less robust than retail demand. International demand is strong, says DMN.

Grade A nonfat dry milk was trading Thursday at $1.23 per pound, following a close Friday at $1.2250. Dry whey slipped to 52.50 cents per pound Tuesday but rallied and climbed back to 54.25 cents per pound Thursday morning.