U.S. milk production remained abundant in July, topping strong output a year ago, which was up 4.2 percent from July 2024. The USDA’s latest data reported output at 20.1 billion pounds, up 2.2 percent from July 2025, and follows a 3.0 percent rise in June. The 24-state total came in at 19.4 billion pounds, up 2.3 percent.

StoneX says output was stronger than anticipated and the higher fat and protein in the milk puts component adjusted production up 3.5 percent from July 2025.

June output in the 50 states was revised up 124 million pounds to 19.8 billion, up 3.0 percent from a year ago, instead of the 2.3 percent originally announced. The 24-state total was revised up to 19.1 billion, up 3.1 percent instead of the 2.4 percent reported.

July cow numbers totaled 9.710 million, unchanged from the June count, which was revised up a whopping 33,000 head. The herd was up 199,000 or 2.1 percent from a year ago, making it the largest in over 30 years. The 24-state count, at 9.267 million, was up 2,000 from June’s total which was revised up 34,000 head, and up 185,000 or 2.0 percent from a year ago.

July milk per cow averaged 2,075 pounds in the 50 states, up just 3 pounds or 0.1 percent from a year ago, as hot weather and wildfire smoke put stress on cows. The 24-state average, at 2,093 pounds, was up 5 pounds or 0.2 percent from 2025. The June average was revised up 6 pounds in both.

HighGround Dairy stated that milk output exceeded 2 percent for the 15th consecutive month and was not expected to be as strong as it was, considering the hot weather that was experienced.

USDA’s latest weekly slaughter report showed 52,900 dairy cows sent to slaughter the week ending Aug. 8, up 1,800 or 3.5 percent from a year ago. Year to date, 1,651,600 head had been culled, up 69,100 or 4.4 percent from a year ago.

President Donald Trump announced that 664 million pounds of ground beef could be imported into the U.S. over the next 90 days and would be sold at a 25 percent discount to current prices. Beef imports are not off to a good start as over 29,000 pounds of beef imported from Argentina was recalled in early August because it skipped USDA mandatory inspection.

HighGround Dairy stated the 664 million pounds Trump announced amounts to about 7 percent of the annual total eaten by American consumers, “So it is not insignificant. While the measure should take some pressure off consumers, it seems like prices will drift higher again as this beef is imported, purchased, and eaten. U.S. beef producers have expressed dissatisfaction with the policy and concern that it will do little to rebuild the beef herd while limiting their income after years of drought and negative margins.”

The National Milk Producers Federation warned that “Beef imports will have unintended consequences for U.S. cattle and dairy producers.” A NMPF press release stated “Cull cow and calf sales are a key economic driver for U.S. dairy farmers and equates to 20 percent of annual dairy farm income and greater than 20 percent of the U.S. beef production is now being supplied by dairy farms. Current beef prices are an important reason why we have the most dairy cows in the U.S. since 1992. Policy-created disruption threatens the billions of dollars invested by U.S. dairy farmers and manufacturers to grow supply of beef and dairy products.”

NMPF says “Removing the tariff isn’t likely to lower consumer prices, as the price of this imported product is already well below that of the comparable domestically produced product derived from U.S. cull dairy and beef cows, but it will certainly improve the profit margin for the exporter.

“The more consequential impact will be a delay in the necessary economic signal sent to U.S. beef producers to increase production, which may reduce domestic supplies in the longer term,” says NMPF.

Meanwhile, beef imports from Mexico are resuming following the shutdown due to concerns over the outbreak of Screwworm there.

July butter stocks were down from June and a year ago, according to the Agriculture Department’s latest Cold Storage report. July 31 butter holdings fell to 321.4 million pounds, down 10.5 million pounds or 3.2 percent from June, and 10.1 million or 3.0 percent below July 2025. June’s total was revised down 157,000 pounds.

American type cheese stocks fell to 811.5 million pounds, down 11.3 million or 1.4 percent from the June level, and down 2.0 million or 0.2 percent from a year ago.

The “other” cheese inventory climbed to 598.0 million pounds, up 9.8 million or 1.7 percent from June, and up 5.0 million or 0.8 percent from a year ago. The June total was revised up 2.0 million pounds.

Cheese stocks totaled 1.433 billion pounds, unchanged from June, but up 5.0 million or 0.4 percent from a year ago. Revisions added 2.4 million pounds to the June total. The Aug. 24 Daily Dairy Report stated that data reflected summer slowdowns in milk and dairy product output.

StoneX stated “July Cheese Stocks/Use justified a price closer to $1.80 per pound versus the $1.60 we were trading at. At these current levels and with a higher EU cheese market, one could argue for a renewed export bid but that has yet to materialize and the market still seems more worried about further milk production growth for now but the risk for more export demand remains relevant.

StoneX adds “The stocks/use for third quarter butter would support levels closer to $2 but the trend this year still has it deviating well away from that.”

Fluid milk sales jumped in June Dairy Month. The USDA’s latest data showed packaged sales at 3.3 billion pounds, up 3.3 percent from June 2025, and follows a 2.1 percent drop in May. Conventional product sales came in at 3.1 billion pounds, up 3.2 percent from a year ago. Organic sales, at 239 million, were up 3.4 percent from a year ago, and represented a typical 7.2 percent of total milk sales in the month.

Whole milk sales totaled 1.3 billion pounds, up 7.0 percent from a year ago, and up 3.1 percent for the six-month period. Whole milk represented 39.1 percent of total sales for the month.

Skim milk sales, at 125 million pounds, were down 21.5 percent from a year ago and down 11.1 percent year to date.

Packaged fluid sales, January to June, totaled 21.1 billion pounds, up 0.1 percent from 2025. Conventional product sales totaled 19.6 billion pounds, up 0.1 percent from a year ago. Organic products, at 1.5 billion pounds, were down 0.3 percent, and represented 7.1 percent of total milk sales for the year so far.

CME block Cheddar was trading Thursday at $1.4950 per pound, lowest price since July 6, and 28 cents below a year ago. It closed Friday at $1.5275.  The barrels were at $1.5750 Thursday, 20.50 cents below a year ago, following a Friday finish at $1.5650.

Mild August temperatures in the Central region have supported steadier milk flows and contacts tell Dairy Market News that cooler conditions have helped strengthen overall production.