November milk was up a hefty 4.5 percent from a year ago. Milk components were also up, and USDA’s latest Dairy Products report shows how the milk was used.

Cheese output totaled 1.218 billion pounds, down 3.4 percent from October, but up 5.9 percent from November 2024. Output in the 11 months amounted to 13.4 billion pounds, up 2.5 percent from 2024.

Mozzarella production totaled 415.2 million pounds, up 7.2 percent from a year ago, with year-to-date (YTD) output hitting 4.5 billion pounds, up 2.5 percent from 2024.

American cheese, at 474 million pounds, was down 3.7 percent from October, but up 5.6 percent from a year ago. YTD American hit 5.3 billion pounds, up 3.7 percent.

Italian style cheeses totaled 526.2 million pounds, down 2.7 percent from October, but up 6.8 percent from a year ago, with YTD at 5.7 billion pounds, up 3.3 percent.

Cheddar output, the cheese traded at the CME, slipped to 322.7 million pounds, down 5.6 million or 1.7 percent from October’s level which was revised down 1.3 million pounds from last month’s report. It was up a whopping 14.4 million or 4.7 percent from a year ago. YTD Cheddar stood at 3.6 billion pounds, up 4.9 percent from 2024.

Butter output fell to 179.8 million pounds, down 6.4 million pounds or 3.4 percent from October, but was up 3.8 million or 2.2 percent from a year ago. YTD output hit 2.2 billion pounds, up a market-hurting 6.2 percent from a year ago.

Yogurt production totaled 415.8 million pounds, up 8.3 percent from a year ago, with output for the year standing at 4.8 billion pounds, up 7.7 percent.

Hard ice cream, at 49.8 million pounds, was down 2 percent from 2024. YTD production reached 671.6 million pounds, down 1.9 percent from a year ago.

Dry whey production slipped to 64.8 million pounds, down 3.1 million pounds or 4.5 percent from October, but was virtually unchanged from a year ago. YTD whey output hit 759.6 million pounds, down 3.2 percent from a year ago. Whey stocks climbed to 54.1 million pounds, up 3.8 million or 7.6 percent from October, but were down 3.1 million pounds or 5.3 percent from a year ago.

Nonfat dry milk output dropped to 108.3 million pounds, down 12.3 million or 10.2 percent from October, and down 11.8 million or 9.8 percent from a year ago. NFDM YTD hit 1.5 billion pounds, up 0.7 percent from 2024. Stocks fell to 198.6 million pounds, down 9.4 million, or 4.5 percent from October, but up 7.1 million or 3.7 percent from 2024.

Skim milk powder production climbed to 40.5 million pounds, up 5 million pounds or 14.1 percent from October, and down 4.5 million or 9.9 percent from a year ago. YTD SMP hit 445.2 million pounds, down 18.8 percent from 2024.

Robust cheese production again created a hefty whey stream. The Daily Dairy Report stated “Processors made 18.3 million pounds of whey protein isolates, 15.6 percent more than the prior year. They also stepped-up production of the highest-protein category of concentrates, drying 19.2 percent more than in November 2024.”

StoneX analysis zeroed in on the Cheddar data and stated: “It is an important reminder that it is the availability of fresh Cheddar that drives the CME spot price and there is always a risk that cheese makers will cut Cheddar production even if total cheese production is growing well.”

USDA slaughter data showed 56,800 dairy cows were culled the week ending December 20, up 900 head from the previous week and 2,300 or 4.2 percent more than a year ago. Total to date, 2,583,700 cows had exited the dairy business, down 84,900 head or 3.2 percent from a year ago.

HighGround Dairy points out. “For the 15th consecutive week, weekly dairy cow slaughter was above the previous year. While 2025 is set to finish the year with the lowest total dairy cow slaughter since 2008, a trend is emerging as farmers take advantage of strong cattle prices. Some may be exiting the business, while others may be generating cash flow. Although the milk price outlook is not great, farmers have not yet received a bad milk check, and increased culling will likely be a headline in 2026,” says HGD.

Cash block Cheddar dropped 4 cents Monday, falling to $1.35 per pound. It regained 1.50 cents Wednesday, but gave back 3.50 cents Thursday to close at $1.33, lowest since June 29, 2023. It finished Friday at $1.39. The barrels were holding Thursday at $1.40, where they’ve been since Dec. 23.

Milk output is strong in the Central region, says Dairy Market News. Demand for Class III milk was up from last week, but somewhat lackluster. Reported spot prices for Class III milk ranged from $5-under to $1-under at mid-week. Cheese production was up from the holiday weeks. Domestic demand was strengthening and steady from international interests.

Spot milk was available in the West this week even though bottlers were busier with educational institutions back in session.

Cheese production was steady for the most part. Domestic demand was stronger but not the prices. International demand was somewhat lighter to steady. Market sentiment is bearish says DMN.

Butter continues to hemorrhage as lots of product makes its way to the CME, 60 loads so far this week. It fell to $1.3025 per pound Thursday, lowest CME price since Feb. 10, 2021, when it was at $1.28. It closed Friday at $1.3750.

HighGround Dairy warns, “Heavy milkfat supplies in the U.S. are causing butter production to soar and inventories of CME-eligible salted product have piled up.”

DMN says cream production is strong in the Central region and demand from Class II and Class III processors was strengthening. Some butter makers were purchasing more cream than they were during the holiday weeks. Churning was more active this week and plants were running busy schedules. Domestic butter demand is steady while export interest is strong, according to DMN.

CME Grade A nonfat dry milk climbed to $1.2475 per pound Thursday, highest since Sept. 2, 2025, after finishing Friday at $1.1750.

Dry whey saw its Thursday close at 70 cents per pound. It finished Friday at 72.50 cents per pound.

The New Year started positively in its first Global Dairy Trade Event. The weighted average jumped 6.3 percent, following a 4.4 percent drop on Dec. 16, and was the first positive move in 9 events. Volume continued to fall however, totaling 64.6 million pounds, down from 74.9 million on December 16, and the lowest since July 15, 2025. The average metric ton price crept to $3,533 U.S., highest since Nov. 18, 2025, and up from $3,341 on Dec. 16.

All products saw advances, led by anhydrous milkfat, up 7.4 percent, after dropping 5.2 percent on Dec. 16. Butter was up 3.8 percent, following a 2.5 percent drop. Whole milk powder was up 7.2 percent after leading the declines on Dec. 16 with a 5.7 percent plunge. Skim milk powder was up 5.4 percent, after falling 2.1 percent. Buttermilk powder was up 5.1 percent. GDT Cheddar inched up 0.6 percent, after holding steady Dec. 16, and GDT mozzarella was up 0.7 percent, following a 6.7 percent jump on Dec. 16.