U.S. Butter Prices Dip in 2025 Amid Milk Supply Constraints
In 2025, U.S. butter prices are projected to average $2.445 per pound, a decrease from the 2024 average of $2.89 per pound. Despite this decline, prices remain significantly higher than pre-2024 levels. The USDA reports that milk production in 2024 decreased by 0.2% to 226 billion pounds, with the average number of milk cows dropping by 42,000 to 9.34 million head. However, production per cow increased by 61 pounds to 24,178 pounds. Cash receipts from milk marketing totaled $50.7 billion, up 10.5% from 2023, with producer returns averaging $22.56 per hundredweight. Iowa's dairy sector contributed significantly, with 243,000 milk cows producing 6,014 million pounds of milk and 267 million pounds of butterfat, generating over $1.3 billion in gross producer income. Despite increased exports and higher returns, domestic butterfat production is insufficient to meet consumption demands, indicating potential for continued price volatility.
Industry Insight:
The persistent gap between butterfat supply and demand, coupled with strong export activity, suggests that while consumer prices have eased slightly, the market remains tight. Dairy stakeholders should monitor production trends and international demand to navigate potential fluctuations in butter pricing.
Source : Dairynews7x7 May 28th 2025 Read full article here
