Thursday Closing Dairy Market Update - Cattle Slaughter Increase in April

GENERAL OVERVIEW:

The weakness does not stop. Spot prices are making another leg down as selling intensifies. Nonfat dry milk showed exceptional weakness as buyers step back. Dairy cattle slaughter increased from the previous year.

MILK:

Milk futures took another beating, with Class IV contracts hit harder than Class III. The weakness in Grade A nonfat dry milk took quite a bit of premium out of the market. The bearishness of the market has increased and may be difficult to overcome anytime soon. Dairy farms are pushing as much milk as possible to compensate for lower milk prices. Dairy cattle slaughter in April totaled 215,100 head, down 24,100 head from March. Slaughter increased by 7,900 head from April 2025. This stands to reason due to the higher cow numbers. Higher cow numbers would increase the volume of cows that might move to slaughter, but it would not reduce the herd. USDA will release the April Milk Production report on Friday.

AVERAGE CLASS III PRICES:

3 Month:	$16.83
6 Month:	$17.46
9 Month:	$17.65
12 Month:	$17.67

CHEESE:

The block cheese price lost most of what it gained on Wednesday. The barrel cheese price declined to the lowest level it has been since February 19th. Buyers continue to hold back in the spot market, waiting for sellers to lower prices. Buyers remained willing to purchase supplies, but only at a lower level. As long as sellers remain aggressive, buyers will remain complacent.

BUTTER:

Butter is unable to find a bottom and is heading back to the lows from the beginning of the year. The large decline in Grade A nonfat dry milk moved the price to the lowest level since April 9th and the largest one-day decline since September 19, 2008. The daily price calculation for class prices showed the Class IV price declining by $1.01 per cwt today, just in the decline of nonfat dry milk alone.

OUTSIDE MARKETS SUMMARY:

July corn closed down 3.50 cents per bushel at $4.6225, July soybeans closed down 5.50 cents at $11.9425 and July soybean meal closed down $2.50 per ton at $328.40. July Chicago wheat closed down 13.00 cents at $6.4750. August live cattle closed down $5.95 at $239.35. July crude oil is down $1.91 per barrel at $96.35. The Dow Jones Industrial Average is up 276 points at 50,286, with the NASDAQ up 23 points at 26,293.

Fluid Milk and Cream - Western U.S. Report 21

California milk production varies from steady to lighter for week 21. Stakeholders indicate warmer temperatures are reducing cow comfort in some areas. May 2026 milk production is up slightly compared to last month. Milk output continues to be up significantly year-over-year. Manufacturers note milk intakes are above expectations but are manageable. Although spot loads remain available, Central Valley processors describe milk volumes as balanced. 

In Arizona and New Mexico, farm level milk output varies from steady to lighter. Some manufacturers are securing spot milk loads. 

Milk production in the Pacific Northwest is steady. Some stakeholders indicate milk volumes are somewhat tight. 

In the mountain states of Idaho, Utah, and Colorado, farm level milk output is steady. Idaho processors report plenty of milk is available to meet needs and components remain strong. Colorado processors report milk volumes remain balanced relative to processing capacities. Class I, II, III, and IV demands vary from steady to lighter throughout the region with the upcoming holiday weekend and summer breaks beginning at educational institutions. 

Cream availability is accommodating buyer needs in the West. Cream demand and multiples are steady. No changes in condensed skim milk availability and demand are reported this week.

Thursday Midday Dairy Market Summary - Nonfat Dry Milk Falls

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	7 Lower
SOYBEAN MEAL:	$0.90 Lower
LIVE CATTLE:	$3.75Lower
DOW JONES:	265 Points Higher
NASDAQ:	78 Points Higher
CRUDE OIL:	$1.07 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined 3.00 cents, closing at $1.54 with 10 loads traded. The barrel cheese price declined 3.50 cents, closing at $1.48 with two loads traded. It has been unusual to have any loads traded for barrels. The dry whey price increased 0.50 cent to close at 68.75 cents with no loads traded. Class III futures are 1-33 cents lower. The butter price declined 2.50 cents to close at $1.5250 with 31 loads traded. Grade A nonfat dry milk fell 11.75 cents to close at $2.0925 with seven loads traded. This is the largest one-day price decline since September 19, 2008. This solidifies that the top is in, and it may indicate that the market could fall faster than it went up. Class IV futures have only traded in the June contract, posting a loss of $0.39. Butter futures are 0.02 – 4.30 cents lower. Dry whey futures are 1.00 - 1.50 cents lower. Cheese futures are 2.10 cents lower to 0.10 cent higher. The April Livestock Slaughter report will be released today, providing the number of dairy cattle slaughtered for the month.