by Andrew P. Griffith, Livestock Marketing Specialist
February 27, 2026
Milk Production
Milk production in the 24 major states during January totaled 19.1 billion pounds, up 3.4 percent from January 2025. Production per cow for January averaged 2,082 pounds. The number of milk cows was 9.15 million head, 15,000 more than December 2025. December production was revised down 0.2 percent from preliminary estimates. For milk production in the top 5 producing states, California increased 4.7% from January a year ago; Wisconsin up 2.1%; Texas up 7.6%; Idaho up 3.2%; and New York up 3.4%. Other states with large production increases were Kansas (26.1%), South Dakota (10.9%) and Georgia (6.9%). States with large production decreases were Washington (-6.1%) and New Mexico (-3.8%).
Milk Price and Utilization
The Southeast Uniform milk price for January was $20.79, down $1.10 from December and $3.00 lower than January 2025. The Appalachian Uniform milk price was $20.32 down $1.48 from December and $2.96 lower than January 2025. December’s Class III price was $14.59, down $1.27 from December, and $5.75 lower than January a year ago. The Class IV price was down $0.09 at $13.55, and $7.18 lower than January 2025. The Class I Mover price for March is $15.47, up $0.77 from February. The milk/feed ratio for January was 2.09, down 0.17 from December.
Southeast Class I utilization was 82.14%, up 6.20% from December and 2.41% higher than January a year ago. The Uniform butterfat price was $1.5434, down 10.98 cents from last month and 141.24 cents lower than January 2025. The January Class I price was $22.15. February Class I price is $20.50. Appalachian Class I utilization was 78.06%, up 1.92% from December, and 1.89% higher than January a year ago. The Uniform butterfat price was $1.5390, down 11.50 cents from last month and 141.67 cents lower than January 2025. The January Class I price was $21.95.
Cheese Production and Stocks
Total cheese production in December was 1.28 billion pounds, up 6.7% from a year ago while butter production was up 2.0% to 204 million pounds. Nonfat dry milk (NDM) production was down 2.7% compared to a year ago with total production at 127 million pounds while skim milk powder (SMP) production was down 15.2% to 43.1 million pounds compared to a year ago. Total cheese stocks at the end of January were up 1% from January a year ago and up 1% from the previous month while butter stocks were up 15% from last month and down 17% from a year ago.
Cow Slaughter
Dairy cow slaughter in January was 246,800 head, down 1,600 head from December and 1,000 head less than January 2025.
Southeast Federal Order Prices
| Month | Uniform Price $/cwt. | Class I Price $/cwt. | Class III Price $/cwt. | Class IV Price $/cwt. | Class I % Utilization | Butterfat Price $/lb. |
|---|---|---|---|---|---|---|
| Jul 25 | 23.68 | 24.62 | 17.32 | 18.89 | 73.68 | 2.8067 |
| Aug 25 | 23.55 | 24.73 | 17.24 | 18.50 | 76.54 | 2.8123 |
| Sep 25 | 22.72 | 24.50 | 17.59 | 16.17 | 79.77 | 2.4945 |
| Oct 25 | 21.91 | 23.84 | 16.91 | 14.30 | 79.82 | 2.1222 |
| Dec 25 | 21.89 | 24.01 | 15.86 | 13.64 | 75.94 | 1.6532 |
| Jan 26 | 20.79 | 22.15 | 14.59 | 13.55 | 82.14 | 1.5434 |
Appalachian Federal Order Prices
| Month | Uniform Price $/cwt. | Class I Price $/cwt. | Class III Price $/cwt. | Class IV Price $/cwt. | Class I % Utilization | Butterfat Price $/lb. |
|---|---|---|---|---|---|---|
| Jul 25 | 23.24 | 24.42 | 17.32 | 18.89 | 71.71 | 2.8106 |
| Aug 25 | 23.02 | 24.53 | 17.24 | 18.50 | 73.07 | 2.8063 |
| Sep 25 | 22.29 | 24.30 | 17.59 | 16.17 | 77.49 | 2.4702 |
| Oct 25 | 21.42 | 23.64 | 16.91 | 14.30 | 76.11 | 2.0923 |
| Dec 25 | 21.80 | 23.81 | 15.86 | 13.64 | 76.14 | 1.6540 |
| Jan 26 | 20.32 | 21.95 | 14.59 | 13.55 | 78.06 | 1.5390 |
What is the Market Offering for Milk to be Sold in May?
Ex: It is Feb. 27 and May Class III milk futures are trading at $17.91. Local May basis estimate is +$3.00.
| If May futures | = | 19.50 | 18.00 | 16.50 | |||
| and actual blend price | = | 22.50 | 21.00 | 19.50 | |||
| Sample Strategies | Realized Prices for May Milk | ||||||
| 1) Sold Futures | @ | 17.91 | 20.91 | 20.91 | 20.91 | ||
| 2) Bought Put | 17.00 | @ | 0.50 | 22.00 | 20.50 | 19.50 | |
| 3) Bought Put | 17.50 | @ | 0.64 | 21.86 | 20.36 | 19.86 | |
| 4) Bought Put | 18.00 | @ | 0.87 | 21.63 | 20.13 | 20.13 | |
| 5) Synthetic Put | |||||||
| Sold Futures | @ | 17.91 | |||||
| Bought Call | 19.00 | @ | 0.59 | 20.82 | 20.32 | 20.32 | |