Welcome to episode 172 of the Bullvine Podcast, your weekly dose of dairy industry insights.
Today we're diving into the global weekly dairy market recap for February 17th, 2025.
We've got a jam-packed episode covering everything from production surges to trade tensions and
shifting consumer trends.
So grab your favorite milk-based beverage and let's churn through this week's dairy developments.
Welcome to the Bullvine Podcast, your weekly dose of dairy industry insights.
I'm Bella and with me as always is our resident dairy expert, Douglas.
Today we're diving into the global weekly dairy market recap for February 17th, 2025.
Douglas, what's churning in the dairy world this week?
Well, Bella, it's a real mixed bag out there.
We've got cheese prices on the rise, but butter and powders are softening.
The U.S. is dealing with milk surpluses in some areas while others are struggling with
production.
And to top it off, new tariffs are stirring up concerns about trade tensions.
Sounds like a lot to unpack.
Let's start with the big picture.
What are the key developments we're seeing?
First off, the Canadian Dairy Commission has made a slight adjustment to farm-gate milk
prices, decreasing them by 0.0237% for 2025.
It's a small change, but every bit counts in this industry.
That's true.
What about production forecasts?
The USDA has revised its 2025 milk production forecast upwards to 227.2 billion pounds.
That's a significant increase, driven by both higher cow numbers and improved milk yields.
Wow, that's a lot of milk.
Are we seeing similar trends globally?
Indeed we are.
Rabo Research is projecting a 0.8% increase in milk supply from major exporting regions
in 2025.
What's interesting is that all key areas are expected to see gains for the first time since
2020.
That's fascinating.
It seems like the dairy industry is really ramping up production.
But I'm curious, how is this affecting prices and trade?
Well, that's where things get a bit complicated.
We're seeing mixed price movements across dairy commodities.
Cheese is showing resilience, but other products are facing downward pressure.
And then there's the trade situation.
Ah, yes, you mentioned new tariffs earlier.
What's happening there?
The U.S. has announced new trade actions, including increased steel and aluminum tariffs.
This could potentially affect U.S. dairy exports, which are crucial for the cheese market in
particular.
That sounds concerning.
How are farmers faring in all of this?
There's actually some good news on that front.
The USDA is projecting a significant increase in net farm income for 2025, largely driven
by disaster and economic government assistance.
Well, that's a relief.
Now let's dive a bit deeper into the market trends.
What are the key challenges and opportunities you're seeing?
One of the biggest challenges is managing regional disparities in milk production.
We've got surplus conditions in some areas, while others are facing shortages due to weather-related
issues.
Adapting to changing consumer preferences and price sensitivities is also a major concern.
And what about opportunities?
There are several exciting opportunities.
We can leverage the projected global supply growth to expand market share in key export
markets.
There's also a growing demand for health-conscious and sustainable dairy products, which opens
up avenues for innovation.
Speaking of markets, can you give us a snapshot of the futures market?
Certainly.
Looking at EEX futures, we saw a total volume of 1,235 contracts traded this week.
Butter futures showed a slight downward trend, with the February 2025 contract closing at
5,565 euros per ton.
Skim milk powder futures remained relatively stable.
And what about other futures markets?
On the SGX, we saw 890 contracts traded.
Class III milk futures for February 2025 settled at $20.21 per hundred weight, while Class
IV futures concluded at $19.85.
Interesting.
How does this translate to spot market prices?
As of February 11, butter was at $2.40.5 per pound, down slightly from the previous week.
Cheddar block prices increased to $1.90.5 per pound.
We're seeing a complex supply and demand dynamic playing out in these numbers.
It certainly sounds complex.
Let's talk about regional production and demand.
You mentioned earlier that there are some disparities.
That's right.
In the U.S., we're seeing overall growth in milk production, but there are significant
regional differences.
The Midwest is experiencing surplus conditions, while the Northeast is facing challenges due
to harsh winter weather.
And what about other major dairy-producing regions?
The European Union is expecting slight growth in milk production for 2025, with variations
across member states.
New Zealand, on the other hand, has adjusted its forecast downward by 2% due to dry conditions.
Interestingly, China is projected to see a 2% year-on-year growth in dairy import volumes,
reversing a three-year decline.
That's quite a global tour of dairy production.
Now, I know our listeners are always interested in consumer trends.
What are you seeing on that front?
We're seeing increased demand for functional dairy products, like probiotic yogurts and
fortified milk.
There's also growing interest in low-fat and reduced-sugar options, as well as organic
and grass-fed dairy products.
The on-the-go dairy snacks and single-serve portions continue to be popular.
It sounds like consumers are really focusing on health and convenience.
How is this affecting the overall market?
The global dairy market is showing strong growth potential.
According to a report from Mordor Intelligence, the market size is expected to grow from $649.9
billion in 2025 to $813.6 billion by 2030, with a compound annual growth rate of 4.6%.
Those are impressive numbers.
As we start to wrap up, what's your outlook for the future of the dairy industry?
The all-milk price forecast for 2025 is $23.05 per hundred weight, which is 50 cents higher
than last month's forecast.
We're expecting global milk supply to grow by 0.8% in 2025.
However, we're still facing ongoing challenges with evolving trade relations, fluctuating
prices and changes in global agricultural supply.
It sounds like dairy farmers and industry stakeholders have a lot to keep an eye on.
Any final thoughts or advice?
My advice would be to stay informed about regional production trends, consider hedging
strategies to mitigate price volatility risks, and invest in innovation to meet changing
consumer demands.
It's a challenging but exciting time in the dairy industry.
Bella, thank you, Douglas, for this comprehensive overview of the global dairy market.
To our listeners, we hope this information helps you navigate the complex world of dairy
farming and trading.
Remember to subscribe to the Bullvine Podcast for more insights into the dairy industry.
And until next time, keep those cows happy and healthy.
And that wraps up our deep dive into the global dairy market.
Remember, in this ever-changing landscape, staying informed is your best strategy.
Whether you're managing regional disparities, navigating trade tensions, or innovating to
meet consumer demands, the key is adaptability.
Subscribe to the Bullvine Podcast to keep your finger on the pulse of the dairy industry.
Share this episode with your fellow dairy enthusiasts, and don't forget to leave a
review.
Your feedback helps us serve you better.
Until next time, may your milk yields be high and your feed costs low.
Keep those udders moving, dairy farmers.