The inevitable flood of milk resulting from both a larger herd and peak milk production of spring flush finally appears to be weighing on the minds of dairy producers. The latest Global Dairy Trade auction results fell for the fifth-straight time, making the largest move lower since March. Overall global dairy prices trended lower by 1.3 percent; milk powder categories fell the most, with whole milk powder down 1.8 percent and skim milk powder down 1.7 percent.

May’s milk production brought both an upward revision to the prior month’s herd number and a further increase in the size of the total U.S. herd to just over 9.5 million animals, a new record.

Turning to inventory numbers, the June cold storage report likewise showed ample stocks of products around the country. Butter stocks climbed 4 percent over the previous month and 7 percent YOY, reaching a new record of just over 400 million lbs.

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U.S. month-ending butter stocks

Source: USDA