U.S. milk production continues its upward climb, with September 2026 output reaching 18.7 billion lb. across the 24 major dairy states — up 2.7% from September 2025, according to the latest USDA Milk Production Report.
The growth story isn’t just about more cows. It’s about more productive cows in a larger herd, creating a compounding effect that’s reshaping U.S. dairy supply.
The Dual Engine of Growth
September’s production increase came from two sources: the U.S. dairy herd grew to 9.30 million head in the 24 major states, adding 162,000 cows compared to September 2025. At the same time, production per cow averaged 2,012 lb. for the month — 18 lb. above the previous year.
“We’re seeing historic growth in milk components,” said Corey Geiger, senior vice president of strategy and business development at CoBank, speaking at the recent joint annual meetings in Orlando, Fla. “That is a good thing. We’re meeting what processors want.”
The July-September quarter told a similar story nationally: total U.S. milk production reached 59.5 billion lb., up 2.3% from the same quarter in 2025. The national dairy herd averaged 9.72 million head during the quarter — 172,000 head more than the prior year.
State-by-State Performance
Kansas led all states in percentage growth, with September production jumping 14.7% to 492 million lb. The state added 29,000 cows to its herd while also improving per-cow productivity.
Other strong performers included:
- South Dakota: Up 7.9% to 494 million lb.
- Georgia: Up 7.1% to 180 million lb.
- Indiana: Up 7.4% to 404 million lb.
- Oregon: Up 6.6% to 226 million lb.
California, the nation’s largest dairy state, held essentially flat at 3.29 billion lb. — a negligible 0.03% increase — despite adding 5,000 cows to reach 1.718 million head.
Arizona was the only major state to see production decline, dropping 4.9% to 350 million lb. as the state’s herd contracted by 10,000 head.
The Component Story: Historic Butterfat, Surging Protein
Behind the production numbers lies an even more significant transformation in milk quality and composition.
“Since data has been collected since 1924, we have not seen more butterfat levels in our milk supply,” Geiger told the audience in Orlando. U.S. butterfat content has climbed from 3.71% in 2011 to a historic 4.32% today.
Protein content has followed a similar trajectory, rising from 3.08% in 2011 to 3.34% currently — a 23% increase over 15 years, compared to just 18.4% growth in total milk volume.
“The momentum is building now,” Geiger explained, showing data on component levels measured every two years. “Butterfat has slowed a little bit because this year the average price through September is $1.69 per pound, where last year it was $2.45.”
But protein is having a significant moment, driven by structural shifts including clean label trends, GLP-1 weight loss drugs increasing protein demand, and the MAHA (Make America Healthy Again) movement’s focus on whole foods.
“The proteins found in our dairy products are the most complete known to humanity,” Geiger emphasized. “All the essential amino acids needed by the human body for growing muscle are found in dairy proteins.”
The Genetic Flywheel
The rapid improvement in milk components isn’t primarily about management changes — it’s genetic momentum that will continue regardless of short-term price signals.
“72% of the improvement in dairy protein in the U.S. milk supply in the last 10 years has come through genetics,” Geiger noted. “Butterfat is only 62%, meaning there’s more tools in the toolbox to improve butterfat.”
The Global Context: Leading in Butterfat, Lagging in Protein
Comparing the U.S. to other major dairy exporters reveals both strengths and challenges.
U.S. butterfat content (4.32%) now exceeds the European Union (4.25%) and is closing in on New Zealand’s crossbred Holstein-Jersey herds that average 5.0% butterfat.
“The U.S. butterfat supply has been growing substantially,” Geiger said. “We grow butterfat at a faster rate than the EU,” which is 1.6 times larger than the U.S. dairy industry and exports 20% of its production.
But on protein, the U.S. (3.34%) still trails the EU (3.95%) and New Zealand (4.0%+).
“We have not caught up to the EU on protein, and that’s a problem,” Geiger warned. “If 49% of our milk solids go into cheese — and I firmly believe looking at this and studying it that we have not updated our yield formulas for cheese and other products — in 2010, 100 lb. of milk made 10 lb. of cheese. Now we’re at 11.6 lb.”
The Cheesemaker’s Challenge
For U.S. cheese industry — the world’s largest — the protein-to-fat ratio has become a critical issue.
Ideally, cheesemakers want a protein-to-fat ratio above 0.8. The U.S. was at 0.83 in 2015 but has been declining as butterfat growth outpaces protein. Meanwhile, the EU has maintained a steady 0.83-0.84 ratio.
“So, what does this mean for an American cheesemaker? You have to put a separator in,” Geiger explained. “Mozzarella and Italian styles have been doing this for years, but now our American-style cheesemakers — cheddar, Colby, Monterey Jack — have got to standardize the milk, or the fat-on-dry-basis gets too high, and that is not good with retailers.”
Export Growth: The Bright Spot
While domestic component challenges create processing headaches, U.S. dairy exports continue breaking records.
“We are on pace for $10.5 billion this year — a record by a billion dollars,” said Gregg Doud, CEO of NMPF said.
Krista Harden, president and CEO of the U.S. Dairy Export Council, noted that under her leadership: “U.S. dairy exports have reached unprecedented heights, breaking records for three consecutive years in 2022, 2023 and 2024.”
The September production report supports this export momentum: with domestic per capita consumption relatively stable, the additional 2.3%-2.7% production growth creates surplus that must find homes in international markets.
Month-to-month herd changes in September showed modest but consistent growth:
- The 24-state total added 24,000 head from August to September 2026
- Year-over-year, the September herd was 162,000 head larger
- Wisconsin led in absolute numbers with 1.306 million cows, up 26,000 from September 2025
- California’s 1.718 million head remained the largest state herd, up 5,000 year-over-year
Smaller dairy states showed mixed results, with some like Kansas (+29,000 head) and Indiana (+11,000 head) showing strong expansion, while others like Arizona (-10,000 head) and Utah (-3,000 head) contracted.
What It Means for Dairy’s Future
The September milk production report captures an industry in transformation:
Short-term: Continued production growth of 2%-3% annually creates both opportunity and challenge. Export markets must absorb increasing volumes, while domestic processors grapple with component imbalances.
Medium-term: The protein deficit relative to butterfat will require either significant shifts in breeding priorities (which take years to implement) or continued investment in milk standardization equipment by processors.
Long-term: Genetic momentum ensures component levels will keep rising. The question isn’t whether milk will become richer in protein and butterfat, but whether the industry can develop markets and products that capitalize on this abundance.
“We have an abundance of butterfat,” Geiger said. “We are going to be in that situation for a long time to come, and we’re going to have to find new homes for that product.”
Matt McClellan, CEO of Prairie Farms Dairy said: “If we’re going to milk more cows, we’ve got to have a market. And protein is going to drive a lot of that market, especially in the next 10 years.”
The September numbers suggest U.S. dairy farmers are ready to supply that market. Now the industry must ensure demand keeps pace.
