New Year, Same Bearish Dairy Market

Wed, 07 Jan 2026 17:32:16 GMT

December was a month of catch up for the government to resume some of the final reports missing from the market since the government shut down. The Cold Storage Report was one of the most awaited reports, released December 23^rd. This brought the market up to speed on what inventory was on hand for most for butter and cheese as well as some frozen meat, fruit and vegetables.

Cheese stocks were down 1 percent from the previous report but up 2 percent from November 2024. Swiss cheese was the only product with more on hand than last month but interestingly enough, it was the only product with less than a year ago. Butter stocks were down 8 percent from last month and down 1 percent from 2024.

To put in in perspective, when comparing to 2023 stocks, butter was down 1% from 2023, while cheese stocks were down over 5 percent from two years ago. Therefore, the report could have been perceived as somewhat friendly, unfortunately, it just wasn’t enough to get the market excited, given the surplus of production seen in 2025.

While milk production has been declining from the summer highs, it is still seen to be well above previous year’s production throughout most of 2025, with the most recent report showing production up 4.5% in November when compared to 2024. Even if the market continues to slow production, the total production for the year still exceeds any domestic or foreign demand seen today.

Exports Grow, but at the Cost of Price

Foreign demand has been a bright spot in the U.S. dairy market, despite the lack of Chinese demand, there has been increases in export demand across most dairy sectors with butterfat showing the largest gains in 2025 with 150 percent increase from 2024 as of the September data released mid-December. This extra demand is a direct correlation of falling butter prices with the surplus of domestic product. Cheese sales also set a new monthly record with a 35 percent increase in export demand year over year in the month of September.

As we follow trends, we can see that U.S. cheese had more product sold in foreign markets in the first nine months of 2025 than was sold in any single year outside of 2024. Butter has been impressive to watch despite the tensions with Canada. While sales to our northern neighbor have declined, sales to The Netherlands, Australia and Saudi Arabia have exploded. Although new foreign demand was prevalent, it came at the cost of lower prices in order to open opportunities in those foreign markets.

In terms of foreign markets, the question asked most today is what impact the capture of Venezuela’s President could have on dairy markets, if any. To answer that, it is more complicated than looking at today’s import volumes. For example, the United States is the leader in supplying whey product and SMP to Venezuela, however Columbia and Brazil dominate most of the supply for liquid and condensed milk products being shipped into the country.

Venezuela’s Growing Role in U.S. Trade

When looking over the past five years, the United States has seen a large increase in demand for its products in Venezuela, becoming the second largest supplier of agricultural products for their country. Dairy and pet food have grown the most, although still a small portion of the products we ship to Venezuela. The most notable agricultural product shipped to Venezuela is soybean meal as we are their biggest supplier. For the cattle industry, our genetics have been in high demand as they work to improve their herds.

President Trump has stated that the U.S. will run Venezuela for the short term which could be beneficial to support cost effective trade with the country for many agricultural products. For dairy, they have a modest demand in the big picture for our country. Increase soybean meal demand could cause more issues for the U.S. Dairy farmers as it could increase cost of production. All of this is speculative in these early stages. What we do not know is how much instability this could bring to the Venezuelan economy or what global backlash could come in the next few months.

In conclusion, the U.S. dairy industry is fighting over supply and looking for a story to help eat through the surplus of product getting produced. While there is no near-term solution, there are a lot of unanswered questions in world trade as we navigate through tariffs, geopolitical conflict and strong global demand.

Sarah Jungman is a commodity broker with AgMarket.Net and AgDairy, the dairy division of John Stewart & Associates Inc. (JSA). JSA is a full-service commodity brokerage firm based out of St. Joseph, MO. Sarah’s office is located in Winterset, Iowa and she may be reached at 515-272-5799 or through the website www.agmarket.net .

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Venezuela Dairy Industry Slowly Bouncing Back

Wed, 29 Jun 2022 16:04:01 GMT

Venezuela’s economy has been in tatters for years, but recently the nation’s economy has been showing signs of strength. According to Bloomberg, nearly every economic metric shows Venezuela’s economy is improving. For instance, the country’s gross domestic product is now growing anywhere between 1.5% and 20%, depending on which economist is doing the forecasting.

In January, Venezuela’s hyperinflation, which had been running at a near 2- million-percent annual clip, ended, and some of the estimated 6 million people who had left the country for better opportunities are now returning to their homeland. While this bodes well for dairy consumption, the country will have to stage a steep recovery before it returns to its latest economic peak.

“Venezuela provides a cautionary tale in Latin America, and beyond, for how economic malaise can undermine a country’s dairy industry,” said Monica Ganley, analyst with the Daily Dairy Report and principal of Quarterra, an agricultural consulting firm in Buenos Aries.

“Historically, Venezuela has been a key dairy importer within South America, with dairy imports exceeding $1.3 billion at their peak in 2012,” Ganley said. “But sweeping economic pressures and dwindling foreign reserves undermined imports until they collapsed in 2020 to just $65.5 million.”

By 2021, Venezuela’s dairy imports had improved to $107.4 million, bolstered by shipments from Brazil, another net importer within the region. Last year, Brazil’s weak currency created a window for the country to expand dairy exports. This year, USDA expects Venezuela’s dairy imports to hold steady.

“Venezuela’s macroeconomic challenges have had devastating consequences for consumers, but things have started to improve. For instance, dairy consumption has increased after bottoming in 2018,” Ganley said.

Per capita dairy consumption in Venezuela rose to an estimated 60 liters per capita in 2021. However, this was still only about half of the 115 liters per capita Venezuelans consumed in 2008 and only about 20% of what Americans consume on an annual basis.

“Venezuelan milk production appears to have stabilized after falling dramatically but it will likely remain well below historical levels as producers in the country grapple with crumbling infrastructure, fuel shortages, and economic turmoil,” Ganely said.

According to a recent Global Agricultural Information Network (GAIN) report, USDA estimated that Venezuela’s output rose 2% to 1.52 billion liters in 2021, compared to the prior year. USDA also expected higher milk prices to spur a similar increase this year, with estimated output to reach 1.55 billion liters.

The country’s ongoing economic and infrastructure problems have also affected its dairy processors, Ganley noted. Currently, Venezuelan dairy processors are only using 20% of their installed capacity.