MRV BLOG: MRV Market Commentary April 7, 2023

Check in here to see the MRV commentary on what we have seen and are seeing in the dairy market.  These insights have been developed from MRV’s proprietary data, industry experience, and industry reports referenced below. Here’s our latest:


Domestically we are seeing butter make a slight detour on its way up, instead, moving down 2 cents month-over-month. Block and barrel cheese on the other hand made upward swings, increasing 4 cents and an astonishing 28 cents respectively (MoM). Both the butter and cheese volumes have a slight downward trend. Conversely, NDM and dry whey have had significant differences in their volumes over the last month, (NDM) down 40% and (dry whey) up 25% respectively. MRV Dairy Solutions projects May’s class I price change to be moving upward in price. Given the current market, as of 4/7/23, we are anticipating June to be relatively flat with a couple more increases in July and August before coming back down.


As spring is already among us in 2023, milk production will also start ramping up into summer. February’s U.S. milk production increased 0.8% over last year, however, falling short of 2021’s levels. Dryers have been very active with total production of NDM and SMP increasing 8.1% over the last year. Production of SMP was especially noticeable with an increase of 28.9% versus February last year.

Production is also reflective of the increase in head from the beginning of 2022, up 37,000. Quite astoundingly, the number of dairy farms has dropped by 60% since 2003. Dairy farms decreased by 6.5% in the last year alone. This follows what was referenced in December’s MRV Commentary, “Meaning, the most valuable economic model in the future will be larger farms of more than 5,000 head.”

Dairy Formulas Might Change

We will be seeing formulaic changes to all dairy classes this year. The IDFA (International Dairy Foods Association) has petitioned to USDA to make a change in the FMMO formulas, which the USDA has until the 29th of this month to decide whether to call a hearing on this petition. Combatting the IDFA’s change is the NMPF (National Milk Producers Federation), who has instead recommended a different change to the formulas. One of which is a reversion on the class I formula with alternative changes to the other classes. The Class I formula change was introduced in a farm bill in 2018, due to COVID in 2020, this formula change has not aged well.


U.S. export volume increased 0.8% (MoM) but its value decreased 0.3% compared to February of last year. This is exports first decline in value in two years, albeit very modestly.  Despite this decrease, this was still the second largest ever for February exports. These export dynamics are expected to continue into the middle part of this year. U.S. exports are still expected to grow in 2023, but not near to 2022’s 5% increase.


MRV projects Class I prices to start moving up again. While head count is higher and production is up, the farm attrition rate continues to climb. There most likely will be some formula changes to all classes of dairy. At the earliest we will know by end of this month and at the latest, and may also go into effect by, the end of the year. U.S. dairy exports are still expected to grow in 2023, but not at last year’s pace.

Statistical data referenced here gleaned from reports by MRV Proprietary Data, USDEC, AGNet, CME Group,  Daily Dairy Report, Dairy Herd Management, and USDA.


This information cited by MRV Marketing, LLC is for informational and reference purposes only. It is not intended to be a conclusive statement of future market conditions. It is not legal advice or legal documents. The data used in these documents contains references to information created and maintained by other organizations or agencies. Please note that MRV Marketing, LLC does not control and cannot guarantee the accuracy of these outside materials.


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