MRV BLOG: MRV Market Commentary November 24, 2025

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:

Key Drivers Behind the December 2025 Class I Milk Price Rise

📊 December brought a notable shift in dairy markets, with the Class I base milk price rising to $18.21/cwt. Here’s what drove the increase:

1️⃣ Updated USDA Pricing Formula
The Federal Milk Marketing Order (FMMO) revisions went into effect, including a return to the “higher of” Class III or Class IV skim pricing method. This change alone helped lift December’s base price.

2️⃣ Modernized Milk Component Assumptions
USDA updated the assumed levels of protein and other solids to better reflect today’s milk composition. These adjustments increased the calculated value of skim milk in the formula.

3️⃣ Revised Make-Allowances
Processing cost allowances for products like cheese, butter, and non-fat dry milk were increased. These updates support processors while contributing to stronger Class I price calculations.

4️⃣ Refined Regional Differentials
Zone differentials—the premiums added based on geography—were reevaluated, affecting how the December Class I price translates across FMMO regions.

5️⃣ Higher Skim Milk Value
December’s Class I skim price climbed to $12.74/cwt, driven by a wider spread between Class III and Class IV skim pricing factors. This added significant upward pressure on the final Class I price.

6️⃣ Butterfat Value Eased but Remains Influential
Although the butterfat pricing factor dipped to $1.69/lb due to oversupply, it remains a key component in determining the Class I price.

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.

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