While dairy producers might not be feeling it amidst ongoing trade issues and price concerns, the demand for dairy is the strongest it’s been in the past five decades. According to data from the U.S. Department of Agriculture, the last time that per capita demand for dairy products was at its current level was back in 1962.
For the past 10 years there has been a steady decline of fluid milk sales, dropping nearly four billion pounds between 2013 and 2017. However, the latest Dairy Market Report showed positive signs for the industry, including a significant increase in domestic use. During the May-June period, use of all milk solids was so strong in the domestic market that it outpaced production.
While domestic demand is at a high point, prices have not been reflective of that success. Economists note that the softening of the international market is a primary factor for lower prices, with significant market and trade disruptions stemming from tariffs.