Dairy Prices Summary
Farm milk and dairy product prices in the U.S. and around the world increased in 2010 following the global
financial crisis in 2009. The all milk price paid by plants to U.S. dairy farmers increased by $3.47 (a 27%
rise) per hundredweight of milk in 2010 to $16.29, the third highest on record. The implied cost of dairy
feed per hundredweight fell 3 cents to $7.17 in 2010. However, the higher farm milk price resulted in an
increase in the milk-feed price ratio to 2.27 from the record low experienced in 2009.
The minimum government-regulated prices that dairy processors and manufacturers must pay to dairy
farmers and cooperative which supply them milk also increased. The Class I minimum price paid for milk
used to make fluid milk products increased by 26.7% to $18.25 per hundredweight. Class II is for the
so-called soft manufactured dairy products, including fluid creams, ice cream and cultured products like
yogurt and cottage cheese; the federal order Class II minimum milk price increased by 42.3% to $16.02.
Farm milk used to make hard cheeses and whey products is Class III milk, and that minimum regulated
price increased by 26.8% to $14.41 per hundredweight. The final class of milk use under federal order
regulation, Class IV for butter and dry milk products, saw its minimum regulated price increase by 38.6% to
$15.09 per hundredweight.
Wholesale market prices for Grade AA butter , cheddar cheese, nonfat dry milk and dry whey all saw an
upward trend during 2010 and early 2011. These higher wholesale market prices meant that government
purchases of dairy products under the Dairy Product Price Support program fell substantially in 2010.
