World Agricultural Outlook Board Chairman Mark Jekanowski provided an update on the latest dairy market outlook, outlining changes to USDA forecasts for butter, nonfat dry milk and dry whey prices in 2026 and 2027.
Butter and Nonfat Dry Milk Forecasts
USDA lowered its 2026 butter price forecast by four cents per pound, bringing the projection to $1.65 per pound. The agency also expects some improvement in butter prices next year, with the 2027 forecast rising to approximately $1.71 per pound.
Jekanowski also discussed the outlook for nonfat dry milk. USDA reduced its 2026 forecast by one cent per pound to $1.61, although he emphasized that the projected price remains relatively strong.
“But even with that reduction, that’s still a very strong nonfat dry milk price at $1.61,” Jekanowski said.
Looking ahead to 2027, USDA left its previous nonfat dry milk forecast unchanged at $1.47 per pound. Jekanowski said prices are expected to move lower as the market gradually returns toward more historical price levels.
Strong Protein Demand Supports Dry Whey
While butter and nonfat dry milk forecasts were adjusted lower, the outlook for dry whey moved in the opposite direction.
USDA increased its 2026 dry whey price forecast by one cent per pound and raised the 2027 forecast by three cents. Jekanowski attributed the continued strength to demand for dairy proteins.
“This continues to reflect strong protein demand that has kept those dry whey prices fairly persistently elevated for the past several months,” he said.
The differing forecasts highlight the changing dynamics across dairy product markets. While some products are expected to see prices moderate, continued demand for dairy proteins is providing support for other segments.
For dairy producers, the updated projections offer a look at how USDA expects product values to develop through the remainder of 2026 and into 2027.
Hear more from Mark Jekanowski about the latest dairy market outlook in the audio report below.