In this episode of Chart Chatter, Kathleen and Vuko dig into the latest global dairy data across three continents. From bearish signals in the U.S. cold storage cheese report to unexpectedly strong EU milk production, and Australia’s ongoing production declines, the team unpacks what’s driving markets right now. They also spotlight the Chart of the Week: a closer look at falling U.S. per-capita cheese consumption—and what it means for future demand and exports. A quick, data-driven tour through the world of dairy markets in under ten minutes.
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Future trading involves risk and is not suitable for all investors. Content provided in this segment is meant for educational purposes and is not a solicitation to buy or sell commodities.
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Welcome to Chart Chatter. Spend ten minutes with two Ed colleagues in two wildly different time zones to nerd out on global dairy market charts. I’m Kathleen, market intelligence director at Ever.Ag Insights in the US, and.
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I’m a senior analyst with Ever.Ag in Australia.
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And together we’re the host of Chart Chatter Vuko, it’s 5 p.m. in Buffalo on September 30th. And hey, you’re in spooky season. It’s October 1st. Yeah. In Melbourne. Are you all decorated for Halloween yet?
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Not at our place, but we have our costumes for this year, so it’s exciting.
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And what are you going to be Vuko? I have to know.
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Fred.
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Flintstone. Amazing. All right, well, we need photos for chart chatter in November, but with that vocal let’s look at today’s agenda. We’re going to talk about the US cold storage report. European dairy stocks EU milk production Australian milk production and our chart of the week which we aren’t going to give away just yet. I’m going to take it away with us.
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Cold storage. We did see both data for cheese and butter last Friday and we’re going to focus on cheese today. August U.S. cheese stocks reached 1.417 billion pounds in August. That was down 11 million pounds from July. That was a little bit lighter than the average 16 million pound decline between July and August. What I found interesting about this report, specific to cheese, is that the July stocks were actually revised higher based on USDA’s reporting.
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So when we look at the total cheese stocks move from a report to report basis, we actually saw a 1 million pound month a month gain. Looking specifically at American type cheese stocks, those inventories increased by 5 million pounds on average, a little bit higher than than the five year average year to date through August. However, American type cheese stocks were up 47 million pounds.
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That’s the biggest year to date gain going back to 2017. So some really interesting statistics out of the cold storage report.
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Yeah. So Kathleen, do you feel like this report was bearish for cheese prices in the US. And why would the market be rebounding in this case.
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Our initial read on this report was that it leaned bearish primarily that revision higher in the July stocks number making for that 1 million pound report to report move on. The total cheese stocks kind of nudged it in that lean leans bearish compared to neutral category. But as you noted we have seen us cheese prices moving a little bit higher this week.
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I suspect that part of that move is not necessarily tied to the cold storage report. Rather, we had some of the lowest prices that folks have been able to buy in quite some time, and that likely brought some folks out of the woodwork on the on the buy side. All right, Hugo, the US wasn’t the only one that published stock data here in the last week or so.
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Talk to me about European dairy stocks.
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Well, this week we also got a huge update out of the EDA on European stocks of butter, skim and cheese for July 2025. And if at first glance, the balance sheet for butter appears very heavy, and definitely the market prices do reflect that. Using a what we call a residual approach, we derived domestic consumption for the year to date, and it turns out demand is down 1.6% or about 17,000 pounds in the EU.
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And we increased production and imports and lower exports. It means that there was a a very large stock buildup in the first part of the of the year. And we think that build up is more than twice than the five year average.
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That’s pretty stark is certainly we’ve seen European butter prices go lower pretty quickly in the last few weeks. Do you think that given this updated data, that there’s more downside in the in the future? Yeah.
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For right now it looks like the the market has just found the bottom. Obviously we we lost about €2,000 over the last quarter. But I believe now that this balance sheet is already priced in and the market is waiting for another signal to go either higher or lower. But for right now, I think we found the bottom. All right, Kathleen, while we are at Europe, we have some new data on milk production in.
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The numbers appear pretty high. What’s happening in Europe?
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Oh for sure. At Google we’ve certainly seen a bit of a turnaround in the European supply situation here in the last few weeks. Right. The Germany numbers on a weekly basis have been trending well above expectations and well above the last two years. France has been trending higher as well. But when we look at the monthly breakdown for August, we’re talking about Dutch milk production up almost 5% year over year, French milk production 4% or better year over year, 2% gains in Germany and Belgium.
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Denmark up a percent as well. This is a pretty stark shift from what folks had anticipated to come out of Europe here in 2025, given all of the disease pressure concern around drought. But overall, it seems as though fairly firm pay prices, better than expected weather, and disease pressure that wasn’t quite as bad is as feared is helping to turn the tables and turn the tide on on overall milk production.
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And I’d say from an expectations perspective, sure seems like the end of the year could could finish up stronger than than initially anticipated and could put us on a strong footing going into 2026 as well, I guess. Vuko, is there anything specific out of the out of the data that really flagged to you as different or intriguing?
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These numbers all look better than expected then. I think overall in August we’re probably approaching close to 3% year on year in the Eu27 level, much better than previously expected. Them. That growth should continue into September and into Q4. I think these numbers killed many people in the industry by surprise, and that’s why the prices do reflect that.
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All right. What about Australian milk production? Anything that’s different there.
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Yeah, Australia actually is quite the opposite. Milk production fell 3% year on year in August. We’ve had sort of this consistent declines since the fourth quarter of 2024. And overall in the cold period, we’ve lost about 130,000,000l. As you can see on the chart, a lot of these declines are into the Victorian regions, which have definitely faced some challenging conditions.
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Obviously, hay prices are are really high. So for the full 2526 season, people in the industry expect a decline of more than 2% at the moment.
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Going back a few weeks ago, Hugo, we did talk a little bit about Australian imports of of dairy. Do you think that continuing to see a slide in in Australian milk production further increases the potential that imports are here to stay?
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Definitely. Especially for for butter, because Australia is not self-sufficient in butterfat historically. Obviously we have imports coming in from New Zealand, but now increasingly so from the US as well. Given the huge price differential and some of that increases already in the July imports data, which is already public. But going forward, I would expect there is more butter from the US making its way to Australia.
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What Kathleen chart of the week. What do we have in store this time around?
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Well, we’re going to go with U.S per capita cheese consumption. This is a chart that Voko put together. So again our data wizard Vuko is coming in hot with these great charts week after week. USDA data and our estimates peg us per capita cheese consumption at around 17.5 kilos per person for the rolling 12 months ending July 2025.
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That’s down about a percent from the prior year, and down about a half a kilo from the February 2023 peak. People are just eating less cheese in the US, and I wish I had a great sense for why people are suddenly eating less. Maybe it’s GLP one type, drugs which seem to be cutting into people’s appetites. Food service demand here in the US over the last year has been sluggish at best, and we’ve certainly seen pullback in traffic there.
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Maybe we’ve hit max pizza. It’s it’s hard to pinpoint why we’ve started to see this pullback. But ultimately I think this does have some pretty significant ramifications as we look at the U.S demand picture for cheese specifically. And in turn the need to continue to focus on growing exports, especially in light of expanding cheese production capacity and expanding milk production in the States.
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Yeah, and getting that half a kilo decline that we’ve seen since February 2023 on an annual basis. So such a large population translates to about 170,000 tonnes. Obviously, the export market can’t absorb the whole volume, which means if demand doesn’t pick up, there’ll be a stock built in the US balance sheet.
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Pretty significant numbers there. That’s it for chart chatter this week. A huge thanks to Vuko for his data wizardry, and to Nana and the marketing team for mixing and mastering. If you’d like to learn more about how the ever I insights team can help support your business, or if you have chart requests, please contact us at Insights at Ever AG.
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