U.S. Milk Output Leads Global Growth into 2026

U.S. dairy producers remain the primary growth engine globally, while tightening supplies in Europe and New Zealand could support export demand for American dairy products.

WTFCF_S4E3_BTS_3_hickory-hill-milk_bottling-plant_1920x1080.jpg

The bottling line at Hickory Hill.

The bottling line at Hickory Hill. (Photo by Donna Sanders, Where the Food Comes From)

NASHVILLE, Tenn. (RFD-TV) — U.S. milk production is expected to expand again in 2026, outpacing most major exporters and reinforcing America’s role as the primary driver of global dairy growth, according to the USDA’s latest Dairy: World Markets and Trade report. USDA forecasts U.S. milk production at 106.2 million metric tons, up 1.2 percent from 2025, accounting for most of the net increase among major exporting countries.

The growth reflects continued herd expansion and rising processing capacity in the United States. Strong cheese demand and solid export performance are pulling more milk into plants, encouraging producers to add cows despite higher capital and labor costs. U.S. output gains more than offset modest production declines expected in the European Union and New Zealand.

Outside the U.S., production trends are mixed. Argentina is forecast to post the largest percentage gain, up 4.0 percent in 2026, as pasture conditions and feed availability improve following drought impacts in 2024.

Australia is expected to rebound 1.8 percent, supported by improved rainfall in southern dairy regions and relatively low feed costs, though long-term industry consolidation continues to limit expansion. Conversely, New Zealand output is projected to decline 0.5 percent, as declining cow numbers offset strong milk prices and export demand.

European Union milk production is also forecast to decline by 0.5 percent for the second consecutive year, as environmental regulations, disease pressure, and herd contraction outweigh gains in milk per cow.

Collectively, milk production among major exporters is expected to be 0.4 percent higher in 2026, with the United States accounting for most of the increase.

Farm-Level Takeaway: U.S. dairy producers remain the primary growth engine globally, while tightening supplies in Europe and New Zealand could support export demand for American dairy products.
Tony St. James, RFD-TV Markets Specialist
Related Stories
Rural population growth supports long-term stability of the ag workforce.
Feed demand and premiums drive growth for the crop
Purdue economist Dr. Joana Colussi discussed the U.S. and Brazil’s reliance on imported fertilizers and their impact on global food security amid rising input costs.
USDA Secretary Brooke Rollins plans a farm visit in Missouri, hinting at a possible fertilizer relief announcement on RFD-TV earlier this week. USDA also restructures its research infrastructure and launches new food-safety centers.
Dry conditions have severely impacted key winter wheat states with persistent moisture deficits. As quality declines, analysts warn some crops may be lost despite upcoming rain.
Rising ethanol stocks and softer gasoline demand bear watching, but stronger blending activity and exports offered some support.

Tony St. James joined the RFD-TV talent team in August 2024, bringing a wealth of experience and a fresh perspective to RFD-TV and Rural Radio Channel 147 Sirius XM. In addition to his role as Market Specialist (collaborating with Scott “The Cow Guy” Shellady to provide radio and TV audiences with the latest updates on ag commodity markets), he hosts “Rural America Live” and serves as talent for trade shows.

LATEST STORIES BY THIS AUTHOR:

Diversified risk tools help protect farm income.
Grain movement stayed active, with barges showing the strongest weekly gain while rail and ocean signals remained mixed.
The Supreme Court’s ruling could affect pesticide warning claims well beyond Roundup.
Bridge payments are helping, but many producers still face losses and tight margins. AEM’s Curt Blades joins us to discuss how the current farm economy is pressuring equipment demand.
Corn export demand remains supportive, but weak pork and rice sales show uneven global demand trends.
Rising poultry supply is pressuring prices despite steady demand.