National Milk Producers Federation

Why Dairy Is Dominating: America's New Billion-Dollar Ag Success Story

Wed, 08 Oct 2025 11:33:04 GMT

The U.S. dairy industry is in the midst of a record-breaking boom — fueled by premium beef-on-dairy calves, historic investments in processing plants and surging demand for protein both at home and abroad.

Beef-on-Dairy: A Revenue Stream That’s Reshaping the Market

Dairy farmers across the U.S. aren’t just milking cows — they’re tapping into a lucrative side market. Record cattle prices are giving rise to “beef-on-dairy,” a crossbreeding trend that’s bringing in premium prices and reshaping the value chain.

“I think it is an enormous revenue stream for dairy farmers,” said Gregg Doud, president and CEO of the National Milk Producers Federation (NMPF). “The number I hear is about $1,400 for that black day-old calf. As the old beef guy, I think that’s going to be there for at least another year or so — maybe more.”

The result, Doud says, is the dairy industry is “hitting on all cylinders,” as dairy producers capitalize on strong beef genetics and elevated cattle values to diversify income.

New Wave of Investment

At the same time, the U.S. is seeing a level of investment in dairy processing never before witnessed in American agriculture.

“It really is $10 billion — 2023, 2024, 2025, 2026 — in new dairy processing investment in the U.S.,” Doud said. “There’s nothing like it in the history of U.S. agriculture, of any commodity, anywhere in the world.”

Dairy’s $10 billion in investment in dairy processing over the next three years spans across the country.

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According to Michael Dykes, president and CEO of the International Dairy Foods Association (IDFA), more than $11 billion is flowing into 53 new or expanded dairy manufacturing facilities across 19 states, from New York to Texas to Idaho. These projects are slated to come online between 2025 and 2028.

“Investment follows demand,” Dykes says. “It’s phenomenal — the scale and scope of what’s happening right now.”

Production Rising to Meet Global Appetite

Farmers are responding to those signals. USDA data shows U.S. milk production is up nearly 5% year over year, and the agency projects another 27 billion pounds of milk by 2034.

Exports have also surged, reaching a record $8.2 billion last year.

“I can’t tell you how many meetings I went to where people said, ‘We’re scared to death there won’t be enough milk,’” Dykes recalls. “I said, don’t fret for one moment — dairy farmers hear the market calling for milk. Milk will come.”

America’s Dairy Demand Hits Record Highs

Domestic demand is booming too. Americans are consuming an average 661 pounds of dairy per person per year — the highest ever recorded.

“Cheese is driving the bus,” Dykes said. “We’re eating about 42 pounds of cheese per person per year — and pizza has clearly contributed to that.”

But it’s not just cheese. Butter, yogurt, premium ice cream and even milk itself are seeing renewed strength.

“Milk has been trending downward for the last few years,” Dykes said. “But even last year, milk took a turn up — led by whole milk, high-protein milk and lactose-free options.”

The Protein Craze Powering Dairy’s Momentum

Behind this surge is one key word: protein.

“The demand for protein globally is unbelievable,” Doud says. “Everywhere I go, I tell people — we’re having a moment here on the dairy-side of the equation.”

Doud notes dairy’s protein-rich products — from cheese to whey — are meeting consumer demand both domestically and internationally.

“We’re up 2% this year in volume, 16% in value,” he says. “Global demand for dairy is rolling, and we are right in the hunt.”

Dykes agrees, pointing out the “protein craze” isn’t just helping beef and pork — it’s boosting dairy too.

“Most of the products that have ‘protein added’ are dairy-derived proteins, like whey from cheese plants,” he says. “Consumers globally cannot get enough protein. Dairy has a protein that’s highly digestible and fits perfectly with the health and wellness mood of this country. We’re even adding protein to ice cream.”

A Growing Industry with a Rural Footprint

The dairy industry’s impact stretches far beyond store shelves. Dykes says the U.S. now has 1,200 processing plants, employing 3 million people, generating $200 billion in wages and paying $83 billion in state and local taxes.

“These plants are going into rural communities — where the milk is produced,” Dykes adds. “That’s where the jobs and opportunities are being created.”

Texas, South Dakota and Kansas are seeing the largest waves of new investment, with New York emerging as a new processing hub.

Labor: The Industry’s Biggest Challenge

Even with growth on nearly every front, one major hurdle remains: labor.

“The administration is working on short-term solutions through the Department of Labor — mainly H-2A or seasonal programs,” Doud explains. “But that really doesn’t do anything for us on the dairy side because we need year-round help.”

He says lasting change will require Congressional action.

“We have to have Congress change the law,” Doud says. “House Ag Committee Chairman G.T. Thompson is working on this, but it’s a big lift. We always get stuck on the 60-vote issue in the Senate. We’ve got to make another run at this.”

Doud remains hopeful a political breakthrough could come — much like the immigration reforms of the late 1980s — to finally deliver a sustainable labor solution for dairy.

America’s Dairy Future

From booming exports to billion-dollar investments, the dairy sector is on a trajectory few could have predicted a decade ago. Industry leaders say if trade and labor challenges can be addressed, the U.S. will continue to cement its place as a global dairy powerhouse for years to come.

“We’re hitting on all cylinders right now,” Doud says. “And if we can keep that momentum going, there’s no limit to how far U.S. dairy can go.”

Celebrating World Milk Day and the Farmers Who Make Its Enjoyment Possible

Tue, 04 Jun 2024 12:38:10 GMT

By Rory Christie: Newton Stewart, Scotland, United Kingdom

Nobody drinks or eats the soil—but the quality of every glass of milk begins with the health of the soil, including the efficiencies that farmers can put into it and draw out of it.

As we approach World Milk Day on June 1, we should celebrate a nutritious beverage. At the same time, this is an opportunity to recognize the farmers who make its enjoyment possible and everything that goes into what they do.

When people think about dairy farmers, they tend to think about the milking of cows. That makes sense. On my farm in Scotland, we manage a herd of more than 1,100 milking cows. These animals and milk they produce are at the heart of our business.

Yet successful dairy farming requires more than cows. It starts with the soil and its blend of minerals, moisture, and microorganisms. We invest a significant amount of time and energy on keeping it optimal. This has been true for as long as we’ve farmed, but we’re always updating our knowledge and techniques and adapting to circumstances.

Soil in optimum health supports healthier crops, which means heathier cows producing nutritious milk.

Here’s an example. To make sure our cows have good forage for grazing, we used to plough 300 acres per year. Then we discovered new technologies that have allowed us to eliminate our ploughing almost entirely. Instead of ripping up the ground when we put seeds in the soil, we now use a method of direct drilling for our grass and cereals. This keeps disruption at a minimum—and boosts the soil’s health.

We have always worked hard to manage the soil’s acidity, which we measure in units of pH , from zero to 14. The lower the number, the higher the acidity. Two decades ago, we aimed for a pH of 5.2 to 6.0. Today, with our direct drilling, reduced artificial fertilizer use and variable-rate lime spreading, we try to achieve 6.7 pH, which is almost exactly in the middle of the scale—and a level that allows us to cut back on inputs even as we grow the same amount of grass or more.

That’s the first benefit. There are plenty of others.

When heavy equipment moves across fields, it compacts the soil structures that allow roots to thrive. Because we’ve limited our tillage, we now drive our tractors less and thereby reduce compaction. We’ve also cut back on our use of fuel. That’s an economic savings for us that also decreases our farms greenhouse gas emission.

Growing more grass means we’re doing a better job of promoting the biogenic carbon cycle , which involves taking carbon from the atmosphere, where it poses a problem, and putting it in the soil, where it contributes to the flourishing of plants. This is an important part of sustainable agriculture. With smart policies, it could even create a new gold rush for farmers.

We’re also trying to breed better cows, based on traits such as milk volume and quality. We take the calves from the cows in the top 25 percent and use them to replace the cows in the bottom 25 percent as we cull the herd. We’re one of the first dairy farms to do this with crossbred milking cows and we believe it will introduce even more efficiencies into our operation.

Our farm also is committed to renewable energy. We have installed 250 kw of solar panels and our wind turbine adds another 33 kw. We don’t have a connection to the national electricity grid because right now it is economically prohibitive to buy one. Because we must use everything we produce, we continue to invest in power balancing and put considerable thought and effort into setting up systems that use our power efficiently. This investment in renewable energy has cut our electricity costs by 30 percent.

My experience as a dairy farmer has taught me that economic and environmental goals are not at odds with each other. Instead, they are often symbiotic. As our carbon footprint shrinks our profits rise because we’re becoming more efficient with our resources. We can always do better: If supply chains and consumers were to appreciate that food prices should reflect more than merely the cost of production, farmers like me would have new capital to invest in the soil, biodiversity, and renewable energy.

My hope is that drinking and eating our nature-friendly milk and cheese gives you a delicious and healthy diet—and it helps me do well by doing good.

Rory Christie is part of a progressive and innovative family-run business that specializes in pastoral dairy and intensive pig production in Scotland. Rory is a member of the Global Farmer Network. www.globalfarmernetwork.org

Big News: House Passes Bill to Bring Whole Milk Back to School Menus

Thu, 14 Dec 2023 16:30:24 GMT

More than a decade after banning whole and reduced-fat milk from being served during school lunches, the House of Representatives overwhelmingly voted in support of the Whole Milk for Healthy Kids Act, which passed late on Dec. 13. The bill revises the requirements for milk provided by the National School Lunch Program of the Department of Agriculture (USDA).

In 2012, USDA updated school meal requirements to reflect the most recent Dietary Guidelines for Americans at that time. The update included restricting school milk choices to unflavored low-fat, flavored fat-free and unflavored fat-free. Milk consumption in schools dropped significantly as a result.

In 2017, USDA allowed exemptions to school nutrition standards so they could serve flavored low-fat (1%) milk. USDA implemented those standards, which were in place when the pandemic hit, and continued allowing flexibility in the program to ensure schools could offer nutritious meals amid pandemic-related supply chain issues.

Currently, schools participating in the National School Lunch Program require milk to be fat-free or low-fat and allow milk to be flavored or unflavored. However, the Whole Milk for Health Kids Act modifies these restrictions and instead permits schools to offer students whole, reduced-fat, low-fat, and fat-free flavored and unflavored milk.

“Milk is an essential building block for a well-rounded and balanced diet, offering 13 essential nutrients and numerous health benefits. However, out-of-touch and outdated federal regulations have imposed restrictions on the types of milk students have access to in school meals,” says Rep. GT Thompson, chairman of the House Agriculture Committee who introduced the act along with Rep. Kim Schrier earlier this year. “I am pleased to see my bipartisan Whole Milk for Healthy Kids Act pass out of the United States House of Representatives, and I ultimately look forward to restoring access to these nutritious beverages in schools across the country.”

From coast to coast, well-known figures in the dairy industry offered their praises on the bill’s passage.

“NMPF applauds Representatives Glenn “GT” Thompson and Kim Schrier for their leadership in increasing students’ access to crucial nutrition with their Whole Milk for Healthy Kids Act. This bipartisan measure helps address kids’ underconsumption of the vital nutrients milk provides. This bill allows schools to offer students healthful milk options that they are more likely to choose to drink by expanding the milk options schools can choose to serve to also include the most popular and also nutritious reduced fat and whole milk varieties. NMPF thanks Representatives Thompson and Schrier for spearheading this bipartisan, commonsense, widely supported solution to address students’ nutrition insecurity across the U.S.” – Jim Mulhern, President and CEO, National Milk Producers Federation

“IDFA applauds the strong bipartisan passage of the Whole Milk for Healthy Kids Act by the U.S. House of Representatives. This bill would allow schools to once again provide children with a wide variety of milk options that they will drink and that meet their individual needs—whether that be whole and 2%, low-fat milks, or lactose-free milks. Whole milk and reduced-fat milks alike provide children with 13 essential nutrients for growth, development, healthy immune function, and overall wellness. A wide majority of parents and medical and nutrition professionals know that offering these options increases school meal participation, reduces food waste, and provides nutritionally valuable school meals for children and adolescents. IDFA is grateful to Chairman Glenn “GT” Thompson, Rep. Kim Schrier, and the many other lawmakers who for years have championed this effort to reinstate the full suite nutritious milk options in school meals. We strongly urge the Senate to pass this legislation.” – Michael Dykes, D.V.M., President and CEO, International Dairy Foods Association

Milk is an important building block for America’s children. Unfortunately, whole and 2% milk aren’t allowed in school lunch programs, limiting access to protein, calcium and vitamins at important times in children’s development. AFBF appreciates Rep. GT Thompson for his leadership on the Whole Milk for Healthy Kids Act of 2023, which will ensure schools can include all milk options to students.”– Zippy Duvall, President American Farm Bureau Federation

“Pennsylvania Farm Bureau members have waited for over a decade to see progress made on getting whole and two percent milk back in schools. Today, the House had a historic vote for the dairy industry by passing H.R.1147, the Whole Milk for Healthy Kids Act of 2023. Of course, our dairy farmers are going to see benefits of this legislation, but America’s students and families are also beneficiaries. School meals provide nutritional equity and food security. Low-income families who already are struggling to put dinner on the table, cannot afford to purchase the most expensive type of milk. However, medical research and pediatricians have attested that our children need the 21 essential minerals and 13 vitamins necessary for healthy development. We look forward to restoring nutritious beverage options in schools, growing the current pool of fluid milk consumers, and making the dairy industry more profitable for years to come.” – Chris Hoffman, President Pennsylvania Farm Bureau

“Today is a win for the kids, for the people, for the farmers. Whole milk choice in schools is clearly an improvement for our nation’s future leaders. House passage of the Whole Milk for Healthy Kids Act is a milestone we have worked for over the past decade since the federal government exiled whole milk, a nutritionally superior beverage choice, from school cafeterias based on outdated science. Over this time, we have seen school milk consumption decrease while volumes of discarded milk have increased along with the overweight and obesity trends in school-aged children. When students are able to choose milk they will love, they are then able to truly benefit from milk’s 13 essential nutrients and unique matrix for health. We can’t thank Chairman G.T. Thompson enough for his dedication in championing the idea that schools should be free to offer, and parents and children should be free to choose whole milk at school meals. In our educational outreach, we hear from school personnel, parents, and students, who are excited to be one step closer to nourishing growing minds and bodies with the nutritious and delicious option of whole milk.” – Bernie Morrissey, Chairman of the Grassroots Pennsylvania Dairy Advisory Committee and G.N. Hursh, Chairman of 97 Milk

“I’m delighted to see this change, which is backed by the most rigorous science showing that regular dairy is the healthiest for growing children. This law is a rare instance in nutrition where good science has triumphed over special interests.” – Nina Teicholz, Founder of The Nutrition Coalition

“We are pleased to see the Whole Milk for Healthy Kids Act gain passage in the House of Representatives. As farmers, we produce a wholesome product that our nation’s children should be able to choose. We thank Rep. Glenn ‘GT’ Thompson for his diligence toward the goal of students having the freedom to choose whole milk at school and making it possible for schools to offer this nutritional choice without the fear of losing federal meal and education dollars. Scientific evidence supports fuller fat milk and dairy as an excellent source of vital nutrients and other health benefits. While the natural milkfat aids absorption of key vitamins, it also brings flavor to the table so students can enjoy and benefit from all that milk has to offer them.” – Walt Moore, Chairman of American Dairy Coalition

“Milk is an essential part of a balanced diet, especially for our growing children,” said. “Milk’s nutritional benefits for school-age children have been proven time and again, and offering expanded options encourages consumption of nutrient-dense milk. Thank you to Reps. GT Thompson and Kim Schrier for their unwavering support and leadership to ensure that fuller-fat dairy products are recognized as healthy options, especially for school nutrition programs. We urge the Senate to take up their companion bill ASAP.” – Edge Dairy Farmer Cooperative President, Brody Stapel