Galen: Dairy Economics Remain Solid

American farmers are facing a variety of challenges right now.  Tariffs are on and then off, then on again.  Prices for most commodities are down while input and labor costs are up.  Despite the headwinds, Chris Galen, senior vice president of member services and governance for the National Milk Producers Federation, said the dairy industry is doing fine.

“So far, so good. As we start the year, it looks like margins are still strong.  Part of that is, for better or worse, because feed grain prices - corn and soybeans, obviously - have not had a great year so far or the last six months or so.  So, if you're in the livestock business, as dairy farmers are, your input costs are lower because of the trough in the price for feed grains and oil seeds, and, in the meantime, the milk price has been strong," Galen said.  "Last year was a really good year for milk prices and margins, and we’re starting off on the same path, the same trajectory in 2025 and, at this point, looks to be still the case.”

However, if dairy loses export markets because of tariffs and retaliation, Galen said things will quickly change.

“Obviously, if the economy slows down, if we have a loss of export markets that extends, you know, for months or years, then is a different ball game.   But for now, we're looking at better times, or, at least, continued good times in 2025.”

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