Class III, II, and IV prices all plunged in October 2025, forcing Uniform Blend Prices down across the entire Federal Milk Marketing Order system.
Dairy producers operating within the United States’ Federal Milk Marketing Order (FMMO) system are facing significant market deterioration as Uniform Milk Prices—the minimum blend price paid to farmers—fell sharply in October 2025. Crucially, this decline was system-wide, affecting all 11 regional FMMOs, indicating a broad-based weakness in commodity values rather than isolated regional market pressure. This sweeping drop confirms that the price declines were driven by substantial month-over-month decreases in the federally announced Class II, Class III, and Class IV prices for the period.
The most severe declines were concentrated in the manufactured product categories. The Class IV price, which is tied to the value of butter and nonfat dry milk, saw the steepest drop, decreasing a significant $1.87 per hundredweight (cwt) to settle at $14.30/cwt. Similarly, the Class II price, which governs milk used for soft products like yogurt and sour cream, experienced a pronounced loss, falling by $1.37/cwt to reach $16.02/cwt. These significant drops signal considerable pressure and reduced profitability within the global dairy commodity export and secondary processing sectors.
Price volatility also hit the cornerstone of the US dairy economy, the cheese market. The Class III price, which sets the minimum value for milk used in hard cheeses, declined by $0.68/cwt to $16.91/cwt for the month. Although the magnitude of the Class III drop was less severe than those seen in Classes II and IV, the reduction confirms headwinds for domestic and international cheese sales and inventory movement. The fact that all major manufactured classes saw reductions underscores a weak pricing environment entering the final quarter of the year.
The Uniform Milk Price, often referred to as the blend price, is calculated as the weighted average of the actual sales volume across all four milk classes (I, II, III, and IV) within each regional FMMO pool. Because the prices for Class II, III, and IV all recorded substantial drops—particularly Class IV—the resulting blend price paid to dairy producers was negatively affected across the entire country. This unified decline in the blend price for all 11 orders illustrates the pervasive impact of depressed commodity markets on overall farm profitability.
In summary, the October 2025 FMMO price announcement serves as a sobering indicator for the dairy sector. The simultaneous decline in all milk class prices resulted in the guaranteed uniform price falling in every marketing area. This market data confirms that milk producers are currently operating in a challenging pricing environment, where the returns for fluid, soft, and hard manufactured dairy products have all compressed, requiring producers and analysts to anticipate a sustained period of lower revenue.
Source: Access the full market details on the FMMO price collapse in AgProud.
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