Still, the economic outlook is much brighter than in the darkest days of the spring, and some of the most visible emblems of recent turmoil – namely negative Producer Price Differentials (PPDs) in milk checks – should soon fade.

Milk production growth in the nation has zigzagged this year from +1.3% in January, to +2.8% in March, to -0.5% in May and back to +2.0% in July. Other actors in dairy’s strange drama have been sales of dairy products at retail, which have been stronger than usual; use of dairy products in food service and institutions, which have been weaker than usual but fluctuating; government purchases of dairy products for food assistance use, which have been much larger than usual; and finally, government direct payments to dairy farmers, which have no recent historical precedent.

All this has led to wild fluctuations in average U.S. milk-price results as reported by USDA: $18.00/cwt. in March, $13.60 in May, and $20.50 in July. June and July also saw record high negative PPDs in federal orders, due to the interaction of the resulting unusual fluctuation of dairy product prices.