Why Consumers Are Soaking Up Dairy And Still Buying Beef

Today we focus on consumers with stories on how export and domestic demand is soaking up the extra milk production. Speaking of consumers doing their part, we turn to the beef market and dive into why the heck consumers are still paying a mortgage payment on ribeyes. We finish up with a quick look at a drop in oil prices. 

Transcript

SPEAKER_00 0:10

Hello and welcome to Chatby DC back with three quick news stories for you across a business. Today is Monday, June 1st. Hope everybody had a good weekend. Today we're going to focus on how consumer demand is keeping pace with milk production, then look at why consumers are still buying beef, and then a quick look at a drop in oil prices. So let's get to it. Starting out, we had a news report last week that showed how dairy production was riding a 16-month heater of year-over-year growth. Question is, is processing able to soak up that extra production? According to an article from Sarah Youngman on dairy herd management, consumers are doing their part. Demand has steadily increased with the higher availability of milk supply on a milk fat basis. Exports in the first three months of 2026 totaled just over 5,000 million pounds, about 40.6% higher than last year. On a skim solids basis, exports totaled 12,190 million pounds, about 5.7% higher than the same period for 2025. International demand is strong, especially for cheese and butter fat. Due to the quantity of use supply the U.S. has available, pricing is competitive, our production is rampant, so exports are expected to continue to increase as we move further into 2026. Domestically, use for all dairy products was also higher in the first quarter of the year on a milk fat basis. Domestic use was 52,719 million pounds, which is up 0.9% over the same period a year ago. On a skim solids basis, domestic use was 47,108 million pounds, up 3.3% from 2025. Dry skim milk products and whey protein concentrates have had the largest year-over-year increases, up 22% for dry skin milk production and 74% higher for whey protein concentrates, on par for the increasing demand for protein products. Domestic usage for butter and cheese has also increased from last year. However, domestic uses for dry whey and lactose have declined this year. Overall, with the export program thriving and domestic usage increasing for most products, the 2026 March ending stocks declined almost 6% on a milk fat basis and 5.7% on a skim solid basis. Butter, American cheese, dry skim milk, and whey protein concentrate stocks all declined year over year, despite the rising increases in production. Sticking with consumers, let's talk about beef. An article by Kalina Bruce on drovers. As we close on beef month and head into summer grilling season, one question keeps standing out. How is beef demand still so high, even as prices at the meat case continue climbing and consumers continue tightening their budgets? Well, it's no secret that today's cattle cycle has created challenges throughout the beef supply chain. U.S. cattle herd remains at historically high low levels, supplies are tight, and consumers are feeling pressure at the grocery store. According to the USDA Economic Research Service, wholesale beef prices were nineteen point seven percent higher in March twenty twenty-six than last year and are predicted to increase by seven point eight percent in twenty twenty-six. But consumers continue choosing beef. In fact, despite those higher prices, consumers increased both their spending and purchase volume during that same period. Over the four weeks ending April 19th, 2026, beef generated $3.56 billion in retail dollar sales, up 7.5% year over year and outpacing competing proteins like chicken and pork. That says a great deal about what consumers continue valuing most in their food purchases today. People genuinely enjoy the eating experience that beef provides. Whether it's a quick weeknight dinner or a meal shared during a special occasion, beef remains a product people look forward to eating. At the end of the day, consumers continue reminding us that taste still matters. However, they're also placing greater emphasis on protein and nutrition than in the past. And beef continues delivering the most nourishment and satisfaction any families are actively seeking. However, they're also placing greater emphasis on protein and nutrition than they have in the past. Beef continues delivering the nourishment and satisfaction that many families are actively seeking. Finishing up in financial markets, uh global oil prices have tumbled by around twenty percent from twenty twenty-six highs, as investors have grown increasingly optimistic on prospects for a long-lasting ceasefire between the US and Iran, which would unlock shipping through the Strait of Hormuz. Brent crude was down one point two percent on the final trading day of the month at ninety-two dollars and fifty-six cents. International price benchmark has plunged plunged almost nineteen percent in May, having suffered its worst month since the COVID-19 pandemic, and is now off about 20% from its 2026 peaks. Meanwhile, U.S. West Texas intermediate futures prices have fallen 16.5% month to date, and we're last seeing almost 1.9% lower on Friday at $87.18. Well, that's enough for now. As always, thanks for tuning in tuning into ChatBBC. If you found this useful, please subscribe and share and tell all your friends.