The first big federal supply-and-demand estimate of the year landed with a bit of good news: the all-milk price forecast for 2021 moved up, with both of the major class prices revised higher on stronger product values. After the year we all just had, we'll take it. But a forecast is not a check, and there's a second number in the same report worth sitting with before anyone celebrates.
Two numbers, one herd
Milk production is running well above last year — the fourth straight month of year-over-year growth above 3%, with cow numbers still climbing. More milk chasing a recovering price is exactly the tension that determines whether 2021 actually feels better than it sounds. Nonfat dry milk and dry whey both firmed through the first half of January, which is one reason the forecast moved; whether that holds through spring flush, when supply typically runs heaviest, is the open question.
For a small or mid-sized cheesemaker, the price you see on a milk check is only half the story. Feed costs, packaging, and the labor market are all moving too, and a better all-milk number doesn't automatically translate into a better margin if your input costs are climbing at the same pace. If you haven't rebuilt your cost sheet since before the holidays, this is a reasonable week to do it — prices are moving enough that a stale number could be quietly wrong. The market report circulating this month also flagged nonfat dry milk and dry whey both firming through the first two weeks of January, which is worth watching if either shows up as an input on your make sheet.
Members who buy milk rather than run their own herd are in a slightly different spot: a rising all-milk price is good news if you're the one selling it, and a cost pressure if you're the one buying it downstream for a cultured or aged product. Either way, the number worth tracking isn't the headline forecast — it's how your own contract or co-op pricing formula actually responds to it, which can lag the federal number by a month or more.
The specialty case is still finding its footing
The retail side tells a slightly different story than the farm-level number. Specialty and artisan cheese sales held up better than a lot of members expected through the second half of last year, particularly for producers who leaned into direct-to-consumer and curbside sales when foot traffic dropped. That resilience seems to be carrying into the new year — several members on our January check-in calls described online orders holding steady even as some in-person retail slowly reopens.
That doesn't mean every segment is even. Smaller-batch, higher-price-point wheels are proving more durable than commodity-adjacent product, which tracks with what we'd expect: a customer trading down on everyday groceries is often still willing to spend on the thing they consider a treat. If your case skews toward that end, it's worth leaning into the story behind the cheese in your marketing this quarter, not just the price on the tag.
We'll have a clearer read once the February report comes out and we can see whether the spring flush is tracking ahead of normal again. In the meantime, if pricing your own product for the new year feels harder than it should, our course on Pricing & Margin for Specialty Cheese walks through building a cost sheet that actually holds up when milk prices move mid-quarter — worth a look before your next wholesale conversation.
The International Cheese Federation (ICF) and More Cheese are entirely fictional. This post is demonstration content created for MemberJunction. All people, organizations, events, courses, certifications, figures, and quotations in it are invented, and nothing here represents a real association, a real business, a real person, or real professional advice.