Global events are once again proving their influence on agriculture markets, and according to EverAg’s Jan Prins, the ongoing Iran conflict is creating ripple effects across the dairy industry, especially when it comes to exports.
Prins explains that while many may not immediately connect geopolitical tensions to dairy, the impacts are real and measurable. “When the conflict first started, the immediate reaction was like, okay, what products is that going to affect in our dairy markets? And it seems to have mostly affected our butter, specifically our butter exports,” he said. Early on, canceled orders and rising shipping and insurance costs put significant pressure on U.S. butter markets, contributing to price volatility.
The situation doesn’t stop there. Because both the U.S. and European Union export butter to the Middle East, disruptions abroad are also influencing global pricing dynamics. As EU butter prices face pressure, that trickles down into cheese markets as well—an area where the U.S. is heavily dependent on exports. “As EU cheese has been rallying, U.S. cheese has followed along… meaning our price ceiling raises as EU cheese raises,” Prins noted, emphasizing how closely tied the markets have become.
Back home, milk production in the U.S. is rebounding, with growth of 3–4% reported in recent months. However, that growth isn’t evenly distributed. Western states like California are seeing a surplus of milk, while eastern regions are struggling to meet demand. This imbalance is adding another layer of complexity to an already volatile dairy market.
As global uncertainty continues, dairy producers and traders alike are keeping a close eye on both international developments and domestic supply trends that could shape pricing in the months ahead.
