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Under new Federal Milk Marketing Order rules, make allowances for processors rose to 23-27 cents per pound from 5-7 cents, cutting the milk price in Class III and IV formulas. Upper Midwest producers, whose regions are heavy with cheese plants, are seeing mailbox prices lower than before the changes.
Three of the seven formula updates take effect Dec. 1.
Higher make allowances lower the minimum farm milk price, reducing dairy producers' margins and potentially their herd and feed-buying capacity. The effect is a sustained cut in milk value rather than a short-term price shock.
dairystar.comMichele Ackerman Staff WriterSep 27, 2025After 24 past bearish policy events, Milk (Class III) moved a median -0.1% over 5 sessions (33% higher; middle half -1.8% to +0.5%), and -4.6% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
