As we continue through the new year, U.S. dairy is entering an exciting phase marked by growth and opportunity. The category is experiencing a renaissance, with public figures – including celebrities and other influencers – championing whole milk.

Retail data from 2024 further underscore this momentum, with strong sales performance across almost all categories, particularly in cheese, butter and yogurt. However, while the numbers are promising, U.S. dairy faces many uncertainties related to labor, weather extremes and trade.

The longer-term forecast for U.S. dairy is positive. However, in the short term, competition for milk and markets will intensify, and supply and demand dynamics may result in winners and losers. Farmers and processors are leveraging innovative technologies, business diversification and vertical integration to position themselves for success. This optimistic mindset has prompted unprecedented investment in new and expanded manufacturing capabilities, with $8 billion now committed to infrastructure, including farm-based and farmer-owned operations.

This focus on infrastructure development is critical for ensuring the future competitiveness of U.S. dairy in both domestic and international markets.

Last year marked a pivotal time for the checkoff-founded Innovation Center for U.S. Dairy. We demonstrated our collective strength by driving tangible results across multiple initiatives that will set the course for future growth. 

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Some of the year’s most notable achievements included:

  • Sustainability milestones: Reporting by the U.S. Dairy Stewardship Commitment’s 34 adopters proved that productivity and progress go hand in hand. Results indicate a 9% increase in dairy plant production while reducing energy use intensity by 5%, greenhouse gas (GHG) emissions intensity by 4% and water withdrawal intensity by 20%.
  • Strengthening dairy’s health position: The launch of the U.S. Dairy Health & Wellness Playbook equipped industry communicators with science-backed messaging to promote dairy’s role in modern wellness.
  • Deepened consumer trust: Programs like the “Dairy Diaries” docuseries led to a 60% increase in respect for dairy farmers, while the second year of “See Dairy Differently” drove a 9-point lift in trust.
  • Expanded access: U.S. dairy distributed 1.5 billion servings of dairy through Feeding America, a 9.6% increase over the previous year.
  • Crisis management: During the highly pathogenic avian influenza (HPAI) outbreak, the industry maintained strong consumer trust and retail sales through proactive outreach, education and communication.

These efforts reflect the strength and resilience of the U.S. dairy sector. We also recognize that challenges remain. Farmers and processors must continue to navigate escalating costs, heifer shortages, lending and other growth constraints. There also is uncertainty in the areas of trade, immigration and health guidance that could impact future growth.

On the positive side, there is significant momentum toward innovation and collaboration. In 2024, U.S. dairy made notable strides in advancing sustainability through updated programs like Farmers Assuring Responsible Management (FARM) Environmental Stewardship, a new comprehensive life cycle assessment and strategic roadmap to GHG neutrality. These initiatives will continue to guide our path forward.

In the coming months, we will focus on critical research and insights to guide future strategy. The U.S. Dairy Materiality Assessment, our third such evaluation in the past decade, will help us prioritize sustainability and social responsibility initiatives. The State of the Industry Report, commissioned by Dairy Management Inc. (DMI), will provide a detailed outlook on U.S. dairy supply growth and demand scenarios through 2030, helping to shape both domestic and international strategies. Additionally, the Consumer Foresight Study will look at cultural trends and long-term consumer expectations, identifying key drivers of growth, including the rise of food as medicine, AI advancements and climate change impacts.

These studies will inform the strategic plans of both dairy checkoff and the Innovation Center for U.S. Dairy, ensuring that U.S. dairy remains aligned with consumer needs and industry trends.

As we reflect on the work we have done and the challenges and opportunities ahead, it is important to recognize the crucial role that collaboration plays in our success. The Innovation Center has been a catalyst for aligning industry stakeholders and setting a shared agenda for the last 17 years. 

Our membership is committed to working together in a pre-competitive manner in areas of common interest – advancing sustainability, building consumer trust or improving our positioning in global food systems – that have been fundamental to U.S. dairy’s ongoing success.

We have built a solid foundation for the future – one based on collaboration, resilience and a shared vision of progress. As we build on our momentum in 2025, I am confident that U.S. dairy is poised for success in the years to come.

This article was written by Barbara O'Brien, who is president and CEO of DMI and the Innovation Center for U.S. Dairy. To learn more about your national dairy checkoff, visit our website or to reach us directly, send an email.

About the Innovation Center for U.S. Dairy

In 2008, America’s dairy farmers and industry leaders created the Innovation Center for U.S. Dairy, a forum to advance knowledge sharing, commitment and action within pre-competitive priorities. The founders understood that our industry is stronger when we work together across the dairy value chain to gather our collective input, resources and expertise to address issues and opportunities that matter to our category, and the dairy buyers and consumers we serve.  

The center convenes hundreds of members of the dairy community, all committed to contributing to the long-term viability of the U.S. dairy industry. The organization is led by a board of chief executives and chairs of dairy companies and associations. The farmer cooperatives and processors on the board represent about 65% of U.S. milk production and associations include DMI, International Dairy Foods Association, Milk Processor Education Program, National Milk Producers Federation and the U.S. Dairy Export Council.

To learn more about the Innovation Center, visit the website.