2025 Dairy Industry Report: What It Means for Producers—And How AGPROfessionals Can Help

The 2025 State of the Dairy Industry report produced by Farm Journal presents a picture of cautious optimism within the U.S. dairy sector. Despite persistent challenges, such as labor shortages, regulatory burdens, market volatility, and rising input costs, many producers are planning to expand, diversify, and adopt new technologies. At AGPROfessionals, we recognize the need for strategic, resilient support across these evolving areas, and we're here to help producers capitalize on opportunities while navigating risks.

Optimism in Dairy, But Challenges Persist

Based on a nationwide survey of 400 producers, the report reveals:

· This year 74% anticipate making a profit

• In the next five years, 44% plan to expand
• More than half (57%) are optimistic about the future

However, this encouraging outlook is tempered by key concerns:

• Rising inflation and cost of materials
• Ongoing labor shortages
• Complex and evolving regulatory compliance
• Limited succession planning, with only 41% of operations having a defined strategy

Strategic Solutions for a Complex Landscape

AGPROfessionals brings decades of experience in agricultural real estate, land use planning, civil, agricultural, and geotechnical engineering, environmental compliance, planning and permitting, facility development, and project supervision, which are services that align precisely with the challenges and opportunities presented in this year’s report.

1. Expansion Support: From Land to Permits

With nearly half of dairy producers looking to expand, AGPROfessionals is equipped to help with:

• Agricultural land acquisition and zoning guidance
• Site design, engineering, and infrastructure planning
• Permitting assistance, including local, state, and federal requirements

We specialize in guiding producers through the permitting and development processes, including site layout and design, Confined Animal Feeding Operation (CAFO) compliance, stormwater plans, nutrient management plans, and more. To learn about how we have helped our clients achieve their goals, visit our featured projects section on our website.

2. Labor-Efficient Design and Operational Optimization

Labor remains a significant constraint for dairy operations. According to the report:

• Electronic collars and tags, which can help reduce the labor involved in monitoring and collecting data about animal health and well-being, are being utilized by 58% of producers.
• Data integration software is another helpful tool that can reduce labor costs. In the next 3-5 years, 33% plan to adopt the use of this software.

AGPROfessionals assists producers with efficient site layout planning, automation-friendly infrastructure, and modernization strategies to increase efficiencies, ease labor demands, and ultimately reduce operational overhead.

3. Diversified Revenue Streams: Energy and Land Use

There are various ways producers can diversify their income streams, ranging from transitioning to beef-on-dairy operations to offering niche products and energy generation. At AGPROfessionals, we can help producers diversify through:

• Renewable energy projects
• Oil and gas permitting support
• Land use planning that aligns with both production and revenue diversification
• Marketing niche products via our communications and marketing team

4. Compliance with Environmental and Agricultural Regulations

Dairy operators face increasing scrutiny in areas like manure management, water usage, stormwater runoff, and other environmental impacts. AGPROfessionals offers trusted expertise in:

• CAFO permitting and compliance support
• Nutrient Management Plans (NMPs)
• Stormwater and erosion control systems

We help producers meet environmental standards while protecting operational efficiency and profitability.

5. Planning for the Next Generation

With nearly 25% of producers planning to retire within the next five years, proactive succession and operational continuity planning are crucial. While AGPROfessionals does not offer legal services, we support dairy families with:

• Facility assessments and infrastructure planning
• Strategic land use and development consultations
• Insights on operational scalability for future generations

We aim to ensure the physical operation is positioned to thrive, whether it remains in the family or transitions to new leadership.

AGPROfessionals: Partnering for Progress

The dairy industry stands at a pivotal crossroads—brimming with opportunity but layered in complexity. As the 2025 report makes clear, success will belong to those who adapt with strategic foresight and strong partnerships.

AGPROfessionals is proud to walk alongside today’s producers, helping to overcome obstacles and embrace innovation. Whether you’re expanding, diversifying, or modernizing, our team provides the insight and expertise needed to grow your operation and secure its future.

Learn more about how AGPROfessionals can support your dairy's success at www.agpros.com.

Dairy Herd Management article HERE

Link to Download the Report HERE