In a small bowl, add 1 cup warm water, 2 tablespoons sugar, and 2 teaspoons yeast. Combine and set aside.
In a large mixing bowl, add 2¾ cups flour, 2 tablespoons dry milk, and 1¾ teaspoons salt. Add 2 tablespoons softened butter and yeast mixture. Knead until a soft dough forms. Place dough in a lightly oiled bowl and turn to coat.
Cover with a clean cloth and let rise in a warm, draft-free area until double in size. Punch down dough and form a loaf. Place in a warmed Dutch oven prepared with nonstick cooking spray. Note: To warm a Dutch oven, place it in the sun or use 4 coals underneath the oven for a few minutes. You want it warm, not hot.
Cover with a cloth and let rise until double in size.
Cover with lid and bake at 350℉ for 40 minutes, or until golden brown, or using 10 coals underneath and 14 on top.