With milk prices plunging to lows that haven’t been seen in nearly four years, dairy cooperatives are dumping the product to reduce oversupply.
While shoppers are clearing out milk cases at grocery stores, that’s not making up for the closings of restaurants and schools.
U.S. cows are entering their most productive time of the year right now as coronavirus is killing off a significant tap for demand. While some dumping usually occurs during the country spring, this year it will be “even more aggressive,” said Alyssa Badger, director of operations at HighGround Dairy in Chicago.
“There’s no way to offset how much loss we’re seeing with school closings and food service demand in the form of cheese and butter, just because someone’s buying an extra gallon of milk,” Badger said.”
American dairy farmers have been suffering a wave of bankruptcies amid years of low milk prices, and with so many exiting — Wisconsin alone was losing two to three dairy farms a day for the past three years — the industry was just starting a recovery.
The onset of the virus has put any such turnaround on hold.
Benchmark Class III milk futures, a type that’s used in cheese-making, dropped below $13 per 100 pounds this week in Chicago, a low not seen since May of 2016.
Butter prices are crashing, with futures touching the lowest since 2012 amid huge stockpiles. Cheese is at the lowest in a year.
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While demand for dairy products initially surged due to consumers stocking up on staples, that has now dropped, said Kristen Coady, a spokeswoman for Dairy Farmers of America.
The cooperative is trying “all possible avenues to find a home” for their members’ milk, including donation opportunities at food banks.
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