Kelsey Gee reported on Friday at The Wall Street Journal Online that, “Dairy farmers drowning in cheap milk begged agricultural officials on Friday to buy up tens of thousands of tons of cheese to help bail them out.
“Jim Mulhern, chief executive of the National Milk Producers Federation, asked U.S. Agriculture Secretary Tom Vilsack to buy $150 million worth of cheese to protect struggling dairy farmers and provide 90 million pounds of food to needy Americans.”
The Journal article noted that, “Milk prices for farmers have plunged 13% in the past year to around $1.25 a gallon, their lowest point since October 2009, amid a barnyard-wide glut in agricultural commodities from corn to cattle. Favorable weather at home and skyrocketing production globally have pushed down prices on staple grains as well as the milk and the meat of animals that feed on them.”
Ms. Gee explained that, “Dairy farmers have struggled to stay solvent as stockpiles of cheeses from cheddar to feta have swelled in June to a record 1.25 billion pounds. Cold-storage warehouses across the U.S. are socking away millions of pounds of cheese, some of which can be kept frozen for years, as dairy processors hold out for higher prices. In the past, the USDA has made similar purchases of peanuts and of chicken leg quarters after an avian influenza outbreak triggered an export ban that decimated U.S. poultry prices. Officials often distribute such surpluses to U.S. school-lunch programs or food banks.”
“U.S. farmers expanded their herds and flocks two years ago while prices were high and export markets were hot. This year, a strong dollar and growing milk production in Europe has made U.S. dairy products less attractive to foreign buyers. The surplus is filling up U.S. cold storage facilities just as a global commodity glut drags down prices for grains and meats as well,” the Journal article said.
