Cheese Stockpile in America Reaches All-Time High

The U.S. has accumulated its largest cheese stockpile in the past 100 years since regulators starting keeping tracks. This is the result of strong domestic milk production and the waning interest of consumers in the dairy drink.

The cheese stockpile of 1.39 billion pounds, counted a week ago by the Department of Agriculture, represent an increase of 6% over the same time one year ago and an increase of 16% since a surplus from earlier prompted a cheese buy-up by the federal government in 2016.

Analysts said that stocks in commercial warehouses have swelled due to processors having far too much milk and milk is much easier to store when in the form of cheese.

The demand for milk has fallen as cafeterias in schools close for summer vacation and restaurants end their specials that include large amounts of cheese that are offered during the winter as well as early spring.

Many have become concerned that the stockpiles would grow even more if the trade tensions with Mexico and China hurt exports of cheese. Price of cheese has dropped sharply eroding the already thin margins for dairy farmers.

Cheese surpluses usually grow during this point of each year. Cows are most productive during the spring, when the days become longer and they feed better. Americans usually eat much less cheese during the spring and early summer than during the winter holiday, the school year as well as the sports season in winter.

However, the surpluses during the summer have grown larger, as better genetics result in cows producing more milk, and the industry’s consolidations means that farms have more cows.

Not able to sell that extra milk in both pints and gallons, which is being abandoned by Americans, processers convert it to milk powder, butter and cheese.

Analysts in the industry believe the cheese surplus will continued to grow as more milk is being produced it is inevitable that milk must be turned into something that can be stored.

However, the quantity of cheese currently in storage could cause problems. Prices of cheese have dropped tremendously the last few weeks, which analysts say is a response to both surplus as well as growing concerns over trade.

The fall in prices becomes problematic said a dairy policy analyst, because the price of cheese is the biggest factor in the equation the USDA uses to set prices the dairy farmers are paid for milk they sell.