Yet temporary programs and one-time payments won’t be enough to keep this industry alive. Finally, the USDA is providing farmers $19 billion in aid via Congress’ $2.2 trillion economic aid package. The agency has also committed to purchasing hundreds of millions of dollars of dairy products throughout the rest of the year. Thankfully, the USDA is providing some temporary relief through direct payments to dairy farmers to help offset this year’s losses. So farmers are the only ones in the dairy supply chain who can’t adjust their prices based on market conditions. Making matters worse, the US Department of Agriculture sets raw milk prices directly. As restaurants open up, prices are slightly rebounding, but farmers are still grappling with low demand and years of low prices. At the height of the pandemic, milk prices had fallen nearly 50% since Thanksgiving. Surviving farms had high hopes for 2020, but then Covid-19 came along and crushed demand. And between 20, the nation lost over 3,280 farms, the largest annual decline in 15 years.įarmers won't see coronavirus money until June as bankruptcies soar Between 20, the number of dairy farms fell by more than 50%. Between 20, milk prices declined by nearly a quarter, forcing many farms out of business. But if this continues much longer, many farms won’t survive. Given these supply chain woes, a growing number of farmers have little choice but to dump their milk. That million-dollar endeavor would be difficult even without a pandemic going on.
Producing the eight-ounce bags of shredded cheddar that grocery stores sell – instead of the 10-pound bags that restaurants purchase – would require retooling an entire processing plant. Similarly, packaging dairy products for retail use is a much different process than packaging it for schools, restaurants and other high-volume buyers, many of which have been shut down during the pandemic. And establishments like food banks and homeless shelters can’t take excess milk, as they aren’t prepared to handle high-volume deliveries.
#Horizon milk shortage 2021 full#
The trucks that transport milk to retail locations are already operating at full capacity. Yet, we can’t sell the milk directly to them. This triple-punch has left farmers with an unanticipated milk surplus and no place to store it.Īs Covid-19 caused consumers to panic purchase milk, many retail outlets struggled to keep milk in stock, and some stores limited how much customers could buy. And third, cows produce milk at the fastest rate this time of year, since many cows give birth in late winter and spring pastures are high in nutrients. Second, since under-milking signals their bodies to halt production, cows must be milked every morning and evening – regardless of whether buyers are capable of taking delivery.
But the dairy sector is particularly vulnerable, for three reasons.įirst, dairy products are highly perishable. Without long-term federal relief, dairy farmers won’t be able to stay afloat.Ĭovid-19 has sent shockwaves through nearly every industry. Unfortunately, the crisis could soon worsen. So they have no choice but to dump millions of dollars of milk. But cows still need to be milked twice a day, and farmers only have limited storage facilities. Our packaging and trucking partners don’t have the capabilities to immediately reroute milk, cheese and other dairy products from restaurants and schools to grocery stores or food banks. The disconnect is due to unprecedented disruptions in the supply chain. It’s time to start crying over spilt milk.Įvery day, US dairy farmers are forced to dump as much as 3.7 million gallons of fresh milk – even as grocery stores report milk shortages and millions of jobless Americans go hungry.
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