Dairy Industry Rebounding from Epic Decline, Demand Increasing

ARLINGTON, VA – During the early days of the coronavirus pandemic and economic shutdown, stories emerged of dairy producers having to “dump” milk due to a lack of demand and more importantly, a supply chain bottleneck that kept processors from taking delivery of milk from dairies.

Some 18 months later, U.S. dairy-product demand has achieved near record highs as a percent of milk solids production in 2021 and wholesale prices for butter, nonfat dry milk, and dry whey (during the month of May) were all higher than before the pandemic began.

Domestic milk production has been increasing, pressuring milk prices since early May, but year-over-year growth comparisons are somewhat misleading due to last year’s atypical seasonal production patterns. In addition, year-over-year domestic fluid milk sales were down sharply during March and April, while commercial cheese use was up sharply in April. The recovery however is not reaching the cheese segment yet, according to the National Milk Producers Federation (NMPF) as prices continue to struggle.
(SOURCE: All Ag News)