A surplus of milk has led to plummeting prices and forced some farmers in the Upper Midwest to dump their excess.
A Milwaukee Metropolitan Sewerage District spokesperson confirmed that large amounts of milk have been dumped into the sewer, but the official amount has yet to be established, per Bloomberg.
“We’re talking 45 to 50 trailer loads a day, 6,000 to 7,000 gallons each, and there is no home for that milk,” said Peter Hardin, editor and publisher of the dairy industry blog The Milkweed, according to Fox 6 Milwaukee.
“This is a crisis. I mean, dairy is Wisconsin’s single largest agricultural endeavor,” said Hardin.
The surplus comes as a result of the Upper Midwest seeing demand for milk drop by 20% in 2023, per KTLA 5.
Bob Cropp, professor emeritus and dairy marketing specialist at the University of Wisconsin-Madison, said processing plants in Wisconsin and Minnesota have been “unable to get other plants to take the milk because they have all the milk they need,” reported Bloomberg.
Nate Donnay, director of dairy market insight at StoneX, told Bloomberg, “Farmers have continued to grow milk production, which has put us back into a surplus situation in the region.”
The industry has not seen dumping like this since 2020, when many schools and restaurants were shut down due to the COVID-19 pandemic.
“The last time this happened was a little bit at the beginning of the pandemic, and before that, it was almost unheard of,” said John Umhoefer, executive director of the Wisconsin Cheese Makers Association, Fox 6 reported.
Data from the U.S. Department of Agriculture shows that milk prices have decreased significantly over the last year.
“[F]arms are making decisions as milk prices fall to their lowest levels since the worst period of the pandemic,” said Laurie Fischer, CEO of the American Dairy Coalition, per Bloomberg.
In May 2022, Class III milk, which is used to make cheese, was selling for $25.21 per hundredweight, but the May 2023 price was just $16.11 per hundredweight.
Class IV milk, used to produce butter and dry products, sold for $24.99 in May 2022 and just $18.10 in May 2023.
Some solutions, such as sending more dairy cows to slaughter, may need to be enacted to help the crisis.
“I expect the herd size and milk production to decline in the coming months as farmers make adjustments due to the low prices,” said Lucas Fuess, a senior dairy analyst with RaboBank, Bloomberg reported.
Stakeholders hope such solutions will help the industry’s short- and long-term outlook.
“We do believe this will come to an end swiftly, but right now we are in an imbalance,” said Umhoefer, per Fox 6. “It’s a shame.”
