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Economist not surprised by increased dairy cold storage numbers
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A dairy economist says he was not surprised to see a lot more cheese and butter go into cold storage. The USDA released the April cold storage reports Thursday, and Mark Stephenson from the University of Wisconsin’s Dairy Profitability Center tells Brownfield the cheese and butter that is not going to foodservice and restaurants must go somewhere. He says, “It wasn’t a big surprise but I guess it’s kind of a confirmation of what we’ve been seeing, and that is that we had to have a place to put the product.”
Stephenson tells Brownfield he expected the impacts of COVID-19 to affect cold storage inventories sooner. “I thought they would have been up last month, but this month they’ve really shot up so that’s telling us (there’s) a lot of product going in.”
Stephenson says the pandemic will continue to impact the markets after the all-clear is given, and restaurants and foodservice operations try to get back to normal. “We’re still not done with this yet, and even when we are, and have declared this to be done, we’re going to have a big and deep recession to deal with, and that means that some of these sales and consumption and out-of-home eating is going to be difficult to get back to where it was.”
Butter stocks jumped 59 million pounds from March to April totaling more than 368 million pounds, 78 million pounds more than April of last year. American style cheeses jumped 60 million pounds from March to April totaling more than 836 million pounds, also up from a year ago.
