Wisconsin cheese output has been soaring for the last two years consecutively, which could be good news for dairy farmers looking to increase sales.
According to a U.S. Department of Agriculture report released Nov. 3, Wisconsin’s dairy plants produced 3.3 percent more cheese in September 2016 compared to September 2015. Compared to September 2014, dairy plants produced 2.8 percent more cheese in September 2015. Mark Stephenson, University of Wisconsin Dairy Policy Analysis director and the Center for Dairy Profitability, said this trend has been fairly stable and has led to stronger domestic cheese sales.
“[Rising cheese output] can be a very good thing for Wisconsin,” Stephenson said.
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Stephenson said most of Wisconsin’s rising output comes from either unsold cheese or from surplus raw milk. Dairy farmers are turning this raw milk into less perishable forms of dairy like cheese and butter.
Wisconsin currently has the highest cheese production nationwide and produces approximately 258 million pounds of cheese, as of September 2016. Stephenson said this is a “much heavier stock” of cheese than normal and has led to a decrease in cheese prices in the country.
But milk supply has been in surplus around the world, which has kept prices low globally. Stephenson said this could be problematic for Wisconsin because less people will buy cheese from the U.S. Moreover, because of the U.S. dollar’s relatively strong valuation, everything it exports seems more expensive when compared to others, he said.
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Stephenson said there is a plus side to having a rising cheese output in context of the global cheese market. World and American cheese prices have slowly converged recently, which opens more opportunities for the U.S. to sell cheese to others.
Stephenson said this would not directly affect Wisconsin’s dairy farmers but could indirectly have a positive impact on their livelihoods.