There are 1.4 billion pounds of excess cheese in the United States. The sheer volume of cheese is about the same size as the US Capitol Building, all sitting a warehouses across the country. The amount of excess dairy has grown 6 percent since last year, and the production of dairy is still climbing. With all the excess milk that dairy farmers produce, cheese is the most efficient way to keep it all.
So why is there so much excess cheese? Between 2008 and 2017, milk production climbed 13% while milk consumption dropped 14%. This situation isn't new. In 2016, the government was forced to buy up 11 million pounds of excess cheese. So why would an industry continue to increase production while demand for the product drops?
The answer is the government. The dairy industry is heavily subsidized, meaning that the government gives money to an industry to help support it. The subsidizes have only increased in the past year. This means that dairy farmers are motivated to produce as much milk as possible, even if there is no one to eat it. In fact, government support made up 73% of dairy farmers market returns in 2015.
But this surplus of product can also hurt dairy farmers. The price of cheese has been falling, which means the farmers get less money for the milk they produce. So will reducing the subsides have a negative or positive affect on dairy farmers?
Work Cited:
https://www.investors.com/politics/editorials/dairy-subsidies-government-farm-programs-surplus-cheese/
https://www.washingtonpost.com/news/wonk/wp/2018/06/28/americas-cheese-stockpile-just-hit-an-all-time-high/?utm_term=.aa00136ee7d3
https://www.usda.gov/media/press-releases/2016/10/11/usda-announces-plans-purchase-surplus-cheese-releases-new-report
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This was actually a very interesting blogpost. I had no idea this was happening before. I am just kind of confused why the government continues to provide subsidies if it creates a surplus? For a short time, it could be helpful but, in the long term, it makes the dairy farmers dependent on the government and encourages them to create a product that isn't in high demand. I did find it interesting that it is stored as cheese because it's the most efficient way to keep dairy. It reminded me of another story that I read about a bank that kept cheese as collateral (https://www.washingtonpost.com/news/on-small-business/wp/2017/04/17/this-bank-will-take-cheese-as-collateral/?utm_term=.1ac9635b424b). The way that cheese can last long and can be quite expensive makes it work as a currency in some situations. You said that cheese consumption dropped but it wasn't clear if that was in the United States or globally. If it's domestically, it could make financial sense to export it. Regardless of the best solution for this situation, this was a very informative and surprising blogpost.
ReplyDeleteI think that this was an interesting and surprising article. I was unaware about the amount of cheese being produced in the US and a still confused by it. We have talked many times in class about an example where there is a crop farmer. If more and more crop is produced, the price at which it can be charged decreases. I would think that this would be the same with cheese, and less would be more. All the excess cheese produced hurts farmers a lot too, because they cannot make the money that they want. In conclusion, the farmers are hurt and there are heaps of unused cheese, so why is the government subsidizing? https://www.taxpayer.net/agriculture/government-cheese-dairy-subsidies-are-hard-to-swallow/
ReplyDeleteI found this really interesting post, I saw the title and was curious about where your topic was going. I really like how you related what we learning to something as simple as cheese production. It helped me understand how when there is an excess or surplus of a material such as milk and how that affects everything else around the product. I do have a question about the product. If there was a surplus of milk why was the only solution cheese, there are so many other uses for milk such as yogurt, milk itself, baking etc.
ReplyDeleteThank you for this informative post Katie especially on a new and refreshing topic, did not know anything about cheesenomics until now! After you mentioned that “Between 2008 and 2017, milk production climbed 13% while milk consumption dropped 14%”, it reminded me of the advertising campaign “Got milk?” and I was curious how or why it became so popularized. I investigated and learned that “federal dietary guidelines recommend three servings of dairy a day” because during WWI, the government was sending excessive amounts of milk for soldiers “to fight malnutrition”. This incentivized the farmers to increase their milk production in comparison to other agricultural crops and the country was left with a surplus of milk which they didn’t know what to do with. As a result, they made citizens drink more milk and advocated its benefits as “essential”, especially kids that are growing which is why it’s often served with hot lunch in the cafeteria. Interesting how government plays a role in why there’s excess cheese in Domino’s pizza and “a dairy heavy menu” in Taco Bell and Starbucks today…
ReplyDeletehttps://www.vox.com/2016/5/2/11565698/big-government-helps-big-dairy-sell-milk