Dairy farmers are seeing some relief in wholesale milk prices after hitting five-year lows during shutdowns.
The price of wholesale milk has nearly doubled, going from $13 per cwt. to $24 per cwt.
Mark Stephenson, the director of dairy policy analysis at the University of Wisconsin-Madison, said the increase in prices is due to government buying food boxes, restaurants opening back up and low cheese prices driving up the export market.
Now, wholesale cheese prices have tripled what they were.
“We are expecting that those prices are going to moderate fairly rapidly on into the fall but to prices that are more normal for us, not that are necessarily low,” Stephenson said. “These are very high prices right now.”
Before prices go down to $16 to $18 per cwt. Stephenson said farmers should think about refilling cash reserves and paying off some debt, but he said this is good relief for now, especially since 2020 was projected to be a recovery year before the pandemic hit.
Stephenson said the price fluctuations are not expected to be very noticeable to consumers.