The United States has amassed its largest stockpile of cheese in the 100 years since regulators began keeping tabs, the result of booming domestic production of milk and consumers’ waning interest in the dairy beverage.
The 1.39 billion-pound stockpile, tallied by the Agriculture Department last week, represents a 6 percent increase over this time last year and a 16 percent increase since an earlier surplus prompted a federal cheese buy-up in 2016.
Analysts say commercial warehouse stocks have swelled because processors have too much milk on their hands, and milk is more easily stored as cheese. Demand has also fallen as school cafeterias close for the summer and restaurants wind down the cheesy specials they offer in the winter and early spring.
Some have grown concerned that stockpiles will build further yet if trade tensions with China and Mexico cut into cheese exports. Cheese prices have fallen sharply, they say, eroding dairy farmers’ already thin margins.
“Milk production continues to trend up, and that milk has to find a home,” said Lucas Fuess, director of market intelligence at HighGround Dairy, a consulting firm. “The issue this year is that, with so much supply, it’s going to be tough for a lot of farmers to be profitable.”