As a truck driver steps out of his rig, there is a look of confusion, defeat and disappointment on his face. He walks to the back of his tanker truck, opens the valve and stands back as gallons of milk pour out onto the ground.
The image is harrowing to say the least. As if America’s milk industry wasn’t struggling already, producers in high production states are now being forced to dump entire trucks, or worse yet, dispense of their entire storage tanks on farm.
What makes this situation so precarious is the fact grocery stores are struggling to keep enough milk on the shelves. Many stores have had to limit consumer purchasing of milk just to keep up with demand. Understandably, consumers are flummoxed. If there is a high demand for milk in the stores, then why are producers being forced to dump their product on the ground?
The answer, it turns out, has to do with supply and demand, but with a slight twist.
“Before COVID-19 hit, a huge amount of dairy consumption was in schools and restaurants. The processing of milk and milk products for restaurants and school is totally different,” said Lily Andersen, who runs a family operation, Skattum Dairy, located south of Livingston, Mont., with her husband Kyle.
Andersen went on to explain that milk manufacturing is highly specialized. The machines needed for specific processing and packaging of milk and milk products are very expensive, and because of that, processing facilities typically only process and package one form of diary product. For example, a processing facility may specialize in carton milk for schools or individual butter packets for restaurants, and the facilities can’t simply switch to bottling milk because their machines just aren’t capable.
Additionally, like many ag commodities, dairy is contracted. This means a processing facility specifically buys a farmer’s milk for one specified purpose.
To further complicate the matter, milk is a perishable item, which makes any kind of storage essentially impossible. The facilities may be able to vamp up production in the near future, but one of milk’s main selling points is the fact it is so fresh.
“Milk you buy in the grocery store was on the farm 48 hours before,” Andersen pointed out.
Andersen and her family feel lucky to be producing milk in Montana. Since Montana is not a big dairy producing state, farmers are less likely to be impacted by this manufacturing conundrum, but they are certainly not exempt from the problems.
Montana only has three milk processing facilities, with two of them being owned by Meadow Gold. One of Meadow Gold’s processing facilities is in Great Falls and the other is in Billings. The state’s third milk processing facility is Darigold, with a plant located in Bozeman.
“Our milk truck driver just told me they may have to start dumping milk in Great Falls. That is related to the fact the Great Falls plant is one of the places that does school milk cartons and they aren’t having to make cartoned milk right now. They are hoping the Billings plant can take the excess,” Andersen stated.
Skattum Dairy produces Grade A milk, also known as fluid grade milk, and they are contracted with Meadow Gold in Billings. That particular plant specializes in bottling milk, so Andersen and her family feel their milk is relatively safe for now.
Andersen went on to emphasize the dairy industry is doing everything they can to keep up with the demand in grocery stores and they are trying desperately to stabilize production. Keep in mind however, the correction won’t happen overnight.
“I know it is frustrating people to no end that they are being limited in the grocery stores and then they see the news and wonder, ‘Why am I being limited if they are dumping milk?’The industry is just trying to get the manufacturers and the processing facilities caught up to the demand and then hopefully they won’t have to dump milk,” she added.
The dairy industry has seen some hard times these past few years and in a lot of ways the COVID-19 pandemic is just adding salt to the wound.
“Dairy farmers are eternal optimists, but we have to be in this market,” Andersen laughed.
Andersen encourages people to reach out to dairy producers and ask them questions if need be. Milk is a wholesome, local food, she says, with several nutritional benefits. In conclusion, Andersen and her family simply ask people to drink more milk.