US Cheese Surplus: America Has 1.4 Billion Pounds Too Much

America is sitting on a massive surplus of cheese with a record 1.4 billion pounds of cheddar, American and Swiss in cold storage. As crises go, this one may not rank as high as the nightmare for about 800,000 federal workers and 4 million contractors who aren’t getting paid, but the cheese glut is now bigger than it’s ever been in the 100 years the government has been keeping track.

For perspective, 1.4 billion pounds of cheese translates to 700,000 tons. That’s the equivalent to the combined weight of a herd of about 100,000 fully grown African elephants. The 1,000-pound block of cheddar cheese presented to Queen Victoria for her wedding in 1840 sounds positively miniscule when compared to the amount of cheese America has bulked up. And, as National Public Radio member station WBUR in Boston pointed out, the U.S. has 900,000 cubic yards of excess cheese, enough to form a wheel as large as the U.S. Capitol

We’ve blown past the previous record, a 32-year high set in 2016, and the surplus of cheese is 16 percent larger than it was three years ago. In 2016, the government spent $20 million to buy 11 million pounds of excess cheese, which was distributed through the USDA’s various nutrition programs.

How did this stockpile of excess cheese happen?

It’s a combination of factors, the main one being that dairy farmers produced more milk than the market could bear, so they turned it into cheese, which has a longer shelf life. But it won’t last forever, and once it’s been in cold storage for a few weeks, it’s harder to move the cheese, MarketWatch reported.

Cornell University agricultural economics Professor Andrew Novakovic told WBUR’s Jerry Hobson on “Here & Now” that President Trump’s trade war is a “self-inflicted wound” that has exacerbated the glut. Annual cheese shipments are down 63 percent to China and 10 percent to Mexico, as of September, according to the U.S. Dairy Export Council, an industry trade group.

Mexico is “far and away” the biggest export customer for U.S. cheese, Novakovic said, and “if we could get ourselves back in a better trade situation, that would help quite a bit.”

With exports on the decline, cheese makers are looking at domestic markets to fill the void, but there’s a problem there, too. Americans still love cheese — we ate about 37 pounds of it per person in 2017 — but our tastes are becoming more discerning.

Pizza-loving Americans are still eating as much mozzarella cheese as they ever did, but they’re turning their noses up on processed cheese in particular, but also American and cheddar cheeses.

Producers are trying to make more exotic, specialty-type cheeses as Americans’ palates become more sophisticated, but it’s a slow process. If a factory is set up to make commodity-type cheese, it can’t just flip a switch and start making something like Camembert, according to Novakovic.

Cheese prices are going down to increase consumption for the past three or four years to move the cheese at grocery stores and other retail operations. Dairy farmers want that to stop, but the fact is they’re “still pushing out a little more milk than we know what to dith,” Novakovic told WBUR.

“And really, it's not a big number, but until those two numbers get reconciled, we're going to continue to see these low prices,” he said.

(AP Photo/Carrie Antlfinger)