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Analyst says dairy prices go up and down with government food purchases

A market analyst says the COVID-19 relief programs like the Farm to Families Food Box program had a direct impact on dairy markets. “As we talk about the sunset of each and every round of those programs, you could watch the market fall off, and then at the announcement of the next food box program, prices would skyrocket.”

Mike North with ever.ag tells Brownfield the new 1.9 trillion-dollar relief signed by President Biden has 4.6 million dollars for food purchases, and the last COVID aid package still has some of the 1.5 billion in food assistance dollars available. “If they ramp up their spending to hit that full one-point-five (billion), we could see some excitement here over the next couple of months in milk price. If we don’t, then just the opposite could be true. And then, as we stack this new one-point-nine trillion package on top, depending on what dairy’s share of that money is, we could ultimately see again another run in price.”

North says he believes the dairy prices in 2021 will be “incredibly binary” and fluctuate based on what the government does.

Photo L-R: Pete Turk, Mike North from ever.ag and Brownfield’s Larry Lee at World Dairy Expo