Minnesota Dairy Farmers Experience Unexpected Turnaround As Demand Increases
MINNEAPOLIS (WCCO) -- In March, COVID-19's impact on commodities was hard to ignore. Prices across the board took a hit, but some have since rebounded.
That includes milk prices where Minnesota dairy farmers are experiencing a somewhat unexpected turnaround, as demand at grocery stores has been steady.
"For it to all of the sudden come back like this is surprising," said Andrew Patnode. "Spirits are getting a lot better for everybody I think."
Patnode is a 6th generation dairy farmer in western Hennepin County. His family has seen a lot over the years, including watching milk prices sour in April. But two months later the market has returned and with it, cautious optimism.
"June milk is looking really good because demand is coming back right now and it's coming back really fast," said Patnode.
The turnaround can be attributed to a number of factors, from restaurants re-opening to school food programs.
"A few things happened, it all added together to make a perfect storm in a positive way," said Lucas Sjostrom.
Sjostrom is the executive director of the Minnesota Milk Producers Association. He said schools typically don't buy milk in the summer but with COVID, many districts are supplying food and milk to students all summer long. A restaurant resurgence has also helped.
"When you see restaurants re-opening, not just in Minnesota and Wisconsin but across southern states as they have been, that really does affect us here. Even if we aren't selling directly to those restaurants in the southern part of the U.S., it's helping our price," said Sjostrom.
Cutting back on production when the virus first hit lessened the supply but raised prices. And Sjostrom said the USDA and others have stepped up to help with the turnaround.
"I would say, on average, June was a great month and the rest of the year looks like something where farmers can break even or something a little better," said Sjostrom.
