Cheese production in 1999 grew 6 percent over a year ago. In the West, cheese production grew 12 percent. Demand, however, has been relatively steady. As a result, cheese stocks in public warehouses were up 10 percent at the end of December, and are growing. Inflated cheese stocks will keep milk prices low, Bailey says, until the milk glut passes through the nation's system.
Dairy farmers have no choice but to wait out the low prices.
Expansion in Western states should slow down this year. In the meantime, Pennsylvania dairy farmers will have to try to ride out the storm. Milk prices will be better in the spring. Right now those opportunities are limited. Farmers also should budget their monthly income and expenses for the year.