WASTEBOOK: Government Cheese

$21.8 million

Nationwide

U.S. Department of Agriculture

There is more surplus cheese stored in refrigerated warehouses in the U.S. than at any time since the records were first taken 100 years ago, according to the U.S. Department of Agriculture (USDA).  Cheese sales in some parts of the country are “lagging behind production rates, causing stocks to accumulate,” the USDA notes.  As a result, some cheese makers are even “cutting back” on manufacturing to “manage large inventories.”

Despite this growing mountain of cheese, the federal government is subsidizing more companies to get into cheese making and buying the leftover cheese.

At one point, the surplus of cheese and other dairy products held by the government had a market value of $3 billion and was so large it took 500 warehouses and five giant storage caves carved out of limestone to store it all.

This year, approximately 11 million pounds of the surplus cheese valued at $20 million was acquired.  USDA says the move is in response to “requests from Congress” and advocacy groups for the industry.  The Department says the purchase is “assisting the stalled marketplace for dairy producers whose revenues have dropped 35 percent over the past two years.”

Despite these unfavorable conditions, USDA spent $1.8 billion to subsidize 16 new cheese making ventures this year through the Value Added Producer Grant program.

Burnett Dairy Cooperative of Grantsburg, Wisconsin, received the largest slice.  The co-op is spending the $250,000 grant “to help expand the sales of meat infused string cheese.”  Zesty Teriyaki, Hot Pepper Beef and Pepperoni Pizza are among the mozzarella string cheese snacks blended with meats currently offered by Burnett Dairy. The new product, which is string cheese with a beef stick in the center, is being developed with meat snack maker Jack Link’s.  “They came together and decided this was something there was a market for,” says Jeff Hudson, the Business Programs Director for the USDA Rural Development Agency in Stevens Point.  Hudson cautions “the purpose of the grant is not to give out ‘free money.”  That statement has more holes in it than a slice of Swiss cheese.

USDA also paid out more than $11 million in financial assistance to dairy producers enrolled in the Margin Protection Program (MPP) for Dairy.  This was the largest pay out since the program established in 2014 to provides financial assistance “when the margin – the difference between the price of milk and feed costs falls below the coverage level” for dairy producers.

Even some dairy farmers are criticizing the federal government’s cheesy policies. “Farmers are not encouraged to produce less and they feel the only way they can help make ends meet and get all of their bills taken care of at the end of the month is to produce more milk, which in turn ends up hurting them in the end,” laments Darin Von Ruden, a dairy farmer and president of the Wisconsin Farmers Union.

Government cheese really grates on taxpayers.

The Official Wastebook