A spike in prices for U.S. dairy products has hit futures markets, which means more expensive cheese and butter for Americans may be coming.
Omicron is one culprit. Manufacturers are struggling, with the Covid-19 virus variant causing more absenteeism at dairy plants. There’s also a more long-term trend at work: milk production in the U.S. is dropping. It’s getting too expensive to feed cows with grain costs soaring, so farmers are shrinking their herds and sending animals to slaughter. For the cows that remain, they’re getting fed less, which means they’ll produce less milk. Rising labor and energy costs are also making it tougher for dairies to net profits.