LYNDEN, Wis. -- According to Dairyline.com, while the USDA Cold Storage report for March shows total cheese stocks at 727.6 million pounds, there's a good possibility it's not all accounted for.
While both the March and year-to-date cheese inventory numbers are up 2 percent, what those estimates don't reveal, said market analyst Jerry Dryer, is that most every cheese manufacturer, trader and end-user stashed some cheese during the first quarter.
"Prices have been low enough, so they're confident they can make money later in the year by holding on to that product," said Dryer, editor of Dairy & Food Market Analyst.
Dryer cited "inherit limitations" in the way USDA conducts its survey as a reason why the stashed product is not reflected in the Cold Storage report. That leads him to believe cheese inventory estimates are a bit low.
With warm weather edging 2002 milk production even higher, Dryer also hinted that typically increased milk volumes in April will put further downward pressure on dairy prices.
"Milk keeps pouring forth," he said, adding that if cow numbers remain constant and output per cow increases as much in April as it did in March, a milk supply increase of 4 percent is not out of the question.