# Government dairy purchases at a 30-year high

> StoneX analyst Nate Donnay estimates that US government dairy purchases in 2020 pushed the CME block cheese price up about 64 cents per pound and butter up 31 cents from May through November. He estimates the purchases lifted the average Class III milk price by about $6.30/cwt and Class IV by about $1.31/cwt. Purchases through the food box program and other programs totaled roughly $1.33 billion.

- Date: 2020-11-30 · published 2020-11-30T12:00:00.000Z
- Category: policy · region US · magnitude medium
- Page: https://feedsoft.ai/events/50301-government-dairy-purchases-at-a-30-year-high
- Commodities: [Milk (Class III)](https://feedsoft.ai/c/MILK.md)

## Why it matters

Government buying has been a major source of dairy price support and volatility, so feed buyers should expect dairy-linked demand and milk prices to be sensitive to any reduction in these programs.

## Read by commodity

- MILK: bullish ▲

## Linked price moves

| Commodity | Date | Window | Change % | z-score | Why linked |
| --- | --- | --- | --- | --- | --- |
| MILK | 2020-12-02 | 5 | -34.4% | -4.8 | Shows government food box purchases had inflated cheese and Class III prices, so their fading removed support and fed the reversal. |

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| MILK | 2021-01-14 | [Despite enormous production, government purchases boost milk prices](https://feedsoft.ai/events/49311-despite-enormous-production-government-purchases-boost-milk-prices.md) | -1.0% | -4.0% |
| MILK | 2019-10-28 | [USDA purchases $50 million in fluid milk](https://feedsoft.ai/events/4106-usda-purchases-50-million-in-fluid-milk.md) | +8.1% | +9.1% |
| MILK | 2025-04-03 | [Economic Update: Several dairy bills receive support in Congress \| Ag Proud](https://feedsoft.ai/events/5651-economic-update-several-dairy-bills-receive-support-in-congress-ag-proud.md) | +0.7% | +7.4% |
| MILK | 2016-11-03 | [Main dairy trade index jumps by 11.4%](https://feedsoft.ai/events/4653-main-dairy-trade-index-jumps-by-11-4.md) | +13.3% | +15.8% |
| MILK | 2022-01-07 | [The Farmer's Exchange Online Dairy Economist: 2022 Should Be Profitable for Milk Producers](https://feedsoft.ai/events/4074-the-farmer-s-exchange-online-dairy-economist-2022-should-be-profitable-for-milk.md) | -0.4% | +1.4% |

## Sources

- hoards.com: https://hoards.com/article-29165-government-dairy-purchases-at-a-30-year-high.html

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.