The end of July marked the halfway point in the allotted time period for the dispersal of $3 billion through the Farms to Families Food Box program that was instituted by the Coronavirus Food Assistance Program in mid-April.
With the first purchases of this program in mid-May, cheese prices began a rally that resulted in a nearly $1.50 per pound rally through the month of June. While this was the result of a combination of factors, certainly the USDA purchase has made some difference.
It warrants the question, “What can we expect from the rest of the allocated funds?”
So far, 50.3 million food boxes have been invoiced. During Round 1 of the program that ran from May 15 to June 30, $947 million was allocated to food purchases. Round 2 is predicted to utilize another $1.47 billion ending August 31, 2020.
If those numbers prove accurate, the third round that extends from September 1 to October 31 will be worth a smaller $583 million. We don’t know what that will mean for dairy nor how it will overlap with typically large fall domestic usage of dairy products like cheese and butter.
Development of COVID-19 and national, regional, and local response programs will continue to determine how domestic and export demand respond through the rest of the year and beyond.
If you’d like to learn more about the food program and how its resources will be allotted, visit the USDA website.