Reopened restaurants drive dairy higher

As restaurants reopen in the U.S., Americans again are eating food laden with more butter and cheese than most home cooks would dare to use. The extra consumption is sending prices higher.

Cheese sold on the Chicago Mercantile Exchange in 500pound barrels is up 18 percent so far this year. That's the processed kind you'd top a burger with and find at most restaurants. Cheese sold in 40-pound blocks, the sort used in party platters and consumed in homes, has risen 9 percent.

Restaurants are a major factor for how much dairy Americans eat, because they use so much of it on their menus. Last year during lockdowns, consumers bought more cheese at grocery stores, but it wasn't enough to make up for the loss from restaurants. As a result, milk was dumped, cheese in storage in the U.S. reached an all-time high and uncertainty about demand led to wild swings in prices.

Now, both restaurants and grocery stores are buying cheese. Americans ate 2 percent more cheese in January and February over the prior year in the latest data available, Dairy Farmers America said.

Demand abroad is also strong. Internationally, China is undergoing a “cheese demand revolution,” according to analysts. The Asian nation's imports surged to a record high in March.