Explaining the U.S. food surplus

Warehouses, distribution centers and grocery stores are overflowing with some food staples, such as milk, eggs and frozen fruits and vegetables, the result of increased production and decreased exports. Take dairy, for example: With the most milk ever produced in the U.S. — about 24 billion gallons — that means there are record amounts of butter and cheese. The glut of food means lower prices for consumers. Here's a short explanation of how the surplus came about and where it all goes: Two years ago, high prices for milk, pork, poultry and eggs encouraged farmers to expand livestock operations. Plus, U.S. consumers were opening their wallets and trade partners were willing to keep buying our products. Add to that the cheap cost of animal feed that encouraged farmers to boost livestock's weight before taking them to market. But agriculture is a cyclical business: The relative high value of the dollar makes U.S. products more expensive to importers, so they've slowed their buying. Last year's bird flu crisis also caused many trade partners to stop taking eggs and turkey and chicken meat, and while production of eggs has returned, demand isn't fully restored. Those factors and others have suppressed demand, but the cows keep pumping out milk and veggies continue to grow, resulting in a surplus of certain types of food.