With all 10,000 of our lakes here in Minnesota currently frozen solid, this may be a strange analogy, but dairy prices move like the waves rippling out from a rock thrown in the water. The bigger the rock, the bigger the initial waves are, but they eventually get smaller and smaller until everything is back into balance. It takes only seconds for the waves to flatten out on the lake, but it can take one to two years for the dairy markets to find equilibrium after a large shock.
I bet you think I’m going to talk about the pandemic, but I’m not. Another shock to the dairy market will be playing out into early 2022 and deserves some attention.