Farmers dump thousands of gallons of milk as companies like Walmart and Costco face shortages and limit purchases. Here is the reason for this infuriating disconnect.

• Dairy farmers are dumping thousands of gallons of milk as they face supply chain disruption and lose their typical buyers amid the coronavirus pandemic.
• At the same time, stores like Walmart and Costco are limiting how much milk customers can buy due to shortages.
• Crucial items from vegetables to toilet paper are selling out in stores while producers are stuck with excess goods, some of which are being destroyed, due to supply chain issues.
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Dairy farmers are dumping thousands of gallons of milk amid the coronavirus outbreak, despite stores dealing with shortages and limiting how much shoppers can buy.

Some cooperatives have been asking farmers to dump milk, Reuters reports. One dairy farmer named Jason Leedle told Reuters he was disposing of 4,700 gallons of milk from his 480 cows every day.

The news disturbed and infuriated many on social media.

Supply chain disruptions are to blame for the thousands of gallons of milk going to waste.

"Mass closures of restaurants and schools have forced a sudden shift from those wholesale food-service markets to retail grocery stores, creating logistical and packaging nightmares for plants processing milk, butter and cheese," Reuters' P.J. Huffstutter reported.

"Trucking companies that haul dairy products are scrambling to get enough drivers as some who fear the virus have stopped working," Huffstutter continued. "And sales to major dairy export markets have dried up as the food-service sector largely shuts down globally."

Milk isn't the only crucial product going to waste

While dairy farmers are being hit particularly hard because milk is highly perishable, the entire industry is being plagued by similar problems.

Politico reports that the loss of big commercial buyers, such as restaurant groups, cruise lines, and theme parks, is forcing some farmers to dump ripe vegetables. Items such as zucchini and yellow squash are being left to rot, because the cost of picking and packing the vegetables would be more expensive than how much the items would actually make if sold.

Producers are also struggling to reallocate products outside of the food and beverage industry.

Will Oremus reports in Medium's business publication, Marker, that people will be using roughly 40% more toilet paper if they shelter in place during the coronavirus outbreak. People won't be using bathrooms at work, in restaurants, or in other public spaces, causing a massive increase of toilet paper use at home, according to manufacturer Georgia-Pacific.

Because toilet paper makers typically produce different products for commercial uses versus people shopping at places like Walmart and Costco, the US is facing an abundance of one type of toilet paper at the same time there are shortages of other types.

"People desperate for toilet paper probably wouldn't turn up their noses at it," Oremus reports. "But the industry can't just flip a switch. Shifting to retail channels would require new relationships and contracts between suppliers, distributors, and stores; different formats for packaging and shipping; new trucking routes - all for a bulky product with lean profit margins."

And get the latest coronavirus analysis and research from Business Insider Intelligence on how COVID-19 is impacting businesses.