refrigerated warehousing, if a company can find space, but milk is perishable and so excess supply has to sell or go bad in a short time of about a couple of weeks or just a bit more. The effect will be seen at the store as suppliers offer lower prices just to recoup some of the cost of production as opposed to taking a total loss. The pressure also comes because the entire dairy farm supply chain is beholden to Mother Nature since cows produce milk whether or not someone wants to buy it and so they have to be milked and that milk can either be shipped or dumped. There's no other choices if you are going to keep the herd size.
The option of sending cows to slaughter is there but that has it's own problems as well because a big move to do so across farm country will depress the market price for the cow and so shipping the cow for slaughter might get you out from under feeding and caring for her but bring a small actual cash influx. Then too there is the problem of replacing her when the milk market picks up. The part of the industry that raises calves to heifers is not going to keep up production levels if nobody is buying cows to milk and so the time from calf to producing cow has to be taken into account. Also Mom isn't going to be inseminated to produce the calf if calves aren't needed and so when the market comes back there is her gestation time as well.
It affects the feed and grain markets as well since fewer cows means less demand for hay and feed.
All in all that is why major artificial disruptions to markets create problems for supply chains that are closely interdependent on various parts to keep a reasonable balance so that long term forecasting for demand can be planned for and accommodated.
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