Milk quota abolition: Everything you need to know

Holstein dairy cows©Tim Scrivener

Dairy farmers will wake up in a new world on 1 April. After more than 30 years, the EU milk quota regime finishes at the end of March.

See also: 12 dairy predictios for when milk quotas go

On Thursday (26 March), farm commissioner Phil Hogan hailed the chance to tap into growing world dairy demand.

But what is changing? How does it affect farmers? And why did we have quotas in the first place?

What’s happening?

The milk quota regime is ending on 31 March. Each EU country has had limits on the amount of cow’s milk delivered to dairies or sold direct each year. If they overproduced, they were fined heavily. But, from next month, those brakes are off.

Hasn’t it been coming for a while?

Yes, for 12 years. The decision to abolish quotas was taken in the 2003 round of CAP reform. The EU decided to bring in a “soft landing” from 2008, raising the quota slightly each year to allow countries to ramp up production steadily.

Why are the restrictions coming off?

The EU wanted European farmers to be able to sell more products on fast-growing dairy markets around the world. Global demand for dairy is expected to grow 30% by 2024, particularly in the Far East and South Asia.

By removing quotas, EU farmers and dairy companies can grab their share of that new business.

That’s today, but why were they introduced in the first place?

Overproduction. In the late 1970s and early 1980s, subsidised European milk production kept outstripping shopper demand, leading to waste in so-called milk lakes and butter mountains. So, in 1984, the EU brought in the quota regime to cap each country’s output. Read more

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