Dear dairy farmers and interested parties,
It seems like milk prices in the EU have entered a never-ending downward spiral. It has resulted in prices below 25 cents/litre being reported from many countries. Asking whether it is possible for dairy farmers to even survive in this context is therefore very pertinent. If you keep in mind that producing a litre of milk costs much more than 40 cents, then it is clear that NO is the only possible answer to this question.
Protests
This disastrous state of prices has pushed producers all over Europe to take to the streets in massive protests. Policy makers have reacted by convening an extraordinary meeting of the Agriculture Council on September 7 in Brussels. On this day, the EMB and its producers will also be at the scene with a large-scale action! Fact: The end of milk quotas led to surplus production, which has destroyed prices. The promise of an amazing new export strategy that would allow surplus milk to be effortlessly soaked up by global markets has not become a reality and the slack EU safety net would probably collapse under the weight of a single feather. It is a fact as well, that the sharp drop in milk prices in Switzerland, where milk quotas were phased out back in 2009, was a clear example of where the EU would be headed as well.
Policy
You could criticise policy makers, industry and the many producer representatives, who should have predicted this development long before April 1, 2015 – the day the quotas ended. This is a valid argument and not without merit. Alternatively, we could stop complaining and reach out to all stakeholders of the dairy sector instead, urging them to learn from their mistakes and to come up with a prompt, long-term common solution. A solution that will lead the sector out of this crisis. The EMB wishes to focus on this second option and look constructively towards the future. We believe that it has slowly become clear to one and all that we need an effective crisis management programme in Europe. The Market Responsibility Programme (MRP) proposal is on the table. We – producers, policy makers and industry – need to discuss it together, frankly and honestly. There is no need to be afraid, it does not bite!
In our August newsletter, you will find more information about the action on September 7 in Brussels and on the protests of dairy farmers across Europe. It also talks about the risks posed by the trade agreements between the EU and Canada (CETA) as also the EU and the USA (TTIP). I wish you an interesting read!
Silvia Däberitz, EMB Manager
