The prolonged crisis: why the European dairy situation takes the global stage

by Martin Choi and Marina Starodubtseva

Dairy farm in Braine-le-comte, Belgium
Dairy farm in Braine-le-comte, Belgium

According to the European Commission last week, 52 thousand farmers around Europe applied for the new EU Milk Reduction Scheme released earlier in July, paying farmers not to overproduce milk. Nevertheless, many European farmers still consider the future of global dairy farming is at risk.

It’s not normal when the price of milk is cheaper than water in the local supermarket.

This fact has not gone unnoticed by President of the European Commission Jean-Claude Juncker, who has acknowledged this two consecutive years in a row in his annual State of the Union speech to the Parliament on both 14th Sep. 2016 and 9th Sep. 2015.

The situation of the dairy crisis faced by consumers and producers of milk in Europe has gone on for two years. But it’s a milk problem with global repercussions.

According to Commission sources, there isn’t only a European oversupply as other countries such as New Zealand are large producers as well. The global milk production, with Europe being the largest producer with approximately 156 billion liters annually, greatly exceeds the global demand.

“We have looked at the different systems worldwide, and we see that as soon as the chain is overproducing, farmers worldwide are in crisis,” said Sieta van Keimpema, the Vice President of the European Milk Board and Chairman of the Dutch Dairymen Board.

“So not only the European farmers but farmers in Africa today are in crisis because we are dumping our overproduction in those regions, and that’s giving a lot of trouble.”

With the continuing overproduction of European milk, the crisis shows no signs of ending in the imminent future.

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