EU dairy productions fall in 2008

After the peak in mid-2007, domestic prices for raw milk and export prices for dairy products are plummeting in 2008.

 

Lower prices of milk and increased costs of agricultural inputs make milk production and dairy processing less profitable.

 

Despite low prices, milk production in the EU-27 is expected to increase in 2008 due to a growing milk quota and higher demand for dairy products. However, the increase in production is not expected to continue at the same rate in 2009 due to the fall in raw milk and dairy product prices in the world market.

 

In the spring and fall of 2008, farmers in Germany, Austria, France, Czech Republic, Poland and Bulgaria protested against the fall in milk prices and higher cost of inputs.

 

European dairy herds continue to decline, however there is continued genetic improvement and higher yields from cows and a general trend toward greater coalition of the dairy industry.

 

Until the end of October 2008, the Commission did not interpose on the internal or external dairy market.

 

However, the situation may change towards the beginning of 2009 as growing supplies and lower competitiveness of European dairy products on the world market and stable domestic consumption will put strong pressure on the EU authorities to build intervention stocks, subsidise consumption or re-introduce export refunds.

 

Country:	EU-27
Commodity:	Dairy, Milk (1000 Head / 1000 MT)
　	2007			2008			2009
　	USDA Official	Post Old (EU-27)	Post New (EU-27)	USDA Official	Post Old (EU-27)	Post New (EU-27)	USDA Official	Post Old	Post New (EU-27)
Calendar Year Begin	01/2007			01/2008			01/2009
Cows In Milk	24344	24344	24178	24000	24000	23951	　	　	23950
Cows Milk Deliveries to Dairies	132600	132600	132604	133670	133670	134000	　	　	134400
Other Milk Production	4125	4125	4270	4150	4150	4259	　	　	4260
Total Milk Production	136725	136725	136874	137820	137820	138259	　	　	138660
Extra EU25 Imports	7	7	12	10	10	6	　	　	5
TOTAL SUPPLY	136732	136732	136886	137830	137830	138265	　	　	138665
Extra EU25 Exports	155	155	156	160	160	170	　	　	150
Fluid Use Dom. Consumption.	34000	34000	33334	34000	34000	33569	　	　	33645
Factory Use Consumption.	102577	102577	103396	103670	103670	104526	　	　	104870
Feed Use Dom. Consumption.	0	0	0	0	0	0	　	　	0
Total Dom. Consumption	136577	136577	136730	137670	137670	138095	　	　	138515
TOTAL DISTRIBUTION	136732	136732	136886	137830	137830	138265	　	　	138665
Source: FAS EU offices