Dutch dairy farmers still in EU top five

Even after the abolition of milk quotas in 2015, the Netherlands is one of the five most competitive dairy countries in the European Union. Together with Belgium, Luxembourg, Denmark and Ireland, they form the leading group where the number of specialized dairy farms has remained “relatively unchanged” over the past ten years.

A new scientific Irish-Dutch study highlights that it is mainly cooperatives that have a “high market share” of more than 50% in the Scandinavian countries, as well as in Ireland, the Netherlands, France and Austria. These large dairy farmers can cope with the price fluctuations on the European and international dairy markets.

It is expected that small companies in particular will have a difficult time in the coming years. The study was prepared by scientists from the Irish agricultural institute Teagasc and dr.ir. Roel Jongeneel from Wageningen WUR.

The study report was prepared for the European Parliament's Agriculture Committee and not only considers the development of dairy farming in recent years to date, but also makes recommendations for the coming years. For example, it is noted that the number of dairy farms in the EU countries has increased due to the arrival of new EU member states, and that total production has increased due to the abolition of the milk quota.

However, the dairy sector across Europe has also undergone a number of “structural” changes over the past twenty years, including: a large reduction in the number of dairy farms; a general increase in the average size of the dairy farm; and a long-term decline in the number of dairy cows. In a number of EU countries, the development of the dairy sector is lagging behind considerably, according to the new figures.

The researchers emphasize that environmental policies – both at EU level and in EU countries – are “exerting an increasing influence” on the dairy sector. “Reducing greenhouse gas emissions and improving water quality is having an increasing impact on the EU dairy sector and in some Member States is as, if not more, important than the CAP.” Such obligations threaten to confuse, alienate and discourage farmers,” the authors say.

Looking to the future, it is pointed out that dairy farming will continue to need financial support from the common EU agricultural policy CAP, and that the EU must come up with 'instruments and incentives' (read: financial compensation) to reduce the manure surplus and to reduce greenhouse gas emissions. It is even suggested to introduce some kind of CO2 tax and a settlement system for nitrogen rights, comparable to the current trading in emissions rights of large industrial companies.

The first exploratory discussions are already being held in official and political circles in the EU and plans are being prepared for a new common agricultural policy for the period 2025-2030. After the European elections in June, other coalition agreements must be made in the new European Parliament, which must be implemented by a new European Commission from 2025.