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Decline in Dutch Milk Supply Amid Rising EU Production and Stable European Milk Prices

Find out why Dutch milk supply is dropping while EU production is growing. What does this mean for European milk prices? Check out the latest trends and market changes.

As the Dutch dairy industry struggles with falling milk production, Europe faces a curious paradox: a ‘milk lake.’ This situation, where there is an excess milk supply, highlights the complex dynamics within the European dairy market and broader agricultural trends reshaping the industry. This article examines the contrasting developments in Dutch milk supply and rising milk production across the EU, as well as the ‘milk lake’ implications on market stability and pricing mechanisms.

While the Netherlands has seen a continuous decline in milk output due to factors like the bluetongue virus and regulatory changes, countries like Poland and Germany are witnessing growth. According to ZuivelNL, the EU milk supply has grown by 1.1 percent in the first four months of this year, whereas the Netherlands’ supply has dropped by 1.3 percent. These opposing trends raise questions about supply management, market stability, and pricing mechanisms within Europe’s dairy industry.

Unraveling the Drop: Biological Strains and Regulatory Chains Impact Dutch Milk Supply

MonthMilk Supply (million kg)Change from Previous Year (%)
January 20241,100-1.2%
February 20241,050-1.0%
March 20241,200-0.9%
April 20241,180-1.5%
May 20241,150-1.6%

The decline in the supply of Dutch milk stems from biological challenges and regulatory constraints. Last year, the bluetongue virus outbreak in autumn significantly impacted livestock health, reducing milk yield. This effect is evident in the 1.6% drop in May 2023 and a 1.3% average decrease over the first five months of 2024. 

Compounding these biological issues are regulatory changes, specifically the phase-out of derogation, which historically allowed farmers to use higher manure levels to boost production. With stricter nitrogen emission and manure management rules now in place, the number of dairy cows per farm is capped, further limiting milk output. 

In summary, combining the bluetongue virus and regulatory shifts, such as the end of derogation, has led to a notable reduction in Dutch milk production.

Diverse Trends in EU Milk Supply: Poland’s Surge Amid Ireland’s Struggles

CountryMilk Supply Change (April 2024)
Poland+5%
Germany+0.6%
France0%
Ireland-8%

The European Union’s milk supply has seen a notable rise, with a 0.6% increase in April and a 1.1% growth over the year’s first four months. Poland’s impressive 5% increase and Germany’s slight uptick have significantly boosted the EU’s overall supply. However, Ireland struggles with an 8% decline, and France’s growth has stagnated. These contrasts highlight the complexities within the European dairy market.

Stability Amid Complexity: European Milk Prices Buoyed by Sustainability Initiatives and Bonuses

CompanyPrice in May (€ per 100 kg)Change (€ per 100 kg)Sustainability Premium (€ per 100 kg)
Milcobel44.100.000.78
Laiterie des Ardennes (LDA)44.10+0.500.49
DMK Deutsches Milchkontor eG44.10+0.510.50
Hochwald eG44.100.000.80
Arla44.10+0.452.44
Capsa Food44.10+0.06
Valio44.100.00
Savencia44.10-0.09
Danone44.10-0.03
Lactalis44.10-0.18
Sodiaal44.100.000.29
Saputo Dairy UK44.10+0.05
Dairygold44.10+1.08
Tirlan44.10+0.150.50
Kerry Agribusiness44.10-0.190.10
FrieslandCampina44.10+0.471.21
Emmi44.10-0.62
Fonterra44.10+0.32
United States class III44.10-0.29

Since January, European milk prices have remained stable, around 44 euros per 100 kg. In May, the average was 44.10 euros per 100 kg, a slight increase of 0.07 euros from April. This steadiness is due to sustainability premiums and bonuses, including rewards for participating in sustainability programs, GMO-free milk, and other environmentally friendly practices. Such incentives buffer producers from market fluctuations and contribute to the stability of milk prices.

Global Dairy Dynamics: Diverging Trends Highlight the EU’s Stable Milk Supply Amid Global Volatility

CountryApril 2024 Milk Supply Change (%)January-April 2024 Milk Supply Change (%)
Poland+5.0+3.8
Germany+0.8+1.1
France0.0+0.5
Ireland-8.0-6.5
Netherlands-1.6-1.3

In the global dairy market, trends vary widely among significant exporters. Australia has recently shown resilience with a 3% growth. Conversely, the United States and New Zealand faced declines, with the US seeing a slight decrease and New Zealand a more significant 4% drop

The situation is more severe in South America. Argentina’s milk production shrank by 16%, and Uruguay’s fell by 7% in April, highlighting regional challenges. In contrast, the combined volume of significant dairy exporters, including the EU, saw a modest 0.3% increase (0.35 billion kg) up to April 2024. These trends illustrate the diverse fortunes and impacts in the global dairy market.

Market Dichotomy: Butter Price Volatility Versus Skimmed Milk Powder’s Competitive Pressures

ProductDatePrice (€/100 kg)
Butter3/7/24670
Butter29/5/24668
Butteravg. 2023476
Skimmed Milk Powder3/7/24241
Skimmed Milk Powder29/5/24248
Skimmed Milk Powderavg. 2023242

The European dairy market paints a nuanced picture of butter and skimmed milk powder pricesButter prices saw significant volatility in early 2024, rising sharply from mid-May to early June before stabilizing due to unexpectedly cool summer temperatures reducing cream demand. This stabilization has introduced uncertainty into the butter market. 

Conversely, skimmed milk powder prices have been relatively stable but face competitive pressures from cheaper US and Oceania imports. Demand unpredictability, especially in Asian markets, has also contributed to minor price decreases through June, highlighting ongoing challenges in the market.

The Bottom Line

The European market presents a mix of trends as the Dutch milk supply declines due to biological and regulatory challenges. However, the EU sees growth, driven by Poland, while Ireland faces declines. European milk prices, buoyed by sustainability premiums and bonuses, remain stable amid global volatility. Globally, the EU’s stability contrasts with declines in New Zealand and Argentina. These contrasting trends underscore the potential for growth and the need for innovation and collaboration within the global dairy sector. 

The dairy sector is currently grappling with biological strains, regulatory burdens, and economic challenges, all impacting profitability and market consolidation. Smaller farms are particularly at risk. In this context, strategic adaptive measures and support systems are crucial. It’s a call to action for policymakers, stakeholders, and farmers to unite, using sustainability initiatives to counter economic strains and ensure food security. The industry’s resilience is evident, but proactive regulation, sustainability, and financial support are essential. A combined effort is needed to enhance dairy farming. This analysis underscores the need for innovation and collaboration within the global dairy sector.

Key Takeaways:

  • The Dutch milk supply has continued its downward trend, recording a 1.6 percent decrease in May 2024 as compared to May 2023, attributed to the bluetongue virus and changes in derogation policies.
  • Despite the Dutch decline, the overall milk supply in the European Union increased by 1.1 percent over the first four months of 2024, driven by significant growth in Poland and slight increases in Germany, while Ireland’s output fell sharply.
  • European milk prices have shown remarkable stability, averaging around 44 euros per 100 kg since January 2024, buoyed by various sustainability surcharges and bonuses across different countries and companies.
  • Globally, major dairy exporters illustrated mixed trends, with Australia’s supply growing, while Argentina and New Zealand experienced substantial declines.
  • The Dutch dairy product market exhibited volatility, notably in butter prices, while skimmed milk powder prices faced competitive pressures from cheaper US and Oceania products, leading to slight decreases in June.

Summary:

The Dutch dairy industry is experiencing a’milk lake’ due to a decline in production due to the bluetongue virus outbreak and regulatory changes. The EU’s milk supply has increased, with Poland and Germany contributing to the overall supply. Ireland and France are struggling with declines. Sustainability premiums and bonuses contribute to market stability and milk prices. Global dairy market trends vary among exporters, with Australia showing resilience with a 3% growth, while the US and New Zealand face declines. South America’s situation is more severe, with Argentina’s milk production shrinking by 16% and Uruguay’s falling by 7%. Policymakers, stakeholders, and farmers must unite to counter economic strains and enhance dairy farming.

Learn more:

Ireland Achieves World’s Highest Sexed Semen Conception Rates

Find out how Ireland reached the highest sexed semen conception rates worldwide. Get insights from NCBC CEO Doreen Corridan on how to breed dairy cows for better performance.

According to National Cattle Breeding Centre (NCBC) CEO Doreen Corridan, Ireland has shockingly reached the highest sexed semen conception rates worldwide at 60%. She said this last Thursday at Portlaoise’s Irish Grain and Feed Association (IGFA) conference.

“The advantage of the high fertility that’s natural in our current dairy herd at the moment is that we’re getting the highest conception rates worldwide with sexed semen,” she said.

Emphasizing Ireland’s dairy herd’s natural fertility, Corridan ranked the country above others with bovine reproductive performance. She also covered the critical ramifications for cattle control and environmentally friendly dairy operations.

Aiming not just at assuring a lifetime of exceptional performance but also at optimizing dairy cow breeding, Corridan’s speech centered on the urgent need to maximize immediate production. This all-encompassing strategy, underlined at the Irish Grain and Feed Association (IGFA) conference in Portlaoise, is crucial to creating a sustainable dairy business that harmonizes economic viability with efficiency and animal health.

One main benefit of Ireland’s dairy herd’s great fertility is the increased efficiency and production it offers for dairy producers. Ireland establishes a worldwide standard with the most excellent conception rates utilizing sexed semen, therefore promoting sustainability and economic growth. This increase in fertility guarantees a continuous supply of heifer calves, thus supporting the excellent genetic quality of the herd.

These successes have global relevance. Ireland’s developments in genetic selection and reproductive technologies are a worldwide model. The global dairy sector sees Ireland’s targeted breeding initiatives as a road map for better, more efficient dairy cows, which supports environmental and economic goals.

When examining Corridan’s idea for the future sustainable cow, economics takes center stage. A productive cow emphasizes the wise use of resources and helps the farmer maintain economic stability. Equally important is carbon efficiency, which fits the increasing requirement to reach environmental goals and reduce the dairy sector’s carbon footprint.

Profitability and labor efficiency go hand in hand as a cow that needs less intervention and management results in reduced running expenses and more simplicity of farm operations. Long lifespan and health are natural; a healthy cow lowers the frequency and cost of replacements, promoting long-term sustainability.

Furthermore, it is impossible to overestimate the ability to generate valuable calves. Whether these calves support the meat sector or replace the dairy herd, their inherent worth remains excellent. Farmers match market needs and improve general herd output by producing fewer male dairy calves and more valuable heifer and beef calves.

Although this technique meets the market’s needs and general herd output, it is still essential to underline the double value of dairy and beef calves. Heifer calves are precious to dairy producers as replacements so that their herds may be kept growing and improved. These heifer calves constitute a significant investment in the future of the dairy business because of their possible high milk output and better genetic features. On the other hand, beef calves taken from the dairy herd must also satisfy quality criteria if they are meant to keep or raise their market worth. This dual-focus approach emphasizes the crucial part sexed semen technology plays in fulfilling the many demands of contemporary cow farming, hence improving both the immediate and long-term output of dairy and beef enterprises.

Corridan underlined the importance of sexed semen use in Ireland and the fact that over thirty of the replacement herds now result from its application. Driven by the dual benefits of increasing heifer calves from genetically better cows and lowering undesired male calf numbers, this adoption rate marks a radical change in herd management. Farmers improve the genetic quality of their replacement heifers and solve urgent problems related to animal welfare and the carbon economy by carefully using sexed semen. Thus, this approach leads the front stage in contemporary cow breeding as it fits more general sustainability and profitability objectives in the dairy industry.

For dairy herd owners, the advantages of sexed semen go well beyond essential herd growth. Sexed semen helps farmers significantly speed genetic improvement by providing a better chance of heifer calves from higher Economic Breeding Index (EBI) cows. This emphasis on genetic quality implies that cows with higher milk output and efficiency will occupy ever more of the future herd. Often presenting management and market value issues, this deliberate breeding method dramatically lowers the number of male calves.

Moreover, lowering male calves directly helps to meet higher animal welfare criteria and significantly improves farm carbon footprint. Reducing the percentage of less desirable male dairy calves can help farmers better control their cattle numbers, lessen the environmental impact, and match their activities with sustainable objectives. Thus, the use of sexed semen is a vital driver of economic and environmental improvements within the dairy sector, thereby demonstrating its essential function in contemporary, ethical herd management.

From over 30% to a paltry 3% of the calf population, this decrease represents a radical change in dairy production methods. The significant decline in male dairy calves increases the total value obtained from the herd and helps to solve the problems related to controlling extra males. Dairy producers may concentrate on raising high-value heifer calves and improving their production methods as fewer male calves allow them. This strategy change so encourages more sustainable and effective herd management, thereby matching economic incentives with environmental needs.

Corridan claims they achieved a historic first in Irish dairy farming last year when meat from the dairy herd exceeded dairy calves for the first time. This change highlights the rising tendency of dairy producers to include beef output in their activities. From 2013 to present, “Beef from the dairy herd has doubled and makes over 65% of all beef output. Angus and Hereford breeds account for 85% of this rise,” she said.

This trend shows a notable change in herd management techniques, where the dual use of dairy cows is being fully appreciated. Dairy producers may generate a more substantial percentage of beef calves by using sexed semen and high fertility rates. Therefore satisfying market needs while maintaining lucrative and efficient operations. This deliberate change thereby diversifies revenue sources and advances environmentally friendly agricultural methods.

Finally, figures show a fantastic increase in beef coming from dairy herds. Comprising nearly 65% of all the meat produced, the count of beef calves from dairy cows has risen since 2013. With 85% of the beef calves coming from Angus and Hereford breeds, particularly highlighting the strategic integration of dairy and beef output to satisfy changing market needs effectively,

Key Takeaways:

  • Ireland leads globally in bovine sexed semen conception rates, highlighting the high fertility of its current dairy herd.
  • A sustainable cow of the future must be profitable, carbon efficient, labor efficient, healthy, and capable of producing valuable calves.
  • Approximately 30% of the replacement herd in Ireland is now sourced using sexed semen, significantly reducing male dairy calves.
  • The number of beef calves from the dairy herd has doubled since 2013, surpassing the number of dairy calves from the dairy herd last year.
  • Angus and Hereford beef calves account for 85% of the calves from the dairy herd, emphasizing their growing significance in the market.

Summary:

Ireland has the highest sexed semen conception rates globally, thanks to its natural fertility and focus on bovine reproductive performance. National Cattle Breeding Centre CEO Doreen Corridan highlighted the importance of cattle control and environmentally friendly dairy operations at the Irish Grain and Feed Association (IGFA) conference. Ireland’s high fertility benefits dairy producers by increasing efficiency, promoting sustainability, and economic growth. This increase in fertility ensures a continuous supply of heifer calves, supporting the excellent genetic quality of the herd. Corridan’s idea for the future sustainable cow emphasizes economics, carbon efficiency, and long lifespan and health. Farmers can match market needs by producing fewer male dairy calves and more valuable heifer and beef calves. Over thirty replacement herds have been resulting from sexed semen use in Ireland, improving the genetic quality of replacement heifers and solving animal welfare and carbon economy problems. Corridan claims that meat from the dairy herd exceeded dairy calves for the first time in Irish dairy farming last year.

How Farmer Protests Influenced the Outcome of the EU Elections: A Shift in Agricultural Policy?

Find out how farmer protests shaped the EU elections and changed agricultural policies. Can the new parliament balance environmental goals with farmers’ needs?

Picture the scene: the rumble of tractors on roadways, farmers gathering outside parameters, their determination palpable. As farmers express their mounting discontent just as the European Parliament elections loom, this scene unfolds across Europe. These protests underscore a fundamental conflict in European policy: the delicate equilibrium between agricultural livelihoods and environmental regulations.

One activist outside the EU Parliament declared: “We’re not just fighting for our farms; we’re fighting for our future.” This statement encapsulates the unwavering spirit of these farmers, who are not just protesting, but also advocating for a sustainable future.

The timing of these demonstrations is strategic. Farmers are determined to be heard and to influence the outcomes as elections loom. This clash of interests has the potential to reshape EU policy and the European Parliament in the future, offering a glimmer of hope for a more balanced approach.

From Green Surge to Grassroots Outcry: The Genesis of Europe’s Farmer Protests

The farmer’s demonstrations followed the 2019 EU elections when the Green Party’s ascent changed the European Parliament. The Green Party, which has a strong focus on environmental issues, has been instrumental in driving faster legislation aimed at greenhouse gas emissions, water quality, fertilizer use, and animal waste management. While these regulations are aimed at protecting the environment, they have also been a source of contention for farmers who feel that they are being unfairly burdened. This political context is crucial for understanding the origins and implications of the farmer protests.

Rules set in Ireland a 25% drop in greenhouse gas emissions by 2030, suggesting changes in herd size. Farmers in the Netherlands were compelled to either shrink or leave the sector to satisfy rigorous emission regulations. These quick policy changes caused great disturbance among farmers.

Farmers reacted with mass demonstrations, blocking roads with tractors to show outside parameters. These acts brought attention to the conflict between quick environmental rules and the ability of the agriculture industry to change.

The demonstrations emphasized the necessity of balanced policies considering ecological sustainability and farmers’ livelihoods. They also highlighted the conflict between agricultural methods and environmental preservation. This dynamic shaped the most recent European Parliament elections in great part.

The Double-Edged Sword of Environmental Regulations: Farmers Caught in the Crossfire 

Strong rules impacting agriculture, especially those on greenhouse gas emissions, water quality, fertilizer consumption, and animal waste management, drive these demonstrations. These well-meaning rules burden farmers heavily and force them to strike a careful balance between compliance and financial survival.

In Ireland, agriculture must decrease greenhouse gas emissions by 25% by 2030, a target that indeed calls for smaller herds and significantly affects farmers’ way of life. Besides reducing production capacity, culling animals compromises generational family farms’ financial stability and viability.

Strict rules to lower nitrogen emissions in the Netherlands have driven farmers to trim their herds, which has caused significant demonstrations, including tractor blockades. Government attempts to turn rich land into nature zones further jeopardize farmers’ capacity to grow food, aggravating their unhappiness.

Tougher rules on animal waste management and fertilizer use have made things worse throughout Europe. Farmers must use precision farming methods, which increases running expenses. Following new waste rules calls for large expenditures that would tax small—to medium-sized farmers.

These illustrations show how strict environmental rules contradict farming methods, crystallizing into a hotspot of conflict. Though meant to lessen agriculture’s environmental impact, the implementation sometimes ignores the social and financial reality experienced by farmers serving the continent.

Revolt on the Roads: Tractors, Traffic, and the Theater of Protest 

Farmer European demonstrations have grown more visible and influential, distinguished by spectacular strategies. Often forming convoys, tractors block main roads and cause substantial traffic disturbance. These acts have progressed from rural regions to political capitals. Protests against rigorous environmental rules are symbolized by demonstrations outside parameters using banners and the roar of agricultural machines.

These demonstrations are very broad and forceful. Farmers throughout Europe are unified in their cries, from the Netherlands’ level landscapes to Ireland’s verdant fields. The large number of participants and wide geographical coverage have attracted interest from across the world. High-profile events like public rallies and blockades are meticulously scheduled to draw attention to the urgency and dissatisfaction within the agricultural community, therefore drawing both local and foreign media coverage.

Shifting Sands: How Nationalist and Populist Gains are Redefining EU Agricultural and Climate Policies 

Recent EU elections have shown a significant turn towards nationalist and populist parties within the European Parliament. This ideological shift will affect legislative procedures, particularly in agricultural policy and climate change. 

Often, nationalist and populist groups prioritize national sovereignty and economic pragmatism above group environmental projects. Their growing power suggests that future laws encounter more thorough reviews or robust opposition. Previously fast-tracked by the Green-dominated parliament, climate projects could be shelved or reassessed to balance environmental requirements and financial constraints.

Furthermore, agriculture policies—which form the foundation of the controversial environmental rules—will probably generate a lot of discussions and maybe changes. These parties reject specific rules and closely relate to rural and agricultural populations. This change might result in policies giving farmers more freedom and relieving some of the regulatory burden, causing extensive demonstrations. However, it’s important to note that these changes could also have negative environmental impacts, such as increased greenhouse gas emissions or water pollution. Striking a balance between the needs of farmers and the need for environmental protection is a complex task that requires careful consideration.

The next parliament could be essentially a two-edged sword. It might also hold down critical environmental projects, changing the EU’s climate policy and commitment to ecological standards, even as it pledges to include more represented voices from the farm sector in legislative debates.

Political Realignment: A New Dawn for Environmental and Agricultural Policies

The European Parliament’s new political environment indicates a possible slowing down environmental rule speed. As Nationalist and Populist parties gain traction, we could see a movement toward policies that strike a mix between environmental aspirations and agricultural and financial requirements. 

Right-leaning politicians might advocate a more farmer-friendly approach, enabling agricultural viewpoints to impact laws. This may involve lowering emissions objectives or offering more reasonable compliance deadlines, relieving some immediate pressure on farms to adopt new methods.

Moreover, a mutual cooperation between authorities and farmers might develop. Agricultural players may participate more actively in policy debates and provide helpful analysis to help balance agricultural sustainability with environmental preservation. This could lead to the development of policies that combine contemporary technologies, support environmentally friendly behavior, and guarantee the industry stays competitive. However, it’s important to note that this cooperation could also lead to a weakening of environmental regulations, which could have negative environmental impacts. The outcome of this debate will have significant implications for the future of EU agricultural and environmental policies.

The Bottom Line

The growing farmer demonstrations throughout Europe highlight a crucial juncture for EU agriculture policy and the larger political scene. Inspired by the Green Party’s recent successes stemming from growing environmental rules, these demonstrations have shown the significant influence of such policies on the rural population. From blocking roads to organizing outside parliaments, the tactical actions highlighted farmer complaints. They pushed a review of the balance between environmental sustainability and agricultural livelihoods. The outcome of this review could have far-reaching implications for EU agricultural and environmental policies, potentially leading to a more balanced approach that takes into account the needs of both farmers and the environment.

The current rightward movement in the European Parliament exposes a rising opposition to fast green programs. It points to possible legislative changes on agricultural problems and climate. This political realignment implies that even while environmental rules will always be important, their execution may run into delays or changes to better address farmers’ issues.

Looking forward, the more significant consequences of these demonstrations may change agriculture policy and EU elections. They underline the need for legislators to interact more closely with the agricultural community to ensure that the pragmatic reality farmers live with is not subordinated to environmental objectives. Juggling these dual demands will help create sustainable, practical policies that respect both ecological and financial imperatives, opening the path for a more inclusive response to climate change.

Key Takeaways:

  • Green Party Influence: The 2019 surge of the Green Party in the European Parliament has accelerated the implementation of stringent climate policies.
  • Regulatory Pressures: Farmers face increasing regulations on greenhouse gas emissions, water quality, fertilizer usage, and animal waste management.
  • Major Targets: Ireland’s mandate for a 25% reduction in agricultural greenhouse gas emissions by 2030 exemplifies the EU’s ambitious environmental goals.
  • Protest Movements: Widespread farmer protests, featuring tractors blocking major highways, have drawn international attention and underscored farmers’ discontent.
  • Political Shift: The recent shift towards the right in the EU Parliament aligns more closely with farmers’ interests, potentially slowing the pace of new environmental regulations.
  • Future Legislation: The newly formed parliament may exhibit increased sympathy towards the agricultural sector, potentially rethinking some prior environmental policies.


Summary; Farmers across Europe are protesting against the balance between agricultural livelihoods and environmental regulations as the European Parliament elections approach. The Green Party’s rise in the European Parliament has led to faster legislation on greenhouse gas emissions, water quality, fertilizer use, and animal waste management. These regulations aim to protect the environment but have also been a source of contention for farmers who feel unfairly burdened. The timing of these demonstrations is strategic as farmers are determined to be heard and influence the outcomes as elections loom. The next parliament could be a two-edged sword, holding down critical environmental projects, changing the EU’s climate policy, and committing to ecological standards.

EU Dairy Decline: 2024 Milk Production Forecasted to Drop 0.3% Amid Lower Cow Numbers and Rising Costs

Discover why EU milk production is forecasted to drop 0.3% in 2024. How will declining cow numbers and rising costs impact the dairy industry? Read more to find out.

EU Flag waving against blue Sky

European Union milk production is set to face another challenging year, continuing its downward trend into 2024. Several factors contribute to this decline, with a predicted 0.3% drop in cow milk production. As the number of dairy cows falls below 20 million for the first time, it’s evident that consistent growth in cow productivity won’t fully offset the shrinking cow inventories. Rising production costs and lower farm-gate milk prices further exacerbate the situation, making milk production less profitable for EU farmers.  Join us as we delve further; these elements paint a comprehensive picture of the EU’s milk production landscape in 2024.

EU Dairy Herds Dwindling: First-Ever Drop Below 20 Million Cows Marks 2024’s Start

CountryDairy Cows in Milk (January 2024)Expected Change in Dairy Farmer Numbers (2024)Milk Production (Forecast for 2024)
Germany4.0 millionDecreaseStable
France3.5 millionDecreaseSlight Decrease
Poland2.8 millionDecreaseSlight Increase
Belgium0.6 millionDecreaseSlight Decrease
Netherlands1.6 millionMinimal ChangeStable
Ireland1.5 millionMinimal ChangeDecrease

At the start of 2024, the EU saw a significant change in its dairy industry: dairy cows dropped below 20 million, hitting 19.7 million. This marks a historic low and indicates a continuing downward trend in cow numbers, which is expected to persist throughout the year.

The Double-Edged Sword of Rising Cow Productivity Amid Shrinking Herds

Even though each cow produces more milk, more is needed to make up for the overall decline in cow numbers across the EU. Simply put, fewer cows mean less milk overall. This imbalance contributes directly to the forecasted 0.3% drop in milk production for 2024. Despite individual productivity gains, the milk output is declining due to the shrinking herds.

A Temporary Respite: Early 2024 Sees Milk Deliveries Surge Before Expected Decline

Time PeriodMilk Deliveries (MMT)Change (% Year-on-Year)Average Farm Gate Milk Price (EUR/100kg)

January-February 2023 24.0 – 40.86

January-February 2024 24.4 1.7% 35.76

Full Year 2023 145.24 -0.03% 39.50

Full Year 2024 (Forecast) 144.8 -0.3% 37.00

Early 2024 saw a 1.7% rise in cow’s milk deliveries compared to the same period in 2023. However, this boost is short-lived. Many farmers are expected to sell their cows or exit milk production later in the year, leading to a decline in deliveries.

The Multifaceted Challenges Shaping Europe’s Dairy Economy

The economic landscape for dairy farmers is becoming more challenging. A key issue is the steady drop in farm-gate milk prices since early 2023, significantly affecting profitability. 

Production CostsHigh production costs for energy, fertilizers, and labor persist, squeezing farmers’ margins despite some recent reductions. 

Geographical Impact: In Germany, France, Poland, and Belgium, smaller and less efficient farms are hardest hit. The pressure from lower milk prices and high input costs drives many to reduce herd sizes or stop milk production. 

Environmental RegulationsEnvironmental rules in the Netherlands and Ireland seek to cut nitrogen emissions, which are expected to negatively affect herd numbers and production costs in the long term. 

Overall, larger farms may better cope, but the trend toward consolidation continues due to falling profits and rising costs.

Environmental Regulations Cast Long Shadows Over EU Dairy Farming

Environmental regulations are threatening Europe’s dairy farming. New measures to curb nitrogen emissions are adding pressure on struggling farmers in the Netherlands and Ireland. 

For example, the Netherlands aims to cut nitrogen emissions by 50% by 2030, including reducing the number of dairy cows and relocating farms. Ireland’s targets similarly demand stricter manure management and sustainable farming practices, both costly and complex. 

These regulations, combined with high production costs and declining milk prices, make it challenging for smaller farms to stay in business. Many are choosing to exit the market rather than invest in expensive upgrades. 

As a result, smaller farms are shutting down, and larger farms need help to maintain their herd sizes. Although these regulations are essential for a greener future, they add another layer of complexity to the EU dairy industry’s challenges.

Generation Renewal Crisis Accelerates Market Consolidation in EU Dairy Sector

A growing trend in market consolidation and farm closures is evident within the EU dairy sector. One key issue here is the challenge of generation renewal. Younger generations are increasingly hesitant to continue milk production due to the heavy workload and tight profit margins. Elevated production costs and decreasing farm-gate milk prices also make it challenging for smaller, less efficient farms to stay in business. 

However, larger and more professional farms show notable resilience. They often have better infrastructure, access to advanced technology, and excellent financial stability, allowing them to maintain herd numbers despite broader declines. By leveraging economies of scale and more efficient practices, these farms can better absorb economic shocks and comply with environmental regulations. 

This disparity between small and large farms is accelerating market consolidation. As smaller farms exit, larger ones are absorbing their market share. While the total number of dairy farms is decreasing, those that remain are becoming more advanced and better equipped to tackle future challenges in the dairy economy.

Record-High Milk Prices in 2022 Spark Production Surge, Only to Shatter in 2023-2024

The surge in milk deliveries in 2022 and 2023 stemmed from record-high EU farm gate milk prices in 2022, peaking in December. These prices incentivized farmers to boost production despite rising costs, supporting the dairy industry at that time. 

However, these prices began to fall from May 2023 through March 2024, squeezing farmers financially. Although still above the 5-year average, the decline sharply contrasted with 2022’s profitability. With global milk production up and dairy demand fluctuating, EU farmers adjusted their production levels, paving the way for a predicted drop in milk deliveries in 2024.

The Ripple Effect: How Global Market Dynamics Shape EU Milk Prices 

Global market dynamics significantly impact EU milk prices. The world’s largest dairy exporters, including Australia, the United States, the UK, and New Zealand, have increased production, leading to an oversupply that pressures prices downward. This makes it challenging for EU producers to maintain their margins. 

Simultaneously, demand from major importers like China and some Middle Eastern countries is declining. Various factors, including trade tensions and shifting consumer preferences, contribute to this weaker demand. 

This supply-demand imbalance has reduced farm gate milk prices in the EU. While European prices remain higher than those of international competitors, more than this advantage is needed to counteract the rising production costs and reduce global demand. The EU dairy industry must navigate these challenges to stay competitive and sustainable.

Price Disparities in Global Dairy: EU’s Costly Position Against New Zealand and US Competitors

When you look at milk prices, you’ll notice that the EU’s are much higher than those of other major exporters like New Zealand and the US. In February 2024, the EU’s milk price hit EUR 46.42 per 100 kilograms. That’s 27% more than New Zealand’s and 18% more than the US. 

These higher prices mean EU dairy products cost more to produce and sell, making it challenging for EU producers to compete globally. Higher costs can squeeze farmers further, especially with high input costs and changing demand.

Weather Woes: Uneven Conditions Across Europe Impact Dairy Farming

In 2024, weather was vital in shaping feed and pasture conditions across Europe. Spring brought warm temperatures and balanced rainfall, leading to good green feed availability. However, the northwest, especially Ireland, faced challenges. Ireland’s dairy farming, which relies on cattle grazing for up to nine months, has struggled with wet soils and recent rains. These conditions hindered field access and grassland regrowth, severely impacting milk production.

The Bottom Line

In summary, EU milk deliveries are forecast to dip to 144.8 million metric tons (MMT) in 2024. Unfavorable weather and high input costs for energy and fertilizers are straining farmer margins. Despite brief boosts in productivity, these challenges will likely persist throughout the year.

Key Takeaways:

  • Decline in Cow Numbers: Cow numbers fell below 20 million for the first time in early 2024, indicating a continuing downward trend.
  • Productivity vs. Herd Size: Increased productivity per cow is not enough to counterbalance the overall decrease in herd sizes.
  • Initial Surge in Milk Deliveries: Early 2024 saw a 1.7% increase in milk deliveries, but this is expected to decline as more farmers exit the industry.
  • Decreasing Profitability: Farm-gate milk prices have been falling since early 2023, alongside high production costs, squeezing farmers’ profit margins.
  • Impact of Environmental Regulations: Government plans to cut nitrogen emissions in countries like the Netherlands and Ireland are affecting herd numbers.
  • Market Consolidation: The industry is seeing greater consolidation, with smaller, less efficient farms closing and bigger farms maintaining their herd sizes.
  • Weather Complications: Varying weather conditions across Europe in 2024 have impacted green feed availability and pasture conditions, particularly in Ireland.

Summary: The European Union’s milk production is experiencing a significant decline, with a predicted 0.3% drop in cow milk production. This decline is attributed to rising production costs and lower farm-gate milk prices. The number of dairy cows has fallen below 20 million for the first time, making milk production less profitable for EU farmers. In early 2024, there was a 1.7% rise in cow milk deliveries compared to the same period in 2023, but this was short-lived as many farmers were expected to sell their cows or exit milk production later in the year. The economic landscape for dairy farmers is becoming more challenging, with a steady drop in farm-gate milk prices since early 2023 significantly affecting profitability. High production costs for energy, fertilizers, and labor persist, squeezing farmers’ margins despite some recent reductions. The EU dairy sector is experiencing a growing trend of market consolidation and farm closures, with younger generations increasingly hesitant to continue milk production due to heavy workloads and tight profit margins.

Declining Dutch Milk Supply Contrast with Growing European Production; Prices Slightly Down

Explore the reasons behind the decline in Dutch milk supplies as European production rises. What does this mean for milk prices and the future of dairy farmers? Continue reading to uncover the details.

The divergence in milk supply trends between the Netherlands and Europe is a significant development. In April, Dutch dairy farmers produced 1.4% less milk than last year, while Europe witnessed a 0.6% rise in March and a 1.2% increase in the first quarter of 2024. 

The contrasting milk supply trends in Poland and Ireland, with a 4% growth and a 6% decline respectively in March, underscore the regional variations that significantly impact the dairy industry.

Dutch farmers are grappling with challenges such as bluetongue and reduced derogation, resulting in a 57 million kg (1.2%) drop in the first four months of 2024. However, the growth in Belgium, Germany, and France is helping to offset these declines, demonstrating the resilience of the dairy industry in the face of adversity. These mixed trends paint a complex but hopeful picture of the dairy industry landscape across Europe.

Cloudy Skies Over Dutch Dairy: April 2024 Milk Deliveries Slump

PeriodMilk Supply (million kg)Change Compared to Previous Year
January 20241,320-1.5%
February 20241,100-1.0%
March 20241,400-0.9%
April 20241,350-1.4%

The latest data paints a sobering picture of the Dutch milk supply. In April 2024, dairy farmers in the Netherlands faced a 1.4 percent decrease in milk deliveries compared to last year. This decline is part of a broader trend, with the first four months of 2024 seeing a total reduction of 57 million kilograms of milk, or a 1.2 percent drop, compared to the same period in 2023. Such statistics underscore significant challenges facing the Dutch dairy sector.

Factors Influencing Dutch Milk Decline: Disease and Regulation Tightening

It’s crucial to understand the factors that have led to the decline in Dutch milk supply. The main contributors are the aftermath of bluetongue disease, which affects cattle, and the reduction of special permissions allowing farmers to exceed EU nitrogen limits. These tighter restrictions on nitrogen usage mean less intensive dairy farming practices. By understanding these factors, stakeholders can be better informed about the challenges Dutch dairy farmers are facing.

Europe’s Milk River Flows Stronger: March 2024 Sees Notable Increase in Deliveries 

CountryMilk Supply Growth in March 2024
Poland+4%
Belgium+0.6%
Germany+0.6%
France+0.6%
Ireland-6%

While Dutch dairy farmers are experiencing a decline, Europe as a whole is showing a different trend. In March 2024, milk deliveries across Europe increased by 0.6 percent. The first quarter of 2024 saw European dairy farmers delivering 1.2 percent more milk than in 2023. Regions like Belgium, Germany, and France showed modest increases, indicating a stable milk collection across the EU despite challenges in places like Ireland. These contrasting trends are significant and should be noted by all stakeholders in the dairy industry.

Spotlight on Individual Countries: Poland’s Surge and Ireland’s Woes

CountryTrendPercentage Change
PolandIncrease+4%
IrelandDecrease-6%
BelgiumIncrease+0.6%
GermanySlight Increase+0.3%
FranceIncrease+0.6%
NetherlandsDecrease-1.2%

Looking closer at individual countries, you’ll see some clear trends. Poland is the most vigorous climber in March, showing a solid 4% increase in milk supply. This boost is thanks to favorable weather and better dairy farming practices. On the flip side, Ireland saw a significant drop, with a 6% decrease in milk supply due to extreme wetness impacting pasture conditions.

April Showers Bring Price Lowers: Tracking European Milk Price

CountryApril 2024 Price (€ per 100 kg)March 2024 Price (€ per 100 kg)% Change
Netherlands44.1044.30-0.45%
Belgium43.8543.95-0.23%
Germany44.2044.35-0.34%
France43.7543.85-0.23%
Poland43.6043.70-0.23%
Ireland42.8043.30-1.15%

European milk prices dipped slightly in April. The average was 43.97 euros per 100 kg, down by 0.49 euros from March. This small drop mainly stems from seasonal factors and specific challenges, like the wet weather in Ireland, which impacted bonuses.

Weather Woes and Economic Ripples: Unpacking the April Dip in European Milk Prices

Several factors contributed to the slight drop in European milk prices in April. A key factor was the removal of bonuses by some Irish factories due to extreme wetness in Ireland, which disrupted farming conditions. Additionally, stabilizing milk collections across Europe and a 6% decrease in energy costs in Q1 2024 also played roles. These combined influences created a ripple effect, slightly nudging average milk prices downward.

The Bottom Line

The milk supply in 2024 shows a clear contrast. Dutch dairy farmers saw a 1.4% drop in April deliveries due to bluetongue and new regulations. In contrast, European dairy producers enjoyed a 1.2% increase in the first quarter. However, April’s European milk price fell slightly to 43.97 euros per 100 kg, influenced by the removal of seasonal bonuses in Ireland.

Discover why Dutch milk supply is declining while European production grows. How will this impact milk prices and dairy farmers? Read more to find out.

  • The Netherlands saw a 1.4% decline in milk deliveries in April 2024 compared to April 2023.
  • From January to April 2024, Dutch milk supply decreased by 57 million kg (-1.2%) compared to the same period in 2023.
  • The decline in the Netherlands has been linked to the aftermath of bluetongue disease and stricter regulations reducing derogation allowances.
  • Conversely, European countries overall experienced a 0.6% increase in milk supply in March 2024.
  • Poland recorded the highest growth at 4% in March 2024, while Ireland faced the steepest decline at 6%.
  • Average European milk prices decreased slightly in April 2024 to 43.97 euros per 100 kg of milk.
  • The price drop was partially due to the removal of bonuses in Irish factories, attributed to extreme wet weather conditions.

Summary: Milk supply trends in the Netherlands and Europe have shown significant differences. Dutch dairy farmers experienced a 1.4% decrease in milk deliveries in April 2024 compared to last year and a 1.2% drop in 2023. This decline is part of a broader trend, with the first four months of 2024 seeing a total reduction of 57 million kg of milk. Factors influencing this decline include the aftermath of bluetongue disease and the reduction of special permissions allowing farmers to exceed EU nitrogen limits. In March 2024, Europe’s milk river flowed stronger, with deliveries increasing by 0.6%. Belgium, Germany, and France showed modest increases, while Poland saw a 4% increase due to favorable weather and better dairy farming practices. European milk prices slightly dropped in April.

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