EU milk production forecast to be 1% higher this year

In 2015, milk deliveries in the EU are expected around 1% above last year and a further increase might be expected in 2016, the European Commissions Short-Term Outlook predicts.

Clear differences can be noticed between Member States with expected strong increases in volumes in the Netherlands, Ireland, Poland, the UK, Spain and Denmark, according to the outlook.

It found, however, that 2015 production should be lower than last year in France and Germany.

This overall increase might seem surprising given the strong reduction in the price of dairy commodities and of raw milk observed in the last months, however the time-lag from reduced milk prices to change in production levels is usually several months, it said.

The abundant number of dairy cows currently in production results from decisions taken by farmers at least one year ago.

Between April (the end of the quota system) and July, milk deliveries in the EU increased by around 2.5% compared to last year.

After the 1.3% reduction in milk deliveries recorded in the first quarter of the year, in order to limit over-quota production and the surplus-levies to be paid, the potential of the additional dairy herd could be fully exploited thanks to good grass availabilities in spring and reasonable feed prices, according to the outlook.

In the EU-15, the increase in the number of dairy cows registered in December 2014 (+0.8% compared to 2013) was further confirmed in the June-July livestock survey (+1.2% so far for the EU-15 Member States for which data is available).

The rise was particularly significant in Ireland (+5.7%), the Netherlands (+3.5%) and the UK (+2%).

By contrast, the number of dairy cows was quite stable in France, Spain, Italy, Belgium and Denmark, and down in Sweden, the outlook found.

It is expected that farmers in the EU-15 will slaughter additional dairy cows in reaction to lower milk prices.

While in the first half of the year, cow slaughterings rose by 3% only, they have started accelerating in July in some Member States like in the UK and Belgium.

This phenomenon could be amplified now that cows will go back into stables for the winter. Therefore, a slowdown in milk production growth is expected in the coming months.

For 2016, a further increase in milk production is expected because the dairy herd might once more be slightly up in the EU-15 by December 2015 (+0.4%) and also because the reduction in milk deliveries which was observed in the first quarter of 2015, to stay within quotas, will not take place in 2016, it found.

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