No European milk flood this year, EU forecasts

The end of milk quotas will not cause a surge in European milk production this year, according to new forecasts.

The EU Commission’s latest short-term outlook expects the continent’s farmers to produce about 162bn litres of milk in 2015 – 1.2% more than last year.

Ireland, the Netherlands and Germany could see some of the strongest growth, having expanded their national dairy herds in 2014.

See also: Spanish dairies hit by fines for price-fixing

Milk supplies last year beat nearly all forecasts, rising 4.5% and putting extreme pressure on the price farmers were paid.

The commission’s report said EU deliveries would ease off in the first quarter of this year before increasing again once the limits are off.

“From April, when quotas are abolished, provided demand supports milk prices, milk collection could progressively rebound, given that forage availability is good and feed prices remain low,” the report said.

The other key points for other sectors were:

• Cereals: For the marketing year 2014-15, the record EU harvest will see imports down one-third and exports rise to a new high of 44.3m tonnes – 2% higher on the year. Final stocks will rise from 34.9m tonnes to 50m tonnes, taking the stocks-to-use ratio from 13% to 18%.
• Oilseeds: In the 2014-15 marketing year, a large harvest, low oil prices and a weakening euro could see imports fall and lead to a greater reliance on domestic use and stocks.
• Beef: The EU suckler cow herd grew 1.3% last year, with stronger increases in France and Spain. Beef and veal production could rise 1.5% in 2015, to 7.7m tonnes. However, recovering prices will limit any increase in consumption.
• Pigmeat: European production is expected to rise 1.2% to 23m tonnes, as sow and piglet numbers rise. Russia’s ban on EU food imports saw exports plunge 13% last year. Strong demand from Asia could see international sales bounce back 5% in 2015.
• Sheepmeat and goatmeat: EU production could grow just 0.3% to 937,000t this year, due to farmers holding on to animals and slaughterings slowing temporarily. Imports dropped 6.2% in 2014, with New Zealand switching shipments towards China. These could recover slightly this year.