EU Commissioner for Agriculture Phil Hogan said that he does not expect an increase in milk production this year.
Speaking at an EU press conference, the Commissioner said that the lack of increase is due to the fact that production already rose by 5.5 per cent last year.
According to Irish publication farmersjournal.ie, the Commissioner said that in order to deal with milk price volatility, market mechanisms are in place should a problem arise.
Hogan also addressed fears that there would be major volatility post-quota by citing predictions of a collapse in milk prices made last year, saying that prices are today the same as they were in January 2013. The average milk price now stands at 32.5c/litre.
Milk quotas were first introduced in 1984 at a time when EU production was moving too fast for the demand.
The quota regime was one of the tools introduced in overcoming these structural surpluses.
The final date to end quotas was first decided in 2003 in order to provide EU producers with more flexibility to respond to growing demand, especially on the world market.
The deadline was reconfirmed in 2008 with a range of measures aimed at achieving a "soft landing" for farmers when quotas are abolished on 31 March this year.
© 2015 European Supermarket Magazine – your source for the latest retail news. Article by Ciara Mooney.
