The Trends of EU Exports of Main Dairy Products

Abstract

The purpose of this paper is to analyze the recent trends of EU exports of main dairy products，especially butter，cheese，skimmed milk powder (SMP) and whole milk powder (WMP). The dairy sector is one of the most important agricultural sectors in the EU and has been exporting numerous dairy products to world markets since the introduction of the Common Agricultural Policy. That is to say，the EU, along with the United States，Australia and New Zealand, is one of the main exporting areas of dairy products to world markets.

As a result of the milk quota system (additional levy system) being abolished on 31 March 2015，dairy farmers in each EU member country are now at liberty to produce raw milk regardless of volume. The EU intends to take a positive attitude and adopt the market-oriented dairy policy in order to cope with global competition and to rigorously enter into world markets.

The present market conditions of dairy products are not favorable for the EU，partly because Russia, one of the most important established markets for the EU, imposes an embargo on the import of foods from the EU, and partly because China, one of the increasingly important target markets for the EU, is undergoing a recession. Meanwhile, milk production in the EU is increasing. That is why milk producer prices in EU member countries have gone down. The EU is now adopting Public Intervention and Private Storage Aid to separate a surplus of main dairy products from the market to support their prices.

However，an increase in demand of dairy products in world markets is expected thanks to an increase in population and income per capita in rising nations outside the EU. In addition，consumption of butter and cheese is increasing in Eastern Europe and the area is thus a promising market inside the EU. In conclusion, the EU will remain a leading exporter of main dairy products in the short term and will be able to successfully expand their export in the medium and long term.