Forecast: EU Cheese Production to Increase 660,000 Metric Tons by 2020

After more than 30 years, EU milk quota limits end today.

For more than 30 years, European countries have imposed quotas on milk production. That era ends today. So what does it mean for cheese?

According to a U.S. Dairy Export Council analysis, the end of quota limits will lead to 660,000 more metric tons of EU cheese on the market in 2020 than 2013.

The finding comes from a new USDEC Executive Brief, "5 Data-Based Forecasts about the end of EU Milk Quotas." The brief is free to subscribers of the U.S. Dairy Exporter blog. Learn more here. 

Seventy-six percent of the extra milk is expected to come from just six of the 28 EU countries—Ireland, Denmark, France, Poland, Germany and the Netherlands.

While a recent European Commission report said there is not expected to be an immediate surge of EU milk production in 2015, a longer-term analysis by USDEC does show increases by 2020.

In terms of volume, the big winner will be cheese. 

Other commodities, such as butter and milk powder, will grow at a faster rate than cheese. USDEC projects that butter production in the six major dairy countries of the EU will grow at an annual rate of 2.1 percent and milk powder even more.

What will this mean for U.S. exports?

Additional dairy commodities produced by the EU will mean increased competition with the United States and other dairy-exporting nations.

The good news for U.S. dairy exporters is that USDEC research concluded that continued rising market demand would absorb increased EU volumes and still leave ample opportunity for U.S. suppliers in nearly all sectors.

This is addressed in detail in a 334-page USDEC study, "European Union: The Impact of the Removal of Milk Quotas in 2015." That study has been condensed into a six-page executive brief boiling down the data to five essential points for subscribers to this blog.

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The U.S. Dairy Export Council is primarily supported by Dairy Management Inc. through the dairy farmer checkoff that builds on collaborative industry partnerships with processors, trading companies and others to build global demand for U.S. dairy products.   

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