European Milk Board Urges Supply Cuts as Falling Milk Prices Squeeze Dairy Farmers

The European Milk Board (EMB) has called on European policymakers to activate voluntary milk supply reduction measures, warning that declining milk prices and rising production costs are creating significant financial challenges for dairy farmers across the continent.

The appeal came during the EMB’s 20th General Assembly in Italy, where the organisation reflected on two decades of advocacy while highlighting growing concerns over the current state of the European dairy sector.

Dairy Sector Under Renewed Pressure

According to the EMB, increasing global milk production and weakening market prices are once again placing European dairy farms under severe economic strain. Although milk output continues to rise in several producing regions, farmgate returns are failing to keep pace with escalating input costs, including feed, energy, labour and environmental compliance expenses.

The organisation argues that without timely intervention, prolonged price weakness could accelerate farm closures, reduce rural incomes and further consolidate dairy production into fewer, larger operations.

“Twenty years of EMB show that producers can achieve real change when they stand together,” said EMB President Kjartan Poulsen.

Call for Voluntary Supply Reduction

A central demand from the EMB is the activation of the voluntary supply reduction mechanism, a market management tool designed to encourage farmers to temporarily reduce milk production during periods of oversupply.

The mechanism gained attention during previous dairy market crises, particularly following the abolition of EU milk quotas, when excessive supply contributed to sharp price declines and significant financial hardship for producers.

According to the EMB, reducing milk output in a coordinated manner can help rebalance supply and demand, supporting price stability and preventing deeper market disruptions.

“The current situation shows once more that Europe needs functioning market instruments,” Poulsen said. “Voluntary supply reduction is not a theoretical concept, but a necessary instrument for stabilising the milk market in times of crisis.”

The organisation also expressed concern over what it described as the reluctance of some EU member states and parts of the European Commission to implement such measures despite growing market pressures.

EMB’s Two Decades of Influence

Founded in 2006 as a grassroots initiative by dairy farmers, the EMB has evolved into a major voice in European dairy policymaking.

Among its notable achievements are:

• 📊 Establishment of the European Milk Market Observatory
• 📈 Development of scientific methodologies for calculating milk production costs
• 🥛 Promotion of mandatory contracts in the dairy sector
• ⚖️ Advocacy for market crisis management tools, including voluntary supply reduction schemes

These initiatives have contributed to greater transparency in dairy markets and strengthened discussions around fair remuneration for milk producers.

Fair Milk Projects Demonstrate Consumer Support

EMB Vice-President Boris Gondouin highlighted the success of the organisation’s Fair Milk initiatives, which promote dairy products sold at prices that ensure farmers receive fair compensation.

According to Gondouin, consumer response to these projects demonstrates increasing public willingness to support sustainable and fairly priced agricultural products.

“Fair Milk has shown that consumers are willing to support fair agriculture and that fair prices on the market are possible,” he said.

Outlook for the European Dairy Market

The EMB’s latest warning comes at a time when global dairy markets are facing mixed signals. Rising milk production in several exporting regions, combined with uncertain demand growth, is creating renewed concerns over potential oversupply.

Industry observers note that weather conditions, trade developments, consumer demand trends and policy decisions will play a critical role in shaping market direction during the remainder of 2026.

For European dairy farmers, however, the immediate priority remains securing mechanisms that can protect farm profitability and ensure long-term sector sustainability in an increasingly volatile market environment.