Few young people, many challenges: the puzzle of the EU dairy sector

Brussels – Young people with little attraction and no vocation, expanding global production, unfair competition, climate change: the future of dairy and cheese in the European Union is fraught with obstacles and many challenges. The European Parliament Think Tank takes stock, noting that the situation for the dairy sector is far from ideal. First and foremost, there is a labor problem as producers are lacking.

According to an analysis, “many member states” show a “remarkably high” proportion of farmers aged 65 and older. In countries with a lower percentage of young farmers and the retirement age is higher than average, “the issue of generational renewal is particularly worrying.” Few farmers are ready to take over from those who allow the various dairy ‘made in’ to move forward.

The productivity problem is not new. From 2004 to 2022, the EU’s milk production increased from 134 million tons to 154 million tons, making the EU the world’s largest supplier of dairy products. “However, due to a major increase in global production over the same period, this also represents a fall in the EU share from 21.4% to 17.1 % of global milk production,” according to the report. European leadership is starting to erode, and the economic climate is not helping.

Also, sharply rising energy and fertilizer costs coupled with a decrease in raw milk prices, persistently high inflation, and rising interest rates, “there is still uncertainty about profit margins” for dairy farmers. Operators in the sector could go out of business since most farms in the EU dairy sector are highly specialized, according to the Think Tank analysts. Although specialization offers some advantages, it ties revenues to a single output. Such dependence can become a substantial threat, making farmers more vulnerable to income shocks. 

In addition, there are weather-climate issues. Extreme weather conditions — such as droughts, heat waves, and floods — “can have a significant impact on agriculture,” as in the 2018 ‘fodder crisis’ when hot and dry weather caused fodder and pasture shortages in several European countries, an acute problem for the EU livestock sector. More broadly, “cows can suffer from heat stress” when it is hot due to high temperatures and humidity. Heat stress negatively affects milk yields, fat percentage, and the reproductive performance of cows.

It doesn’t end there, as extreme weather conditions can lead to disease outbreaks. For example, very dry or very wet weather and flooding can increase the risk of anthrax, a contagious zoonotic disease.