The European Commission has opted for the self-regulation of the dairy market, despite the pressure of rising production costs on farms and market instability.
According to preliminary data from the European Commission, in March 2026, the average raw milk price in the EU was 43.18 eurocents per kg, which is 1.77% lower than in February 2026. Compared to the price as of March 2025, milk in the EU has become 18.82% cheaper. In March, the price for extra-grade milk in Ukraine stood at 30.37 eurocents per kg.
Despite calls from certain EU member states to introduce support for raw milk production to stabilize purchase prices, the European Commission rejected these proposals, choosing to rely on market self-regulation. The EU did not support the idea of reducing raw milk production due to the rising prices of finished products, particularly milk powder. It was the increase in milk powder prices that served as a driver to halt the decline in raw milk prices in Ukraine and caused a slight increase. Furthermore, uncertainty persists in the EU dairy market, and the European Commission doubts that raw milk supply will grow at the same pace in 2026 as before. Milk production growth in 2026 is expected not to exceed 1%, compared to 2.8% in 2025. The market is expected to regulate production independently. Poland has proposed increasing payments to dairy farmers from the general EU budget, but this issue has been postponed due to a lack of additional funding.
The conflict in the Middle East has led to increased costs for farmers regarding electricity, fuel, fertilizers, and feed. Additionally, import restrictions on certain dairy products—primarily cheeses—by China are worsening the outlook for European exporters and creating risks for the Ukrainian cheese market, as surplus products may be redirected from Europe to Ukraine. According to Rabobank estimates, over 20% of EU dairy exports are affected by the conflict in the Persian Gulf region. As reported by Kieran Fitzgerald, Regional Manager for Bord Bia in the Middle East and Africa, large-scale disruptions in freight shipping and changes in logistics routes have significantly increased the costs of delivering export products to the region.
Press service of the Association of Milk Producers
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