Agricultura y Desarrollo Rural

The "Milk Package"

The "Milk Package"

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Milk and milk products
The "Milk Package"

The so-called "Milk Package" was designed with a view to the longer-term future of the dairy sector following the end of the quota system in 2015. It has been fully applicable since 3 October 2012.

Implementation of the Milk Package

Slide show: Implementation of the Milk Package (update May 2019)

Producer Organisations campaign 2017/18

The Commission report to the European Parliament and to the Council on the operation of the Milk Package adopted in November 2016 year confirms the usefulness of the instrument and recommends a number of actions of a pedagogical, financial or operational nature.

The report emphasises how Producer Organisations (POs), the cornerstone of the Milk Package structure, have not yet reached their full potential, notably due to insufficient knowledge of farmers on the goals, implications and advantages deriving from joining into POs. The report concludes on the need to embark on awareness raising actions at different levels to spread the benefits of producer cooperation and to share experiences and best practices.

Following these conclusions, the Commission has launched a communication campaign, to be deployed in the last quarter of 2017 and throughout 2018, to promote the creation of Producer Organisations in the milk sector and to improve the functioning of existing ones.

The Milk Package report 2016

Implementation of the Milk Package

The Milk Package report 2014


Drafted on the basis of the conclusions of a special High Level group set up after the 2009 milk market crisis, this series of measures is aimed at boosting the position of dairy producers in the dairy supply chain and preparing the sector for a more market-oriented and sustainable future. For example, it gives Member States the possibility to make written contracts between farmers and processors compulsory in the milk sector, and it allows farmers to negotiate contract terms collectively within certain limits. The new regulation was published on 30 March 2012.

The package provides for written contracts between milk producers and processors and for the possibility to negotiate contract terms collectively via producer organizations. It also sets out new specific EU rules for inter-branch organizations, allowing actors in the dairy supply chain to dialogue and carry out certain activities. The package also entails a series of measures enhancing transparency in the market. A more detailed overview of the measures can be found below.

Regulations and information

The rules set by the Milk Package

Written contracts between milk producers and processors

Member States have the possibility to make written contracts between farmers and processors compulsory and to oblige milk purchasers to offer minimum contract durations to farmers. The contracts should be made in advance of delivery and contain specific elements such as the price, volume, duration, details concerning payment, collection and rules for force majeure. All these elements should be freely negotiated between the parties and farmers may refuse an offer of minimum duration in a contract. Deliveries by a farmer-member to its cooperative are exempted from this contract obligation if the statutes or rules of the cooperative contain provisions that have similar effects as the prescribed contract.

Possibility to negotiate contract terms collectively via producer organizations

Farmers can join together in producer organisations (PO) that can negotiate contracts terms collectively, including the price of raw milk. The volume of milk that a PO can negotiate is limited to 3.5% of the EU production and to 33% of the national production of the Member States involved. For Member States with a production of less than 500 000 tonnes, the limit is set at 45% of national production instead of 33%. This measure is designed to reinforce the bargaining power of milk producers. The limits allow negotiations between POs of approximately the same size as a major dairy processor while maintaining effective competition on the dairy market.

Regulation of supply of PDO/PGI cheeses

Member States are allowed, under certain conditions, to apply rules to regulate the supply of PDO/PGI cheeses upon request of a producer organisation (PO), an interbranch organisation (IBO) or a PDO/PGI group. This measure is aimed at ensuring the value added and quality of cheeses with a protected designation of origin (PDO) or protected geographical indications (PGI), which are particularly important for vulnerable rural regions.

Specific rules for inter-branch organisations

Specific EU rules for inter-branch organisations in the milk sector allow actors in the dairy supply chain to dialogue and to carry out a number of activities. These joint activities concern, among others, promotion, research, innovation and quality improvement, for a better knowledge and transparency of production and the market.

Increased transparency and better information

Finally, so that developments of the market can be closely followed after the milk quota regime expires, timely information on delivered volumes of milk will be provided.

The Commission proposal of December 2010

The High Level Group

The High Level Experts' Group on Milk (HLG) was created following the 2008/2010 dairy crisis with a view to looking at medium and long term measures for stabilising the market and producers' income and enhancing transparency. The HLG found important imbalances in the supply chain, an increasingly concentrated industry dealing with many and dispersed milk producers and an uneven distribution of the added-value. This situation has led to a lack of transparency, rigidities and problems of price transmission in the supply chain.

The proposed measures stem from the recommendations issued by the HLG and endorsed by the Council's Presidency conclusions of 27 September 2010.

High Level Experts' Group on Milk