In the current market and policy context, tracking milk margins is important for policy makers and stakeholders. DG Agriculture and Rural Development has built a tool for the monitoring of milk production costs and margins based on indexes. Margin updates are available on the Milk Market Observatory website.
The milk margin monitoring tool is based on the Farm Accountancy Data Network (FADN) and compensates for the time-lag in data availability by using price-trend information from DG Agriculture and Rural Development and Eurostat. Depending on the availability of data, the tool provides estimates after the end of the reporting quarter (see methodology in Annex).
This brief presents estimates of EU milk production costs and margin indexes (2008=100) up to the second quarter of 2020. Developments in milk production costs per tonne are mainly driven by changes in the cost of purchased feed and energy. The seasonality of milk production also plays a role in quarterly trends: milk yield is higher after calving in the second quarter of the year, which results in lower production costs per tonne.
