An Examination of the Implications of Milk Quota Reform on the Viability and Productivity of Dairy Farming in Ireland

Abstract

The aim of the project was to produce quality, scientific based policy advice on the most efficient means for the transfer of milk quota between dairy farmers. The main objective of the project was to identify milk quota transfer mechanisms that would ensure the viability of the maximum number of farmers in Ireland while still supporting an internationally competitive agricultural sector. During the course of the project the Irish Department of Agriculture introduced a new milk quota transfer scheme. The milk quota exchange scheme was launched in November 2006. At this stage the objectives of the project were altered to be more policy relevant. Rather than exploring the efficiency of various milk quota transfer models, the aim of the project was redirected to explore the efficiency of the scheme as it was operated in Ireland. The rationale for this change was to provide relevant and timely feedback to policy makers on the operation of the new scheme. While the MTR agreement guaranteed the continuation of the EU milk quota regime until 2014/15, it also made provisions for a review of the milk quota system to be conducted in 2008. Clearly any changes to EU milk quota policy would have implications for farmers in Ireland. A second objective of this project was to explore some policy scenarios that may transpire from the milk quota review and to estimate the implications for farmers in Ireland.