An economic analysis published this week shows the serious impact of the European Union’s Skim Milk Powder Intervention Program on U.S. dairy. 

The program hit U.S. farm-gate milk prices especially hard during 2016-2019. 

The report says the U.S. was economically harmed in three ways. 

First, the EU program depressed the global price of skim milk powder, lowering U.S. milk prices, and contributing to a $2.2 billion loss in 2018 and 2019. 

The program also inflated the EU market share, resulting in a drastically smaller export market share for U.S. dairy exporters, which led to export losses totaling $168 million in 2018-2019. 

Finally, the analysis says when the EU unleashed its stockpile of skim milk powder into the global marketplace, the disposal affected U.S. competitiveness in historically important export markets like Southeast Asia. 

The International Dairy Foods Association, the National Milk Producers Federation, and the U.S. Dairy Export Council sent a letter to U.S. Trade Representative Robert Lighthizer and Ag Secretary Sonny Perdue, pointing to the analysis as proof the EU’s SMP Intervention Program has wreaked havoc on the U.S. dairy industry. 

They’re asking the government to help prevent the EU from using future intervention practices to dispose of dairy products into the global market at discounted prices.

Story Courtesy of the NAFB News Service