October 18, 2016 9:00am by David Farrar

Getting paid not to milk

Europe is attempting to rein in milk production by its 52,000 dairy farmers with a scheme to pay them to not produce milk, and while the farmers have rushed to take it up, the success of the plan will not be known until early next year.

The 150 million euro carrot – more than $233 million – has been fully subscribed, with Agricultural Commissioner Phil Hogan predicting the move would lead to a fall in production after four years of continuous increase.

“I am confident that this measure, allied to others included in the July and earlier packages, will contribute further to an already stabilising market situation in the European dairy market,” Hogan said.

So the EU uses subsidies to pay farmers to do dairy and then further subsidies to pay them to not do dairy.

Wouldn’t it be simpler if they just left farmers to discover for themselves if dairy is profitable for them, as we do in NZ?