Dairy quotas in Europe which were established in 1984 to regulate overproduction, are to be removed on March 31, 2015 and the European Commission reports it expects a smooth transition and a positive outlook for the European dairy sector because of significantly increased demand from world markets, especially Asia. Concern remain that there might be a deep price drop as production floods the market upon the quota removal. To avoid this situation, a European Milk Market Observatory has been established in April to track market fluctuations post-quota removal and to increase transparency in the industry. The Commission has also launched a ‘milk package’ giving member states the option to make written contracts between dairy producers and processors compulsory and giving farmers the right to negotiate milk prices through farmer organizations. Compulsory contracts have been adopted by Bulgaria, Croatia, Cyprus, France, Holland, Italy, Latvia, Lithuania, Portugal, Romania, Slovakia, and Spain.
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