Munich Milk Farmers Protest: A Deep Dive into the Dairy Crisis
Yesterday, January 28, 2026, Munich bore witness to a significant demonstration as approximately 200 dairy farmers, accompanied by 80 tractors, converged on Odeonsplatz and the Bavarian State Chancellery. Organized by the Federal Association of German Dairy Farmers (BDM) and Freie Bauern, the protest underscored a profound crisis within the dairy sector, driven by plummeting milk prices, escalating costs, and pervasive uncertainty. The farmers’ demands are clear: binding supply contracts under Article 148 of the EU market regulation and the activation of voluntary supply cuts as per Article 219. Their objective is to secure greater planning certainty and stabilize milk prices, a critical move for the survival of many farms.
The Unseen Price: Why Farmers Are in the Dark
A core grievance for many farmers is the opaque nature of milk pricing. Often, they deliver their milk without knowing the final price they will receive. Dairies frequently set payment prices weeks later, influenced by global market trends and sales opportunities. This system leaves farmers vulnerable to abrupt price collapses, especially during periods of overproduction, a situation the market is currently experiencing.
The BDM highlights the stark disparity: “With milk production costs averaging 53 cents per kilo, and even 62 cents in Southern Germany, producer prices range between 34 and 46 cents.” Some dairies are even contemplating prices below 30 cents. While this might translate to cheaper butter for consumers in the short term, it could necessitate state aid in the long run, signaling a potential systemic failure.
An Unprecedented Market Dynamic
Hans-Jürgen Seufferlein, an agricultural market expert from the Association of Milk Producers (VBM), describes the current situation as historic. “I have not witnessed such market dynamics and scale in 30 years of professional experience,” he told BR24. Milk deliveries in Germany are currently around six percent higher than last year, with global supply also increasing. Concurrently, butter prices are under pressure. Seufferlein anticipates a genuine turnaround no earlier than mid-year, indicating a prolonged period of instability.
Article 148: A Beacon of Hope or a Systemic Rupture?
Article 148 of the Common Market Organization (CMO) of the EU is proposed as a solution. It mandates written supply contracts between buyers and producers before milk collection, with clear rules on pricing, quantities, and duration. This aims to transform farmers from mere price-takers into predictable business partners.
However, this instrument is highly contentious. Bavaria’s Minister of Agriculture, Michaela Kaniber (CSU), maintains her opposition: “The EU would push our farmers into a centrally planned system with rigid contract specifications and burden them with new bureaucracy,” she informed BR24. “This path does not strengthen producers – it weakens them.” Federal Minister of Agriculture Alois Rainer (CSU) also rejects the regulation.
The German Raiffeisen Association (DRV) echoes similar concerns. “All scientific studies unanimously state: Article 148 does not lead to higher producer prices,” says Managing Director Jörg Migende, pointing to lower prices in countries like France or Spain. The Bavarian Farmers’ Association (BBV) also warns against poorer payment prices and refers to functioning cooperative structures. The Dairy Industry Association (MIV) is unequivocal: “It doesn’t work that you produce more and then demand that prices remain the same; that’s not a market economy.”
The BDM vehemently disagrees. “We expect Article 148 to provide above all more planning certainty. We would at least know for a certain period what price we would receive,” emphasizes the BDM.
Voluntary Supply Cuts: A Timely Intervention or Too Late?
In addition to Article 148, the demonstrators are calling for the activation of Article 219, which entails a voluntary supply cut with state premiums. Farmers would be compensated for temporarily reducing production to decrease supply and stabilize prices. Such a program was implemented in 2016/17.
Hans-Jürgen Seufferlein generally views this instrument positively but identifies structural weaknesses: “Little negative can be said against the voluntary supply cut – the problem is that it is almost always implemented too late.” Moreover, there are free-rider effects, as some farms might increase production while others collect premiums.
Minister Kaniber warns against state-controlled quantity management. Although there is currently too much milk on the market (around 6.7 percent more in Germany than last year), a state-funded supply cut is one of the sharpest EU instruments. “The state would pay for less milk to be produced – and that would be difficult to justify given the good years many farms have recently experienced,” says Kaniber. “A state-funded quantity reduction not only drives up producer prices but ultimately also affects retail prices. Food prices have already risen by around 30 percent in recent years.” This disproportionately burdens families with lower incomes, according to Bavaria’s Minister of Agriculture.
Bavarian Minister of Economic Affairs Hubert Aiwanger (FW) holds a completely different view. At the Munich demonstration, he stated: “We must now counteract to prevent a ruinous development for our dairy farmers.” Therefore, the milk quantity must be reduced.
The Lingering Aftermath of Quota Abolition
This debate is also a delayed consequence of the abolition of milk quotas in 2015. Since then, the market has fluctuated wildly between boom and crisis. Whether fixed prices or supply cuts will be implemented will be decided in the coming months. For many farms, it is a race against time – at least as long as milk prices continue to fall.
Source: https://www.br.de/nachrichten/bayern/milchpreis-unter-druck-warum-bauern-in-muenchen-protestieren,V9a9xwz
