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The impact of the reform of the milk quota regime on the Italian dairy sector

Listed author(s):
  • Antimiani, Alessandro
  • Finizia, A.
  • Henke, Roberto
  • Manfredi, G.
  • Merciai, S.

This paper analyses the impact of the milk quota regime reform, actually under discussion, on the European countries with a detailed focus on the Italian milk and dairy sector. The dismantling of the milk quota regime is already on the EU agenda, but how and when to do it is still matter of debate. A possibility is to enlarge gradually the size of the national quotas, up to the full dismantling in 2015 (“soft landing”). Meanwhile, the discussion on Health Check of the CAP is under way. In this work we analyse the possible impacts of the reform of the milk quota regime on the basis of a Computable General Equilibrium (CGE) approach, using two models in sequence: the Global Trade Analysis Project (GTAP) model is used to evaluate the impacts of different scenarios of milk quota reform on the EU market and to compute the price changes outside Italy; these, in turn, are used as inputs for the MEG-D model, that focuses on the Italian milk and dairy market. The two models were run together with two specific objectives: the first was to avoid, in evaluating the impacts of reform of the milk sector regime in Italy, running the model with rough price estimates taken for secondary sources; the second, to have more specific results on the outcome at the national level. Particularly, the model takes in account the particular relevance of quality products (GDO) in Italian diary sector. In order to evaluate the impact of the “soft landing” reform scenario, we run a “comparison” scenario where the milk quotas are fully abolished in the 2009.

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Paper provided by European Association of Agricultural Economists in its series 2008 International Congress, August 26-29, 2008, Ghent, Belgium with number 43658.

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Date of creation: 2008
Handle: RePEc:ags:eaae08:43658
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  1. Binfield, Julian C.R. & Donnellan, Trevor & Hanrahan, Kevin F., 2008. "An Examination of Milk Quota expansion at EU member State Level with specific emphasis on Ireland," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6467, European Association of Agricultural Economists.
  2. Hertel, Thomas W & Martin, Will, 2001. "Second-Best Linkages and the Gains from Global Reform of Manufactures Trade," Review of International Economics, Wiley Blackwell, vol. 9(2), pages 215-232, May.
  3. Lehtonen, Heikki, 2008. "Impact Of Phasing Out Milk Quotas On Structure And Production Of Finnish Dairy Sector," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6465, European Association of Agricultural Economists.
  4. W. Jill Harrison & Mark Horridge & K.R. Pearson & Glyn Wittwer, 2004. "A Practical Method for Explicitly Modeling Quotas and Other Complementarities," Computational Economics, Springer;Society for Computational Economics, vol. 23(4), pages 325-341, June.
  5. C. F. Bach & S. E. Frandsen & H. G. Jensen, 2000. "Agricultural and Economy-Wide Effects of European Enlargement: Modelling the Common Agricultural Policy," Journal of Agricultural Economics, Wiley Blackwell, vol. 51(2), pages 162-180.
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