Author: Organisation for Economic Co-operation and Development

Publisher: Org. for Economic Cooperation & Development

Published: 2005

Total Pages: 180

ISBN-13:

Milk is one of the most supported agricultural commodities, and world dairy markets are characterised by a high degree of distortion. Although there is a strong case for dairy policy reform, a clear understanding of the dairy sector's specific characteristics and of policy measures' operational features is necessary for any reform process to be successful. This report is an attempt to improve such understanding through an analysis of the trade and economic effects of the main policy measures applied to the dairy sector. In particular, it examines the effects of both milk price support measures and milk quota systems. The removal of individual policy measures is modelled in order to assess the impact of international dairy trade liberalisation on production, consumption, trade, prices, income, and welfare. The primary focus of this report is the impact of policies and reform in the OECD area, although the consequences for other economies are also examined. In addition, this report offers economic insights into the workings of complex dairy policy measures and provides a discussion of the potential of the dairy sector -- globally and in individual countries -- as it adjusts to liberal trading conditions