Despite the Russian market falling away and price drops, Estonian dairy producers could face a three-million-euro fine from the European Union for exceeding quotas.
Agriculture Minister Ivari Padar said the final production numbers from 2014 will be in in April, and the fine could be around three million euros. That figure would have been larger were it not for the cuts following the Russian food import ban. Padar said the fine could have been as high as 13 million euros.
The EU's annual dairy quota system is due to be disbanded on April 1, but that does not save Estonian farmers from fines for last year.
Many EU nations are planning to substantially increase dairy production, while Estonia cut dairy herd numbers by as much as 9 percent this year.
“I am hoping that during the second half of the year we will be able to pay a rate for milk which would cover production costs. But 2015 will be a cautious one as people who are smarter than me are unable to forecast what will happen once the market opens,” Padar said.
Editor: J.M. Laats