Slovak dairy farms face losses as raw milk prices fall below production costs

Purchase prices fall below farm costs

Slovakia’s dairy farmers say a steep fall in raw cow’s milk purchase prices is pushing farms into losses and could force some operators to abandon dairy herds. Hospodárske noviny reported that the average realized price was about €0.50 per liter last year, a level producers considered sufficient for normal operations. It averaged €0.40 during the first seven months of this year and has since fallen to roughly €0.36.

Miroslav Štefček, vice-chairman of the Slovak Agriculture and Food Chamber and chairman of the Ludrová agricultural cooperative, said producing a liter for less than €0.40 would amount to an “economic miracle.” Costs are even higher in the Liptov and Orava regions. His company has recorded a revenue shortfall of almost €300,000 when comparing average milk prices last year and this year.

Conditions are similar at the Kozárovce agricultural cooperative, which keeps approximately 300 dairy cows. Noviny.sk reported that the farm currently loses about €0.10 on every liter. Its purchase price has declined from €0.51 a year ago to €0.37-€0.38, according to cooperative chairman Peter Repiský. With annual output of 2.3 million liters, the business expects a revenue gap of €230,000-€250,000.

EU surplus increases pressure on smaller producers

The Slovak Agriculture and Food Chamber identifies substantial overproduction of raw cow’s milk in the European Union as a principal cause of the price decline. Slovak farmers say surpluses from other member states can enter their market without volume restrictions, intensifying competition in a relatively small producing country. Štefček said Slovakia has the EU’s third-lowest milk price, ahead only of Hungary and Lithuania.

Farmers estimate that aggregate losses in Slovakia’s dairy sector could reach €95 million in 2026, according to Noviny.sk. Drought is adding to the pressure by making it more difficult to secure enough feed. The combination of lower milk revenue and feed constraints is particularly damaging for farms that must continue funding labor, animal care and long-term herd development.

The price decline has not passed evenly through the supply chain. Farmers told Hospodárske noviny that cheaper raw milk has been reflected in UHT milk and butter but not to the same extent in products such as yogurt and cheese. Retail milk prices have nevertheless fallen sharply: Statistical Office data cited by Noviny.sk showed one liter of whole cow’s milk selling for €0.49 in June, compared with €0.63 in June 2024 and €0.76 one year later.

Herd closures could increase import dependence

Slovakia now has only about 100,000 dairy cows. Producers warn that further herd reductions could weaken national self-sufficiency in raw cow’s milk and leave the country more dependent on imports. Closing a dairy operation can have lasting consequences because productive herds, breeding programs and farm infrastructure take decades to build. Repiský said the Kozárovce herd reflects decades of breeding and investment rather than work that can be recreated within one or two years.

Agriculture Minister Richard Takáč said the government would press the European Commission to recognize the problem. Slovakia has raised coupled support for dairy cows to the permitted ceiling, while farmers and food producers are asking Brussels to activate the crisis reserve and provide funds to offset the losses. The immediate policy question is whether support can arrive before sustained negative margins persuade more farms to stop milk production.