Dairy production, standards and competitiveness in global markets

Case Study 13: Dairy production, standards and competitiveness in global markets

What is the relative weight of labour costs in total milk production costs at farm level in the selected 9 countries?
What national legislation and implementation rules affect farm competitiveness, in relation to labour?
How does labour and environmental issues affect international trade and competitiveness in dairy commodities?
What is the relationship between competitiveness, labour and environment in the dairy sector and how they are related to SGDs?

Animal production and in particular dairy production, is an intensive labour activity if compared to other agricultural sectors. Labour conditions and related costs may significantly affect dairy products competitiveness and international dairy trade. In this case study, the differences between labour conditions, legislation and local rules were investigated. Particular attention was paid to labour condition and environmental impact in each of the nine countries. The case study is directly related to SDG1 ‘No poverty’, SDG2 ‘Zero Hunger’ and SDG3 ‘Good Health and Well-being’, SDG13 ‘Climate Action’ and SDG15 ‘Life on Land’.

The alignment of this Case Study with the SDGs provides a comprehensive framework for assessing the impact of labour conditions, environmental sustainability, and trade dynamics in dairy industry. The above SDGs influence various aspects of dairy production, from labour rights and working conditions to environmental sustainability and economic growth. By adhering to these goals, the studied countries can enhance their competitiveness, meet EU standards, and contribute to global sustainable development. Integrating these SDGs into national policies and practices improves trade relations with the EU and ensures the dairy industry’s long-term sustainability and ethical integrity.

A combination of domestic laws, EU policies, and international agreements influences the legal framework within which dairy production operates. These regulations significantly impact dairy products’ competitiveness, sustainability, and trade dynamics. Addressing gaps in intellectual property rights, consumer protection, and corporate governance could enhance understanding of the legal landscape affecting the dairy industry. Finally, the study highlights the complexity of international trade and the need for compliance with a range of legal and regulatory standards to ensure competitive and sustainable dairy production.

Labour cost and GHG emissions can significantly, and increasingly, affect the competitiveness of dairy value chains and have a great influence on dairy products competition in the global market. In this case study labour costs and CO2 emissions have been quantified in each of the nine countries at farm level and, based on this, a comparison across countries was carried out.

Due to the lack of a worldwide farm accountancy system, the methodological approach chosen to achieve the goals of this case study is the Typical Farm Method. A typical farm is a model farm representing the most common farm type for a specific product in a specific country or region. The environmental component focused on the quantities of emissions related to dairy production was also calculated by using the typical farm model. The social impact analysis was based on the research of working conditions in the case study countries. In addition a conversion was made to move from the known SDGs to the more operational disclosures of the GRI system. In order to create links between sustainability elements investigated related to dairy trade products, causal loop diagrams (CLDs) were made to complete the methodology tools used.

Primary data collection were performed by local experts according to the Typical Farm approach. Secondary information regarding the national legislation have been collected through a literature review and country specific official sources.

Thanks to the methodology applied in this case study, it was possible to visualise how the different components of a dairy system actually interact with each other and how changes in one of them can influence other elements. It shows that the complexity of the dairy sector can be summarised by using a Causal Loop Diagram where the information and data sourced from literature and specific studies can help in describing the cause effect in SDGs identified in this study can be summarized by different scenarios.