French dairy industry warns of potential agri-food crisis

The French dairy industry is facing significant instability due to environmental, economic, and regulatory pressures. The private dairy industry association, FNIL, has warned that the current agricultural crisis caused by summer droughts must not evolve into a broader agri-food crisis. Drought conditions have reduced milk production and quality, while water access issues have disrupted factory operations.

FNIL has called for industrial modernization through digitalization, AI, and energy efficiency, alongside measures to strengthen resilience against climate shocks. The association also criticized current French regulations and low pricing policies that they claim devalue the sector.

Simultaneously, tensions are rising during price negotiations between farmers and major industrial players such as Lactalis, Danone, and Savencia. While 2025 saw a slight recovery in producer prices, the industry faces threats from potential milk overproduction and falling butter prices. Farmers also face concerns regarding fodder shortages heading into winter and the impact of retail promotions that drive milk prices below one euro, a practice producers find unsustainable.