Overall welfare effects are slightly positive for the EU-27. Whereas total agricultural income would decline due to lower milk prices on average, the EU dairy industry would benefit as prices of dairy products are expected to decline less than raw milk prices (. input costs decreasing more than revenues). Impacts on the FEOGA budget would arise mainly from additional export subsidies for butter and moderate losses of tariff revenues. If a full transmission of lower agricultural raw milk prices along the downward supply chain to consumers is assumed, the main beneficiaries of milk quota abolition would be consumers, who benefit.
