French farmers take part in a blockade on a motorway near Arzal, western France, on January 29, 2016, during a protest against the falling of prices of their products.

What do a referendum in Crimea, an economic downturn in China, a drought in New Zealand, and a policy change in Brussels, and farmer protests in France have to do with local cow herders in West Africa? 

Hint: it has something to do with globalization.

When European milk prices hit historic lows in 2015, French farmers took to the streets. They drove tractor brigades down local highways, exchanged sour words with politicians on TV, and intentionally spilled liters of milk on roads across the country. Waving signs that read “I am a farmer, I’m dying,” they used dramatic tactics to show that French farmers had no place to sell the milk they were producing.

A domino of events in far-flung countries laid the groundwork for their frustrations. Understanding how these events and policies were connected requires a trip around the world.

Global Events Drive French Milk Prices

First Stop: Russia, 2014

In March 2014, Russia annexed Crimea, a peninsula on the Black Sea that, prior to a highly controversial referendum, was part of Ukraine. The referendum’s result was overwhelmingly in favor of Crimea joining the Russian Federation, but the United States and the European Union disputed its legitimacy, expressing concern about what they viewed as a threat to Ukraine’s sovereignty. In response, they imposed sanctions on Russian individuals and businesses.

Russia followed suit, banning imported produce, including dairy products, from Australia, Canada, the European Union, Norway, and the United States.

This was a big change because until 2014, Russia had been a significant importer of European agricultural products, including French milk and cheese. As a result of the sanctions, Franco-Russian trade plummeted in 2015. Russia dropped from the fourth biggest market for French agricultural exports (excluding the rest of the EU and Switzerland) to the tenth.

Russia’s Imports From France

Layover: China, 2014–2015

The Chinese typically imported dairy products from New Zealand. But that changed in 2014 when the island country experienced a prolonged drought. As a result, Chinese consumption of French milk skyrocketed.

But in 2015, two things happened to change this longstanding trend: the Chinese realized they had overstocked on milk, and demand plummeted. Simultaneously, China endured an economic downturn. As a result, French dairy exports to China fell by over 13 percent. 

Connecting Flight: Brussels, 2015

Because the markets in Russia and China had contracted, French dairy farmers found themselves swimming in milk. They could not sell their excess supply domestically, as rates of milk consumption had dropped in France. Exacerbating the problem was a new European Union policy that allowed member countries to increase their milk production, a move that added to the growing supply and further drove down milk prices.

By the beginning of 2016, milk prices in France had plummeted nearly 20 percent.

The EU eventually stepped in with aid packages, offering 500 million euros, or about $585 million, in aid to dairy farmers. But the new quotas on milk production stayed in place. That meant European producers could make as much milk as they wanted. They began to compete for business in fast-growing markets in Asia and Africa. 

Touchdown: Africa, 2015-Present

Africa is an especially attractive market as the region boasts both the world's youngest and fastest-growing population - and, in the case of West Africa, some of the fastest-growing economies.

Between 2011 and 2016, milk powder exports from the EU to West Africa roughly tripled. Most of it went to plants in Senegal, Ivory Coast, Ghana, and Nigeria, which re-constitute the powder into liquid milk and sell it to neighboring countries. Arla, a Danish dairy company, saw nearly 16 percent growth in revenue in sub-Saharan Africa in 2016 (compared to 1.3 percent growth in its European operations). With supply still rampant in Europe, incentives are still clearly in place to exploit new markets.

Although African dairy farmers have never been able to produce enough milk to meet local demand, experts warn that the milk pouring in from EU farmers risks drowning the local dairy industry. 

In certain markets, the less distance dairy products travel, the better: "from local cows" and "farm-to-table" are popular selling points. But this story of milk is a journey that spans the globe - linking sanctions in Russia to demonstrations in rural France to milk powder plants in Nigeria - and its final destination is still yet to be determined.

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