Guidance

How the Milk Quota Scheme works

The EU scheme sets an annual quota on the milk sales of each member state. Find out how this works in the UK.

This guidance was withdrawn on

The Milk Quota Scheme ended on 31 March 2015.

The Milk Quota Scheme sets the amount of milk that can be sold each year by a farm or holding. Anything over a certain amount will be subject to a fine or levy. The scheme covers all milk that leaves a holding, whether it is sold or given away free.

A quota year runs from 1 April to 31 March.

Types of quota

There are two types of quota:

  • wholesale quota: for the delivery of milk to an approved milk purchaser
  • direct sales quota: for the marketing of milk or milk products direct to the public

If you sell your milk wholesale only, you should apply for a wholesale quota and must sell your milk to an approved milk purchaser. If you supply milk both wholesale and direct to the public, you will need a separate quota for each type of transaction.

Registration of new milk producers

The Rural Payments Agency (RPA) administers the milk quotas scheme in the UK.

You must register with RPA if you hold milk quota or produce milk to deliver to a purchaser or market as direct sales. You will be issued with a Single Business Identifier (SBI), which will apply to your entire holding and must be used for most of your dealings with RPA.

If you are registered with RPA for the Single Payment Scheme (SPS), you will have separate SBIs for SPS and for milk quotas.

Trader registration number

You will also be issued with a trader registration number, which you should use when contacting the RPA.

Register with RPA

If you are a producer or quota holder, you will need to register with RPA and complete an application. You should contact RPA’s Customer Service Centre to apply on: 0345 603 7777.

Managing your quota

If you sell or market more than your allocated quota, you may have to pay a levy (called a ‘milk supplementary levy’) on the excess marketed if the UK as a whole is over its national quota.

However, the milk quotas system lets producers adjust their quota to match the amount they are producing by:

  • converting between wholesale and direct sales quota
  • increasing or decreasing by leasing or transferring quota

Milk quota, both wholesale and direct sales, can change hands when:

  • there is a change of occupation of the land to which it is attached
  • producers agree to transfer quota between them without land; quota that has been transferred without land becomes attached to the holding occupied by the transferee

Convert or transfer quota?

Subject to certain conditions, you may:

A lease of quota is an agreement between producers to make a temporary transfer of unused quota without land for the current quota year; use MQ3 Notification of temporary transfer (lease) of milk quota in 2014/2015 (PDF, 171KB, 5 pages)

Geographical restrictions on transfers and leasing

Transfer of quota is not allowed in:

  • Orkney (except for the island of Stronsay)
  • the islands of Jura, Gigha, Arran, Bute, Great Cumbrae and Little Cumbrae
  • the Kintyre peninsula south of Tarbert and part of the Cowal peninsula

You can only lease quota to other wholesale producers or direct sellers within the same area as you in:

  • Orkney (except for the island of Stronsay)
  • the islands of Jura, Gigha, Arran, Bute, Great Cumbrae and Little Cumbrae
  • the Kintyre peninsula south of Tarbert and part of the Cowal peninsula

Who can purchase your milk?

All wholesale quota holders must register their quota with one or more approved milk purchasers. You should check whether your contract allows you to use more than one purchaser or to change purchasers.

Approved purchasers

Your chosen purchaser must be approved by RPA to deliver milk. Check for an approved purchaser on the Approved Milk Purchasers List (PDF, 384KB, 19 pages) or call the RPA’s Milk Quotas Section on: 01392 315763.

You can decide which purchaser to use, if your chosen purchaser will accept you, and you may:

  • deliver to more than one purchaser
  • change purchasers during the quota year

Inspections by RPA

RPA must carry out a certain number of inspections each year to check that:

  • the details you have given are correct
  • you are meeting the current legal and administrative rules

RPA may inspect your premises (including land, crops and livestock) or check your records, or do both. It does not have to give you notice of a visit.

If you do not co-operate fully with the inspection, and you do not have good reason for this, RPA may take action such as restricting the movement of your livestock.

Published 31 March 2014
Last updated 5 March 2015 + show all updates
  1. Updated approved purchasers list for March 2015
  2. Approved Milk Purchasers list updated
  3. Updated list of approved milk purchasers published
  4. MQ1 form and guidance updated
  5. First published.