Oliver Q
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Oliver Q in European Markets,

Why milk is cheaper than water in Europe

Europe is drowning in milk.

Russia has banned imports, Chinese demand is weakening and limits on production have been removed. The result: a huge glut of milk.

There is so much sloshing around the European Union that milk is often cheaper than bottled water. A liter bottle of water costs around $1.50 in the U.K.; a liter of milk $1.

In France, milk is also around $1 per liter, similar to the price of mineral water. And in German discount supermarkets such as Lidl and Aldi, a liter of milk can be as cheap as 55 cents, while a liter bottle of water costs around 72 cents.

The slump is a disaster for dairy farmers. Thousands protested in Brussels Monday, blocking streets with their tractors, and showering police with hay and eggs.

While the price of milk in shops has fallen by around 5% this year, wholesale milk prices have collapsed by about 20% to around 37 cents.

CNN Money