Policy-change Triggered Environmental Uncertainty in a Dairy Cooperative: The Case of Mila in South Tyrol

Abstract

On April 1st 2015, the European Union lifted its quotas for dairy production, a system that has been in place since 1984. Prior to this, the region of South Tyrol in Northern Italy enjoyed protection from the constraints and penalties of overproduction. With the lifting of quotas in Europe, „Bergmilch Südtirol“, a dairy cooperative based in Bozen, Italy, faces significant challenges. The aim of this exploratory single case study is to gain a better understanding of how a dairy cooperative copes with uncertainty in the context of a new economic environment. The data collected included semi-structured interviews, observations, and a review of internal documents of the cooperatives. Results support claims of the cooperative’s resilience, despite new economic pressures. Recent Russian embargoes have also added to the challenges „Bergmilch Südtirol“ faces. Despite good governance practices and sound financial performance in recent years, „Bergmilch Südtirol“ may need to readjust its strategy, beginning with how the cooperative compensates its farmer-members for their milk.