EU agricultural markets are expected to remain robust in 2026 despite uncertainty and rising costs, according to the European Commission’s summer 2026 short-term outlook report.
The Commission said in a release on Monday that its assessment does not take into account ongoing heatwaves affecting farmers across Europe because the data used were collected before the current hot weather.
Uncertainty for the sector is linked to the repercussions of the conflict in the Middle East, weather-related risks, animal diseases and persistent trade tensions, it said. Rising input costs are putting pressure on producer margins.
Real GDP growth is forecast at 1.1% and inflation is expected to rise to 3.1%, driven by energy costs, according to the Commission. Food prices are also set to increase, it said.
The outlook also points to favourable crop conditions in the EU, with winter crop yields expected to be above the historical average.
Spring and summer crops may suffer from heat and water shortages, particularly in drought-prone regions.
Crops and livestock outlook
EU cereal production in 2026/27 is estimated at 273.7 million tonnes — a return to average levels after exceptionally high yields in the previous season, the Commission said.
Oilseeds production is expected to rise by 3.1%.
Production of protein crops is forecast to decline slightly but remain above average, while EU sugar production may fall because less land is expected to be used for sugar beet.
Olive oil production is expected to decline from the recovery seen in 2024/25 but remain above average in 2025/26.
EU milk supply is forecast to grow in 2026, driven by higher yields, the Commission said.
It expects increased raw milk availability to lift production of butter, cheese, whey and skimmed milk powder, while exports remain resilient despite weaker demand from the Middle East and trade disruptions.
Poultry production is set to grow on strong demand and high prices.
Beef production, by contrast, is forecast to decline in 2026 and 2027 due to a falling cow herd.
