EU agricultural markets are expected to remain robust in 2026, according to the summer 2026 edition of the short-term outlook report for EU agricultural markets, published today by the European Commission. To note, this report does not take into account the ongoing heatwaves which are severely affecting famers all across Europe, as the data used were collected prior to the ongoing heatwaves.
The sector continues to face significant uncertainty linked to the repercussions of the conflict in the Middle East, weather-related risks, animal diseases and persistent trade tensions. Rising input costs are putting pressure on producer margins. Real GDP growth is forecasted at 1.1%, inflation is expected to rise to 3.1% driven by energy costs, and food prices are set to increase. At the same time, the outlook points to favourable crop conditions in the EU, with winter crop yields expected above the historical average. However, spring and summer crops may suffer from heat and water shortages, particularly in drought-prone regions.
For arable and specialised crops, EU cereal production in 2026/27 is estimated to return to average at 273.7 million tonnes, after exceptionally high yields in the past season. Oilseeds production is expected to rise by 3.1%. Production of protein crops is forecasted to slightly decline but to remain above average, while EU sugar production may decline due to lower area under sugar beet production. Olive oil production is expected to decline from previous production recovery in 2024/25 but to remain above average in 2025/26.
In the case of animal products, EU milk supply is forecast to grow in 2026, driven by higher yields. Increased raw milk availability may boost butter, cheese, whey, and skimmed milk powder production, while exports stay resilient despite weaker Middle East demand and trade disruptions. Poultry production is set to grow, driven by strong demand and high prices. By contrast, beef production is forecasted to decline in 2026 and 2027 due to a declining cow herd.
EU balance sheets are available in the aqri-food data portal. More details are available online.
