OXFORD, England, Jan 7 (Reuters) - Irish farm minister Simon Coveney said on Tuesday farmers would need additional risk management tools in place before European Union milk quotas are lifted in 2015, including the creation of a futures market.
"There should be a market there that is available (to hedge risk when quotas are lifted)," he said on the sidelines of the Oxford Farming Conference.
The EU is scheduled to abolish milk quotas in April 2015 and Ireland, a low cost producer, has already begun to expand.
CME Group operates a dairy futures contract based on U.S. supplies while NYSE Liffe launched an EU skimmed milk powder contract in 2010 but trading has been sparse.
The major global benchmark for dairy prices is set at twice-weekly auctions launched in 2008 by the world's largest dairy exporter, New Zealand's Fonterra Co-Operative Group .
"At the moment, international trade in dairy markets is basically determined by New Zealand and we produce an awful lot more than they do," he said.
The European Union is the world's top dairy producer. (Reporting by Nigel Hunt, editing by David Evans)