IN THE wonderfully politically incorrect Fawlty Towers, when entertaining German guests Basil was at pains 'not to mention the war'. Inevitably the incident-prone hotel keeper failed, making for a classic episode.

When it comes to the European Commission, the same sentiment could be applied to dairy products. It is best not to mention the massive stock of milk powder the Commission has in store. An already difficult problem is getting worse because global dairy markets are softening, meaning Brussels missed the chance to sell these stocks when markets were buoyant.

The stockpile is reminiscent of the bad old days of the CAP, when we had milk lakes and beef mountains. This led to the Ray MacSharry driven reforms of the early 1990s, but intervention support remained in place for dairy products.

What we have now is a hangover from the dairy collapse in 2015, when the Commission was forced to use intervention to buy up stocks of milk powder. The theory of intervention has always been that stocks move back onto the market when prices improve. This was the case with butter and pigmeat in private storage. But as with any problem that gets too big, it then becomes more difficult to solve – and 380,000 tonnes plus of milk powder is a big stock and a big problem.

The EU farm commissioner, Phil Hogan, whose advisers in Brussels include one with an Irish dairy industry background, is well aware of the scale of this problem. He has warned farm ministers they cannot continue ignoring this. He went further, making clear that the EU is in danger of a milk over-supply problem this year if production cannot be controlled and stocks brought back into balance.

France has suggested using some of the stocks in animal feed or for 'deprived' people – but the problem with all these solutions is they create displacement in the market. Product sold cheaply or given away undermines the current market.

It was a fear of this happening that saw the Commission turn down almost all tenders for the milk powder stocks last year. All the offers were below market prices, and the Commission feared releasing stocks would damage what was then a buoyant market, with record milk prices. Instead it kicked for touch, meaning that the boom days have passed with the problem stocks still there.

This prompted a gloomy warning from Hogan that member states would need to be more responsible with their milk output. He believes the market is at risk, and he has branded what is happening in some countries, in terms of increased production, as unsustainable. Those he has criticised include Ireland and the UK, but there are also concerns about France and Germany.

Dairy farmers are well aware that markets are cyclical, and by any standards 2017 was a good year – hence the global increase in production. It saw the highest ever milk price achieved in the EU, but the good days in the dairy cycle seem to be getting shorter and the troughs longer and deeper. The awful slump of 2015 is still fresh in farmers' minds, and while we are not yet back to those levels of unsustainable production, the clear message from Brussels is that things are not looking as good. There is likely to be rigid control of intervention if dairy prices weaken to that point. Politically and commercially, the Commission cannot add to an existing problem of excessive milk powder stocks.

The problem is that no-one is coming up with any realistic solutions to reduce the stockpile. In retrospect the Commission would have been better to bite on the bullet and dispose of these stocks when prices were good in 2017. That might have hastened the softening of the market, but that was always going to happen.

Now it is in an even bigger mess with this 380,000 tonne millstone around its neck. Those stocks are going to overhang the market this year. They will accelerate the inevitable drop in prices, as European and global buyers take advantage of an excess of European milk powder chasing static demand.

For now this is more of a yellow or amber warning than a looming disaster, but dairy farmers need to be realistic about prices in the months ahead. The boom days of 2017 are slipping away and there is no longer any justification for a free-for-all production increase in the belief that growing markets can absorb this.