The reform of the CAP in milk and milk products was introduced in 2004. As butter and dry skimmed milk intervention prices decrease the farmer price of milk will also decrease. After 2007 they could vary between 7.30 and 7.60 Czech crowns per kg milk (i.e. by 0.60 and 0.90 crowns.kg-1, respectively, less than in January and February 2005). The milk direct payments (premium and supplementary ones) will compensate the shortening of the milk revenues. So the Czech milk producers have to improve their economic results to compete with the EU and world markets.