A pox outbreak, a grazing ban, and a feta supply base with nowhere else to go

Greece has ordered the slaughter of more than 488,000 sheep and goats since a sheep and goat pox outbreak began in 2024, with more than 2,600 farms losing their entire herds as of April, according to Business Insider ^[1][2]. The consequence is not a seasonal price spike but a structural cost increase in a product whose defining input cannot be bought anywhere else.

The mechanics are worth separating from the sympathy. Wherever the disease appears, Greek authorities require farmers to kill the whole herd, healthy animals included, because a single infected animal can doom hundreds ^[3]. The World Organization for Animal Health describes the viruses as highly contagious and deadly to sheep and goats, usually spreading through the air between animals in close contact and surviving in wool for two months, while milk from infected animals poses no risk to humans ^[4][5]. If the 488,000 figure and the 2,600 farms describe the same population, that is an average of roughly 188 animals destroyed per affected farm ^[6]. Alongside the culling, the government barred sheep from grazing freely outside, which converted a free input into a purchased one: farmers now buy commercial feed ^[7].

Compensation for feed and culled animals was promised, and farmers including Giannis Papastergiou, who lost his flock, told Business Insider they have waited a long time for payment ^[8][9]. Papastergiou said there are hundreds of thousands of euros' worth of feed stored on his farm with no answer from the government ^[10]. Farmers have protested the culling, the compensation delays, and the absence of vaccination ^[11]. Greece's Ministry of Rural Development and Food did not respond to Business Insider's requests for comment ^[12].

That absence is a deliberate trade calculation. Nine months into the outbreak the European Commission pressed Greece to start vaccinating, and the government declined, because under EU rules vaccination can trigger a temporary ban on dairy exports and 65% of Greek feta is sold abroad ^[13][14][15]. Business Insider notes studies finding that over the long term culling can cause greater economic damage than vaccination ^[16]. Athens chose to protect market access at the cost of the herd.

The herd is now the constraint. Greece's sheep population fell 17% between 2024 and 2025, yet the country still produced 154,000 tons of feta in 2025, worth roughly $1 billion ^[17][18]. Industry experts quoted by Business Insider expect the shortage to bite in 2026, with feta output about 11% lower and roughly 30,000 fewer tons of milk available for cheesemaking, about 20% less than the prior year ^[19][20]. An 11% shortfall against 2025 volumes is about 17,000 tons of feta not made ^[21]. Wholesale Greek feta passed $11 a kilogram by June, about 33% above the same period in 2025, implying a year-earlier level near $8.30 ^[22][23].

Because authentic Greek feta is traditionally made with sheep's milk, buyers cannot substitute their way out ^[24]. Alexandros Botos of Roussas Dairy, one of Greece's top five feta producers, said 20 of his supplier farms were forced to cull and could not be replaced one for one because the lost farms were large-scale operations; he took on more small suppliers and, as of April, was paying 10% more for milk ^[25][26]. In Athens, Katerina Katsouli, who has owned the restaurant Kriti since 1988, has had to find new suppliers after normally sourcing from Lesbos ^[27].

Watch three things: whether Greece reverses on vaccination and accepts the export risk, whether compensation actually lands before the 2026 milking season, and whether the 10% raw-milk premium at the factory gate holds or widens. The genetics are the slow item. The culled sheep had been bred over generations, and that work is gone ^[28].