Dairy industry in Korea is facing an unprecedented difficulties following the settlement of free trade agreement (FTA) with U.S. and EU the two major dairy exporters. Dairy product already has become a necessity in Korea only preceded by rice. So maintenance of domestic milk production at a proper level is very important in the respect of food security. For this, renovation of dairy system is badly needed. However, the new dairy scheme suggested by government recently seems not successful in deriving consensus among interested parties. On the other hand, due to the characteristics of dairy farming, market intervention is very common in most countries. Korea also adopted quota system in 2002 to match milk supply with demand and it contributed no less to decreasing surplus over the past seven years. However, the quota system in Korea lacks equilibrium among dairy farms belonging different assemblers in terms of price, quota and bargaining power. This is why introduction of a new nation-wide quota system is inevitable. This study reviews some measures prerequisite for new dairy system including quota buyout.