Brussels, 31/05/2010 (Agence Europe) - The High-Level Expert Group on Milk (HLG), set up on 5 October 2009 in the midst of the milk crisis to help boost the power of dairy farmers, is coming to an end. The HLG will meet for the last time on 15 June to put the final touches to the experts' recommendations, which will be used by the European Commission in preparing and unveiling new legislation at the end of the year.
The HLG's draft conclusions document makes recommendations in several areas: Recommendations on contracts between dairy farmers and dairies in order to ensure a better balance of supply and demand. The High-Level Group on Milk invites the Commission to issue guidelines or draft legislation to promote the use of formal written contracts, written in advance, by dairy farmers for the supply of raw milk. The HLG says the contracts should cover price; the amount of milk that can or must be delivered; the timing of the deliveries during the season and the duration of the contract. All the specific elements of the contract should be freely negotiated between the parties.
Potential measures for increasing dairy farmers' negotiating powers. In order to boost dairy farmers' negotiating powers relative to other industry players, the HLG urges the Commission to consider draft legislation to enable farmers to negotiate the terms of their contract, including pricing, with some or all members of a dairy.
Inter-professional organisations. The HLG recommends that the Commission examine the option of the inter-professional relations measures for the horticultural industry being applied to the dairy industry.
Transparency and consumer information. The Commission is urged to elaborate on the European Food Price Monitoring Tool.
Market measures. The HLG generally regards the existing safety net (Ed: intervention for butter and skimmed milk powder, private storage of butter and export subsidies) as “appropriate and sufficient”. Nonetheless, the HLG invites the Commission to explore new WTO green box-compatible (Ed: aid that does not distort competition) instruments in the framework of the CAP (Ed: common agricultural policy) after 2013, in order to reduce income volatility.
The experts invite the Commission to consider facilitating the use of futures markets, in particular via targetted training programmes. The draft HLG report argues that futures markets can be used to “manage the risk of price extremes”. The HLG's discussions showed that a clear majority of member states want intervention systems to continue as a safety net but not as a permanent outlet.
Origin labelling and marketing standards. The HLG invites the Commission to ensure that dairy substitutes and non-dairy products (vegan alternatives to cheese, for example) are clearly labelled and are not given names that might confuse them with proper dairy products. The experts' discussions showed large support for voluntary labelling of the farm from where the dairy ingredients originated.
Innovation and research. The Commission is invited to improve the communication on the current possibilities for innovation and research within the existing framework of rural development and research framework programmes.
EU member states' farm ministers will discuss the HLG's recommendations at their meeting in July, in order to help the European Commission in its drawing up of draft legislation.
The High-Level Expert Group on Milk was set up to examine possible dairy industry measures for the medium and long-term ahead of the expiry of milk quotas in 1 April 2015. It is chaired by Jean-Luc Demarty, Director General of the Directorate-General for Agriculture and Rural Development at the European Commission, and is made up of member states' representatives. The HLG generally meets once a month. (L.C./transl.fl)