Brussels, 28/07/2010 (Agence Europe) - The professionals stress that “the recent grain price volatility demonstrates that the market is not functioning properly and that there is a need to re-evaluate the way the market works in the future”, write COPA (Committee of Professional Agricultural Organisations) and COGECA (General Confederation of Agricultural Cooperatives) in a press release published on Tuesday 27 July.
These organisations noted an increase in grain prices, due to the heat-wave and commodity trading beyond the physical market. Paul Temple, president of COPA-COGECA's “Cereal Working Party”, says that grain prices “were so low in the 2009/10 marketing year that a rise should not create too much cause for concern. The extreme price volatility is nevertheless worrying and a problem for the commodities supply chain, so we need to ensure that the market functions better”.
COPA-COGECA expects grain production in the EU to be stable in the 2010/11 marketing year (1.3% less than the previous year's levels). In view of weather conditions, however, the situation could change. “The current volatility is also heightened by speculation. Cereals producers need a degree of market predictability to develop their business, ensuring production fits the growing need for food supply. The livestock sector especially needs a constant competitive supply. The remaining market management measures must consequently be kept in the EU cereals sector as a safety net”, states Temple. He calls on the European decision-makers to work towards a “strong” CAP (common agricultural policy) post-2013, to “ensure food security and respond to the increasing volatility on the market place”. (L.C./transl.fl)