Brussels, 19/07/2013 (Agence Europe) - The European Commission has provoked France's wrath by deciding to scrap export aid for frozen chickens (see EUROPE 10891), of which France was virtually the only remaining beneficiary country, mainly through the Brittany-based groups Doux and Tilly Sabco.
The management committee of the EU carried out its regular update of the export refund rates, in light of the favourable market situation, and reduced to zero the refund rates for poultry meat, according to Roger Waite, the spokesperson to Dacian Ciolos, European Commissioner for Agriculture.
French Agriculture Minister Stéphane Le Foll immediately spoke out against a “sudden decision” which will “undermine the restructuring dynamic undertaken by the operators over the last several months”. The French poultry producers, who are struggling due, amongst other things, to increased production costs, were not expecting such a quick decision and thought they had a few months ahead of them.
France pointed out that the reform of the common agriculture policy (CAP) provides for changes in the conditions for the implementation of the refunds from the time it enters into force. For this reason, it argues, there is the option to keep the mechanism in place until the end of the year.
The refunds constitute export aid for whole frozen chickens for specific markets, particularly the CIS (Community of Independent States, the former USSR) and the Middle East.
93% of the money goes to France
Over the period July 2012-June 2013, the aid paid out stood at a total of €55.36 million for 264,754 tonnes, at a rate of €10.85 per 100 kilograms. 93% of this money went to France, which produced 94.67% of the exports in question. The level of the refunds had already been cut by two thirds.
The decision to scrap the aid “was based on the market situation and, in particular, the high prices observed on the internal market, and the foreseeable reduction in feed costs” for poultry, as well as “the positive and sustained trend of EU exports to third countries”, Ciolos' spokesperson explained.
The Commission had asked the states for a positive opinion in support its proposal, but failed to obtain the required majority due to a blocking minority formed around France. As a last resort, the Commission is authorised to decide on its own. The removal of the aid was supported by 13 member states against 10 countries which opposed it (France, Greece, Croatia, Cyprus, Hungary, Poland, Portugal, Romania, Slovenia and Slovakia), with five others abstaining (Italy, Spain, Latvia, Bulgaria and the Czech Republic).
The French agriculture minister has promised talks with the operators in question and the whole of the export sector in the very near future, in order to look at the immediate impact of the decision and to continue the adaptation work in order to find new prospects for the French poultry sector. (LC/transl.fl)