Brussels, 27/02/2015 (Agence Europe) - The end of the milk quota regime, at the end of March 2015, is both a “challenge” and an “opportunity” for the milk and dairy products sector, according to MEP James Nicholson (ECR, United Kingdom) in his draft report on The prospects for the EU dairy sector.
James Nicholson said that the implementation of the milk package of October 2012 (reinforced contractual relationships, increased powers of negotiation via producer and inter-professional organisations) has been “disappointing” so far. He also takes the view that the sector is currently experiencing a “crisis” - a term rejected by the European Commissioner, Phil Hogan - caused, amongst other things, by the Russian embargo. However, he states that when the quota regime comes to an end after 30 years on 31 March of this year, as decided upon in 2003, it will be both a “challenge” and an “opportunity”. He argues that this decision (to end milk quotas) “should be upheld, in order to prevent increased market instability”.
Revising the intervention price
Although the prospects are “positive” in the medium and long term, both on the single market and globally, volatility is a “permanent challenge” to the dairy sector, James Nicholson added. He believes that the Commission should “set in place a more reactive and realistic safety net and make the intervention price more effective”. This price should be “revised to take account of rising production costs”. The MEP referred to the support options (coupled payment, income stabilisation instrument). He also recommended the “possibility of using risk management tools such as futures markets to take advantage of the volatility in the sector and increase its competitiveness”. (Lionel Changeur)