Brussels, 24/02/2016 (Agence Europe) - On Wednesday 24 February, the Farm Europe think-tank suggested that “With a €500 million enveloppe, between 2 and 2.5 million tonnes of milk could be withdrawn from the market” in an effort to balance the situation.
This tool would take the shape of European tenders for reducing production and putting an end to the interminable spiral that forces producers to produce more in an effort to generate liquidity.
These calls for tenders would involve the following: they would target farmers involved in this initiative with thousands of litres in volume in relation to the deliveries they made in the previous winter period; - the absence of quotas means that the initiative should be carried out by the producer organisations (PO) themselves and dairies that respond to the call for tenders and manage volume reduction plans within their respective collection scopes;-if a PO or dairy wins a call for tender it would indicate, if needs be, the names of the farmers committed to the reduction volumes. Farm Europe explained that this would help ensure that the money did indeed go to the farmers and was not simply absorbed by the dairies and that the farmers subsequently reduce their production and do not transfer their deliveries to another PO or dairy;- the Commission should immediately announce the global production reduction objective, indicate the overall amount and introduce incentives. The indicative amount would be around 20 centimes; - calls for tender should be made over a short period of time in an effort to obtain a subsequent market impact.
Farm Europe is of the opinion that the best performing farmers and those that want to leave their jobs would be the most active in the context of such an operation. This would help to allow the market to breathe and lead to a rise in milk prices, argues the think tank. It has estimated that milk reduction within this initiative would involve a volume of between 2 and 3 million t and would require a budget of €500 million.
Farm Europe also believes that the market measures taken last autumn should be upheld and reinforced, including private storage for milk products but with assistance based on more incentives. It also says that “A more sustained policy of promotion is necessary” on all markets but especially for those exporting milk powder and butter. An insurance fund for export credit would be an additional aid, such a tool already being available to Europe's competitors. (Original version in French by Lionel Changeur)