Commissioner Phil Hogan said on the sidelines of the informal meeting of agriculture ministers in Bratislava on Monday 12 September that the European Commission had done everything it could to try to resolve the crisis affecting a number of markets, in particular the milk market.
The Commission has brought forward 30 proposals and released €1 billion in support, Hogan pointed out. He noted that confidence seemed to be returning and hoped that this will translate into an improvement in the markets at the start of 2017.
French minister Stephane Le Foll noted on Tuesday, in a short meeting with the press, that the first call for offers to reduce milk production (total envelope for the EU of €150 million) will close on 21 September. Depending on the results, the Commission will adjust the purchase price (currently 1.4 cents per kilo of milk). “In any case, we will add 10 cents, with our decision to double our national allocation”, he said. Le Foll made the point that production “is beginning to stabilise and most of Europe’s producers, apart from Ireland, are likely to reduce production”. He stated, however, that it must be ensured that production does not begin to rise again at the end of the year.
Spanish minister Isabel Tejerina said that the dairy package had not had yet its desired effect in Spain. Milk prices have not risen, she stated. While European money and national top-ups were not having an effect on prices, they nonetheless were helping to stabilise farmers’ incomes, she said. She emphasised the importance of a new Spanish law forcing dairies to be transparent in their contracts with milk producers. “This has helped to stop dairies from paying unfairly low prices”, she said.
Portugal intends to use its allocation of the European €350 million aid package (€4 million) to help its milk producers: €45 per cow (for the first 20 head of cattle only), said the Portuguese minister Luis Capoulas Santos. He highlighted that almost all the country’s milk producers had reduced their production. Nationally, Portugal has cut milk production by 5%. He argued that the market turbulence could not be overcome with the tools currently available under the common agricultural policy (CAP). “I’m not asking for quotas to be brought back but mechanisms are needed to address the crisis.” The Commission must bring forward proposals on crisis management tools, he stated.
The Lithuanian delegation said that that country plans to match EU money with national funding to support milk producers (and also pig farmers).
Milk prices rise slightly. According to figures published by the European Commission on 9 September, the average farm gate price for milk in the EU, following the trend for dairy products on the global market, rose by 0.6% in August, the first increase in eight months. According to the latest report by the EU Milk Market Observatory, after its meeting on 6 September, the largest fall in milk production was in the United Kingdom. Production fell below the 2015 level in Germany, Belgium, Portugal and Italy. It has already been falling for some months in France, Spain and Portugal. Production still remains considerably higher than 2015 levels in the Netherlands and Denmark, while the increase is slowing in Ireland. Though milk collection rose by 3.3% in the first half of 2016, over the whole of the year the increase is expected to be between 1.4% and 0.9%, depending on how well the scheme for reducing production works. The Commission is predicting a 0.5% rise in production. (Original version in French by Lionel Changeur)