Voluntary milk supply reduction scheme comes into effect

Commissioner for Agriculture Phil Hogan announced the implementation of both measures at the end of today's meeting of EU agriculture ministers in Brussels.

The last meeting of EU agriculture ministers, which took place on 14 March, saw a number of decisions made on market support measures, including an agreement to allow member states voluntarily reduce milk supplies under Article 222 of the CMO regulation.

This voluntary support scheme was one of the measures to be implemented today by the Commission, meaning recognised producer organisations, their associations, interbranch organisations and cooperatives in all 28 member states can now choose to produce less milk for a fee from national funds.

Outgoing Minister for Agriculture Simon Coveney has already indicated that Ireland will not be availing of the voluntary measure, saying the last thing farmers want after only a year without milk quotas is for the government to be paying them to produce less milk.

However, Commissioner Hogan has replied to this by saying it is not for the national government in member states to decide this but for the producer organisations and co-ops.

Even still, it does not look like processors in Ireland will be availing of the voluntary measure any time soon, with the new head of the Irish Dairy Industries Association (IDIA), Conor Mulvihill, telling the Irish Farmers Journal recently that there is unlikely to be any participation by dairy processors in Ireland in the scheme.

Flexibility around state aid rules

Hogan also announced today that legislation has been put in place that will allow the Commission to be flexible if member states want to draw on state aid money in order to pay farmers to produce less milk under this voluntary measure.

Doubling of the intervention ceiling

However, the doubling of the intervention ceiling for skimmed milk powder (SMP) from 109,000t to 200,000t has yet to take effect, according to Martijn van Dam, Minister for Agriculture of the Netherlands and chair of the Council. He said the Council still needs to adopt the modification to the fixing regulation that decides the intervention ceiling.

"We will try to do this as soon as possible," he said.

Another thorough debate on the market situation in the dairy and pig sectors will take place at the Council meeting in June, but in the meantime van Dam said the Commission is "doing its part in delivering upon the measures agreed upon last month".

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