The Minister for Agriculture Martin Heydon has been accused of “sitting on the fence” in relation to discussions in Brussels on milk supply contracts.

Proposals included as part of the EU’s Common Market Organisation (CMO) regulations have been the subject of unsuccessful trilogue negotiations in Brussels involving the Danish presidency and representatives of the EU Council, the European Commission and the European Parliament.

The Brussels talks have exposed differences around whether the new CMO rules would effectively trump existing milk supply contracts between co-ops and their shareholders by requiring specific terms and conditions.

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Other issues of contention include whether co-ops should get a temporary derogation or an exemption from the proposed CMO regulations.

ICOS has been lobbying in Brussels for an exemption from the CMO regulations, while producer groups have argued that co-ops should get a temporary derogation from the new rules at best.

Amendments

Asked by the Irish Farmers Journal to set out the Government’s position regarding the CMO amendments, Minister Heydon said he was “fully supportive of the proposal to strengthen the position of farmers in the food supply chain”.

However, he cautioned that the Commission needed to recognise “existing structures in member states, as per the previous iteration of the regulation”.

“We want to avoid any unnecessary administrative burden where existing structures are working well and to the benefit of farmers,” Minister Heydon insisted.

But James Doyle, chair of the Munster Dairy Producer Organisation, took issue with Minister Heydon’s statement.

“I am very disappointed that the Minister is sitting on the fence on this matter,” Doyle said.

“I call on the Minister to back the derogation proposal as it provides the best assurance for dairy farmers with regard to future milk supply contracts,” he added.

Doyle said he “fundamentally disagreed” with the Minister’s contention that the current system of milk supply contracts was working for farmers.

The present situation where farmers only know what price they will actually receive for milk “six weeks after the first delivery” was not acceptable, Doyle maintained.

Contract duration

ICOS has argued that the contract duration proposed in the CMO regulations is effectively six months.

This is too short a time “for either a farmer or a co-op to base investment decisions”, ICOS claimed.

The co-op body is also opposed to the proposal that milk pricing decisions would be taken away from elected farmer directors and be calculated instead with “reference to external indicators”.

Differences also emerged in the Brussels talks with regard to the CMO regulations around the pricing of livestock which are supplied to meat processors.

The next trilogue discussions on the CMO proposals will take place in the new year under the Cypriot presidency.