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Proposed milk supply management measures a ‘step backwards’ - EDA

By Mark Astley , 29-Jan-2013

Proposed milk supply management measures a ‘step backwards’ - EDA

The proposed adoption of supply management measures represents a “real threat” to the growth of the European dairy sector, the European Dairy Association (EDA) has claimed.

European Parliament Agriculture Committee MEPs are making their final preparations ahead of a vote on proposed Common Agricultural Policy (CAP) reform amendments – including the adoption of supply management measures.

Under the measures, European dairy farmers would be compensated for reducing their milk supply for a fixed period in an effort to counter market problems.

Speaking with DairyReporter.com, EDA secretary general Dr Joop Kleibeuker said that implementing these measures would be a “step backwards.”

Undermine European dairy competitiveness

“The idea is that when the dairy market is not in a good way, dairy farmers will be encouraged to produce less milk,” said Kleibeuker.

“We think that implementing this type of measure is a real threat to the European dairy market. The European dairy market will not achieve optimal development if this measure is approved.”

According to Kleibeuker, producers and processors could find their income decrease as a result.

In this environment, dairy processors are less likely to expand manufacturing capabilities or invest in innovation. It would undermine the competitiveness of the European dairy sector, he added.

“At the moment, there is increasing consumer demand for dairy products - particularly from emerging markets such as China,” he said.

“The European dairy sector should be taking full advantage of this fact. But processors are less likely to invest in increasing their processing capabilities if this proposal is passed by the European parliament.”

‘Broadly supportive’ but concerned

The EDA has also voiced “concerns” about other measures that could dilute the operation of competition law, and potential alternations to the yet-to-be implemented Dairy Package.

Despite these concerns, the EDA is “broadly supportive” of the proposal on the CAP reform, which it believes reflect the “fundamental need for an effective safety net.”

In our view an adequate CAP Reform should be aimed at making European agriculture innovative, dynamic and sustainable economically, environmentally and socially. A successful and highly competitive EU agriculture will be beneficial for all parties involved. In this context we hope that the Parliament takes into account our concerns and are looking forward to continue a constructive debate on the CAP Reform with MEPs,” Kleibeuker concluded.