CAP reforms opposed by dairy associations

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Related tags: Dairy

The National Farmers Union (NFU), the Dairy Industry Association
(DIAL) and the Federation of Milk Groups (FMG) have released a
joint statement indicating their views to the Department for
Environment, Food and Rural Affairs (DEFRA).

The three organisations claim to represent the majority of the UK's dairy producers, co-operatives and processors and they have expressed the industry's support for the calculation of direct payments to dairy producers according to an individual processor's quota holding.

The organisations claim that the current system of payments would reduce the total amount of support available and in turn put certain types of producers at a competitive disadvantage.They want producers to receive maximum support when it comes to restructuring of their businesses in order to respond to the reductions in support prices required by CAP reform.

The organisations have called for dairy payments to be decoupled in 2005. They say that if the payments are in accordance with individual producer's quota holding this will allow the producers and processors greater flexibility in planning for the future and to help the restructuring of the industry.

The triumvirate of dairy producers have objected to DEFRA's plans to reduce direct payments through the use of the national envelope and believe that dairy producers need to receive the maximum possible level of benefits available through direct payments that they were entitled to. The national envelope is a fund that nations set aside for various industries. The associations claim that this would allow producers to have the best opportunity to address the issues of economic sustainability of dairy production raised by the reform of the CAP.

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