EMB says new crisis instrument is a first step

By Jim Cornall

- Last updated on GMT

Last week MEPs voted on the European Parliament’s position on common agriculture policy reform.
Last week MEPs voted on the European Parliament’s position on common agriculture policy reform.

Related tags EMB European union Dairy

European Milk Board (EMB) president Sieta van Keimpema said European dairy farmers are happy that the vote on the Common Market Organisation (CMO) in the European Parliament showed many MEPs are aware the EU agricultural sector needs effective crisis instruments.

The CMO defines among others the relationships between market stakeholders as well as measures to be taken in the event of crises.

Late last week, MEPs voted on the European Parliament’s position on the CAP (common agricultural policy) reform, which will be used as a basis for trilogues with the European Commission and the Council of the European Union due to begin shortly.

The new Article 219a (from amendment 149), which envisages voluntary production cuts during crises, is part of the CMO position.

“Coupled with the adoption of Article 219b (from amendment 150) that foresees possible production caps during the implementation of reduction programs, the CMO might soon have an instrument that could present an effective response to chronic crises,” ​EMB vice-president Kjartan Poulsen said.

At the same time, however, the EMB said it was disappointed compulsory production reduction (in amendment 277), which would be necessary to deal with far-reaching, long-lasting crises, was rejected.

“The very close vote on this amendment, nonetheless, confirms that a large number of MEPs are fully aware that the instrument of temporary compulsory volume reduction is also an urgent need,”​ van Keimpema said.

“We would like to thank these MEPs, who are clearly familiar with the dynamics of crises and the need for effective reactions.”

The EMB said its dairy farmers are also happy to see the adoption of Article 218b (amendment 147), which it is hoped will lead to the implementation of an early-warning mechanism in the CMO. In this context, however, the EMB has indicated a crisis situation still needs to be properly defined so appropriate instruments are activated in a timely fashion.

The EMB said the newly-inserted Article 172a (amendment 244) of the CMO takes on board value-sharing-clauses and a consideration of production costs. Even if it is not binding, the dairy organization said it shows these issues have gained the recognition they deserve among MEPs.

Dairy farmers are aware that market disturbances in the EU agricultural sector are a regular occurrence. With the establishment of a monitoring and management system for these disturbances (Article 222a from amendment 248), it will now be possible to deal with future crises in a more effective manner, the EMB acknowledged.

In terms of contractual relationships in the dairy sector (Article 148), the EMB said it was pleased the European Parliament reiterated the need for prices in contracts to be fixed on the basis of production costs. However, as it is still left up to Member States to decide whether they wish to make the use of contracts compulsory, the EMB said no significant improvements for the EU dairy sector as a whole can be expected in this regard.

The EMB also said it regretted the rejection of amendment 270, saying the proposed increase of EU milk pooling limits in Article 149 from 3.5% to 7.5% would have been an important positive development for producer organizations. It added the move would have allowed farmers to negotiate on an equal footing with processors, who are not subject to the low pooling limit that currently restricts producers.

The EMB noted dairy farmers are happy to see MEPs repeatedly mention the goal of sustainable income in their positions (amendment 3 for Recital 2 and amendment 47 for Article 1a); that imports cannot undermine EU standards (amendment 138 with respect to Article 188a) and that an observatory should be set up for the EU agricultural sector as a whole (amendment 146 for Article 218a).

“We call on the Council and the Commission to agree to these essential changes that shall be brought to the negotiating table by the European Parliament – the elected representatives of EU citizens. Fulfill your role as EU Institutions and bring about a real reform that will equip the EU agricultural sector in the CMO with appropriate crisis instruments,”​ van Keimpema said.

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