Speaking at an event in Brussels, “The EU Dairy Sector: Challenges for the Future”, hosted by MEP Jim Nicholson, Mr Raymond said: “The EU dairy market has become more closely linked to the world market and more and more volatile. Therefore, in an increasingly competitive marketplace, it is crucial to have the right tools to in place to cope with extreme market volatility.
“Producers need to be able to better plan their businesses. We need to encourage the development of futures markets to take some volatility out of the market and to help farmers to hedge against risk. Other tools to help protect farmers against risk like insurance should also be looked at. Dairy cooperatives meanwhile play and will continue to play a vital role in helping farmers to better manage risk.
“In addition, the European Commission has to make public intervention more suitable in order to prevent a collapse of the dairy market. The milk intervention price must be updated to take account of rising production costs and market realities in times of severe market imbalances.”
Outlining additional measures, Mr Roquefeuil, Vice-Chairman of the Working Party, said “Producers need tools to improve and better their incomes. The EU milk package which aims to strengthen contractual relations between farmers and processors and improve farmers’ positioning should be fully implemented across the EU.
“All Member States have implemented or will implement in the near future minimum requirements for Producer Organisations according to the milk package in order to increase the bargaining power of milk producers. In almost half of them, contracts have been introduced on a mandatory basis, especially in countries where dairy cooperatives have a lower market share. Contracts are important and must deliver, especially with the phasing out of milk quotas and in times of severe market imbalances. In addition, a fair and responsible functioning of the dairy supply chain is needed. We also need to have more openness and transparency in the supply chain which can be achieved via the recently created EU milk market observatory which provides up to date market data.”