The NFU has called on European policy-makers to help make the dairy sector more market focused and to provide farmers with the right tools to supply a growing worldwide demand.
Board chairman Mansel Raymond made his comments in Brussels at a high-level sector conference attended by 400 representatives of EU institutions, industry, research and national governments.
Mr Raymond, also chairman of the dairy working group at EU farmers’ organisation Copa-Cogeca, focused on several key areas with the potential for a positive impact.
He said: “Given the CAP budget reductions, farmers need to obtain a realistic return from the market which covers their costs of production so that they can continue to develop their businesses.
“Quotas are going – this is right in a globalised market – but the EU has a number of other tools in its box.
“Priority should be given to the full implementation of the milk package. Contractual relations play a vital role in giving more predictability to milk producers as far as the volume, price and duration are concerned.
“For too long producers have had no choice but to sell milk below the cost of production. This is unacceptable. We need the EU to use whatever tools it can to help the market work properly so as to deliver a fair and sustainable price to milk producers.
“We need retailers to act more responsibly towards the milk producers, and to secure the long-term supply of milk for consumers across the EU. The increased role of producer organisations and the EU’s support in this area will also be essential.
“Market management tools such as public intervention and private storage are also of primary importance to help dairy producers cope with the effects of extreme market volatility.
“Important free trade talks are on-going between the EU and the US, Canada and other markets which could have important ramifications on our industry. The EU must defend our sector interests so that we can take advantage of new markets with our high quality products.”
Mr Raymond said more than 250,000 million European dairy farmers have left the industry since 2007.
“Low and volatile milk prices, environmental regulation and little potential to grow are the main reasons why milk producers are getting out of the industry,” he added.
“On the other hand the European dairy industry represents 13% of the turnover of the total food and drink industry in Europe. This shows the importance of the industry and why we must support it.”
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