The proposal, supported by the European Parliament as part of the on-going CAP reform to maintain supply management in the dairy sector, requires the retention of the milk quota administrative framework, raising doubts about the EU commitment to the abolition of quotas in 2015.
This system would, in the event of a severe crisis in the dairy market, grant aid to farmers who voluntarily cut production by at least five per cent, compared with the same period the previous year, and would impose a levy on farmers who have increased their production.
NFU dairy board chairman Mansel Raymond said: “Dairy farmers work with the knowledge that controls on how much milk they produce will end in 2015. But there are some in Europe who would like the supply of milk within the EU to remain shackled through the back door.
“Dairy farmers face increasingly volatile market conditions and that’s why there is a need for the continuation of effective market safety nets within the CAP. But the existing tools, such as intervention, public storage and the direct payments made to dairy farmers are sufficient and we strongly support their continuation. However, there should be no place in a modern market-orientated CAP for supply management measures that penalise farmers for increasing their production.
“Take a young farmer coming into the industry who has the means to invest and can seize the opportunities posed by the growing global demand for dairy products. Under the plans from the Parliament, that same young farmer could face crippling penalties purely because they grew their business and increased production, but was unfortunate enough to do so just as the global market was taking a downturn. It’s not right that they would see the milk price fall and receive penalties on top, when at the same time, farmers who had decreased their production would be granted an incentive payment. That’s simply not the right way to ensuring a modern market-orientated dairy industry within the EU.
“Representatives of the European Parliament are negotiating the future CAP with the Agriculture Council and Commission through the trialogue process at the moment. I strongly urge those who are negotiating to reject these supply management proposals.”