Voluntary milk supply reduction scheme 'more smoke and mirrors'

Ulster Farmers’ Union president, Ian Marshall, has said he is encouraged by key parts of the European Commission plan to tackle the crisis on agricultural markets.

These include a boost for dairy intervention, additional private storage for pigmeat and a longer term focus on supporting exports and European Investment Bank funding for agriculture.

But he has described a voluntary milk supply reduction scheme as 'more smoke and mirrors' than a realistic policy to restore balance in European milk production.

“Along with other farm lobby organisations in Europe we had lobbied for action on intervention.

“The increase in the volumes of butter and skim milk powder that can be bought in by Brussels will ease some of the pressure – but like others we are disappointed the price hasn't been reviewed,” said Mr Marshall.

He added that the decision to look at ways to reopen private storage for pigmeat was a welcome commitment from the farm commissioner, Phil Hogan, but warned that both were about easing short term pressure rather than a much needed realignment of milk and pig output with demand.

Negotiating milk supply reductions

The UFU says it does not believe the short term scheme to allow cooperatives and farmers to negotiate milk supply reductions will prove effective.

“This did not command much support during the negotiations. It is voluntary – and that means reductions by some will be offset by others seeing this as an opportunity to increase production.

“More fundamentally there is no funding for compensation, unless it comes from member states, and that is a remote prospect in the UK,” said Mr Marshall.

He said however the action was at least a recognition that ways had to be found to better align milk production with demand.

“The Commission and ministers made clear there would be no return of milk quotas or other supply management controls.

We must find new ways to tackle volatility – and I welcome confirmation that the agri-markets taskforce brief will be extended to take that on board as a priority,” said the UFU president.

Meat market observatory a welcome addition

Mr Marshall said other things in the package were welcome, including the creation of a meat market observatory to improve transparency.

“It is now up to us as farm lobby organisations in Europe to make this as effective as possible,” he said.

The UFU has also welcomed progress on an export credit scheme and ways to get the European Investment Bank involved in long term funding of agriculture.

“These are long term goals and the challenge remains getting through the immediate cash flow crisis.

“To that end I am disappointed the Commission has not taken up the challenge to eliminate import duties that drive up fertiliser prices.

“Given the pressure farming is under across Europe, it is wrong to protect global business at the expense of farmers struggling to stay in business at all,” he said.