EU farm chief refuses to budge on milk reforms

BRUSSELS – Europe’s farm chief on Monday rejected calls from France, Germany and eastern Europe to revise milk quota reforms agreed last year that opponents say will hit struggling dairy producers.

"I am not going to reopen the agreement … I’m not going to step back," European Agriculture Commissioner Mariann Fischer Boel told reporters at a meeting of EU farm ministers in Brussels.

"Let’s stop this purely political discussion," she said, adding: "It is actually dead this idea."

Last November, the 27 EU agriculture ministers agreed to lift milk production quotas by one percent per year before scrapping them altogether in 2014-2015.

Quotas were introduced in 1984 to support prices and tackle the then notorious butter mountains and milk lakes in Europe created by overproduction.

Earlier Monday, German Agriculture Minister Ilse Aigner argued that the milk sector’s predicament "has changed dramatically" since the EU decision to phase out the quota system.

"Due to the current situation in the market," Germany has proposed "a postponement" of the quota increases as part of a broader scheme to reform the bloc’s Common Agricultural Policy, she said.

Germany, along with Austria, Hungary, Slovakia and Slovenia issued a joint call for re-considering the increases in quotas, which would further reduce milk prices that have fallen by half over the last 18 months.

"In particular we need to re-examine the gradual increase in milk quotas and, if necessary, slow them down," they said in their statement.

The recent plunge in milk prices is part of a general decrease in food prices and has caused concern in major producers Germany and France as well as in eastern Europe.

French Agriculture Minister Michel Barnier called for a planned re-examination of the sector to take place "very early in 2010".

"If it was up to me we’d keep the milk quotas in some form or another," because "we have to be very careful not to exacerbate the current overproduction," he said on his arrival at the meeting.

Aigner said that even Germany’s largest milk companies could not live with prices down to just EUR 0.20 a litre, with anything under EUR 0.40 meaning a business loss.

Fischer Boel said the calls for a rethink were "sending totally wrong signals to the farmers" by giving them false hopes when they should be adapting to the new market place rather than seeking artificial price supports.

"The problem we are facing today is not the result of increased production in the EU but rather the combination of increased production in a number of third countries … and a decreasing demand in the EU and on the world market," she stressed.

She got swift support from the Czech EU presidency.

"There is not the slightest chance that the (EU) countries will accept a re-opening" of the quotas dossier, said Czech farm minister Petr Gandalovic. It would take a unanimous decision from the 27 EU members to revisit the issue and several nations including Denmark, Italy, the Netherlands and Spain are calling for higher quotas in order to open new markets to their producers.

The German milk producers federation BDM has not ruled out "milk strikes" following similar action last year.

There have also been protests in eastern EU nations. Earlier in March, some 8,000 Czech, German, Hungarian, Lithuanian and Slovakian farmers protested in Prague, while other actions took place in Bulgaria, Greece and Latvia.

AFP / Expatica