EU Agriculture Commissioner Phil Hogan repeated his position that the EU’s dairy sector is “not in a state of crisis”.
Whilst he conceded that the Russian ban had a strong regional impact on dairy production, it “was not the main determining factor of recent price drops” on the EU market.
Latest Commission figures show that the EU internal price for butter remains relatively stable, while SMP and cheddar prices are up slightly. All dairy commodities are down on 2014, with butter, SMP and Whole Milk Powder a considerable -27%, -43% and -38% respectively.
Positively Commissioner Hogan did announce the extension of Private Storage Aid (PSA) for butter and Skimmed Milk Powder (SMP) until the end of September – it was originally due to close at the end of February.
Since PSA opened in September, just over 26,700 tonnes of butter and 17,900t of Skimmed Milk Powder have been taken off the market and put into private storage. This represents around 5% of EU butter production and 4% of EU SMP production. Most butter stocks are in the Netherlands (9,645t), Ireland (8,014t), Belgium (2,976t) and France (2,944t). The bulk of SMP is stored in Germany (9,420t), Spain (3,359t) and Lithuania (2,841t).
Public intervention for butter and SMP has also been open since Jan 1st 2015 although no product has been put forward yet.
In terms of what next, Commissioner Hogan is keen to examine how the Milk Market Observatory could be strengthened but called on member states to “provide price information on time so as to ensure that the quality of information available is accurate, up-to-date and useful”. A number of countries had missed deadlines for both November and December milk price notifications.
On superlevy payments six countries (including Ireland and Italy) called for the introduction of a scheme that would allow superlevy penalties to be paid in interest-free instalments by dairy producers over a number of years. Romania and Bulgaria called for something similar whose “main actors in the milk supply chain are facing serious problems and risk bankruptcy”. They called for a number of support measures including the reintroduction of PSA for cheese.