‘Changing intervention price is no quick fix for dairy sector’

It will take at least two years for the European Commission to secure changes to the current dairy intervention price structure, according to ICOS’ European Affairs representative Conor Mulvihill,

“And this is assuming that Phil Hogan would want to move on this issue in the first place,” he said.

“To make this work would entail the Commission securing agreement within a co-decision grounded process, involving both Europe’s farm ministers and members of the EU Parliament.

“The other key issue to be considered is that of funding any future increase in intervention prices. Under such circumstances the Commission would, almost certainly, take monies from the EU Crisis Fund.  In turn, this would trigger a 2.7% modulation of the Single Payment, which would impact on every farmer in Europe.”

But Mulvihill believes there are a number of short term measures which could be taken by Brussels to make intervention and aids to private storage (APS) more meaningful for Ireland’s dairy sector.

“There is nothing to stop the Commission committing to accept larger quantities of product for both intervention and APS’ purposes,” he said.

“I am also aware that many Irish dairy companies would like to see Brussels agreeing more flexible timing arrangements, where APS is concerned. The current minimum storage period of 90 days is widely regarded as being too long.”

Mulvihill said that the EU must look again at the use to which the estimated €850 million, collected by way of the 2014/15 milk super levy process, is put.

“At the present time, this money is put into a general fund with the EU. But this is dairy farmers’ money. And at a time of such challenging market conditions, Brussels must come up with creative ways of using this potential funding stream to meet the business needs of milk producers.

“For its part ICOS is proposing the introduction of a pan European TAMS style programme and the introduction of schemes to promote EU dairy products in other parts of the world.”

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