Positions
Positions of the European Milk Board
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- Publication on cooperatives in the milk sector (5/2012)
- Comment on the milk package of the EU Commission (21/1/2011)
- Concept Monitoring body (21/1/2011)
- The European Milk Board’s Position Paper on the EU High Level Group Meeting on 2.2.2010
- Block exemption for milk producers from the European Competition Law (Draft)
- PROPOSAL FOR A BLOCK EXEMPTION REGULATION FOR MILK PRODUCERS
Documents of European Institutions
- EUROPEAN COURT OF AUDITORS: Special Report No 14: HAVE THE MANAGEMENT INSTRUMENTS APPLIED TO THE MARKET IN MILK AND MILK PRODUCTS ACHIEVED THEIR MAIN OBJECTIVES?
- EUROPEAN COURT OF AUDITORS: PRESS RELEASE: Have the management instruments applied to the market in milk and milk products achieved their main objectives?
- Report on fair revenues for farmers: A better functioning food supply chain in Europe.
- Communications from the Commision to the European Parliament, the Council, the European Economie and the committee of the Regions.
- Commission outlines blueprint for forward-looking Common Agricultural Policy after 2013
Studies and Data
- Evaluation of CAP Reform at Disaggregated Level, OECD Conference: Impact of decoupling and price variation on dairy farmers’ strategy. Overview of theoretical and real effects
- The Greens, European Free Alliance: Results of the Studies: The future of the dairy market: Less is more! & Demands for a sustainable dairy policy
“Future for Milk” must be a future for dairy farmers and consumers
Configuring the European milk market by respecting the milk producers’ and society’s interests
The core of a reformed political framework must be to secure milk production that is economically, ecologically and socially sustainable for 500 million European consumers. The configuration of the milk market should respect the principle of food sovereignty and with it the right of EU and of other countries to supply themselves with food. Another aim is to introduce stronger market orientation. This means that the focus of the EU’s future milk policy should be on creating basic conditions that enable the market to function in a healthy manner.
1. Balance of forces in the market – strengthening the milk producers
The current asymmetry in bargaining positions on the market to the detriment of the producers is due to their being given no opportunity (i.e. they are even deprived of this possibility by eroding the quota) to adjust their milk supply actively and flexibly to demand. As long as they are not given the chance to react together in a co-ordinated and effective way to plummeting prices by cutting production, they will never be in a position to bargain at all.
=> Strengthen independent dairy producer associations in the European antitrust law and actively support the regrouping of farmers through political measures.
2. Equilibrium of volumes – Balance of supply and demand
The aim of configuring the European milk market must be to gear milk production in Europe essentially to the internal market’s requirement and resolutely avoid surpluses. The world market is interesting for Europe only in the high-price segment. Produce should therefore only be exported to where high added value is possible. In this regard the milk producers are also backed by the development aid organisations that oppose the dumping of EU exports in southern hemisphere countries. This self-restriction, which makes economic and ecological sense, would then also
=> Secure appropriate protection from outside.
The EU Commission ought to set up a European milk market configuration agency to stipulate a milk volume that corresponds to society’s interest in sustainable supply of high-quality milk and guarantees cost-covering farm-gate prices. This can provide the framework for a balance of interests between milk producers and the dairy industry, prevent abuse and ensure that society’s interests are respected.
3. European milk market configuration agency
Every player in the milk market should be involved in this European milk market configuration agency (producers, processors, policy-makers, civil society). For this agency to function it needs statutes that clearly regulate the stipulation of the target price bracket based on production costs and enshrine the aims of configuring the milk market in society’s interest. The EU milk market configuration agency should perform these duties:
1.MONITORING market transparency
(prompt monitoring of production costs, milk prices, supply and demand)
2.MILK PRODUCER–DAIRY INDUSTRY contractual negotiations between market partners
Specifying a target price bracket based on the monitoring of production costs (Canadian model)
Stipulating the milk volumes to be produced, geared to the achieved price level and in line with market demand
3.CIVIL SOCIETY market at the service of society
Assessing the outcome of deliberations between milk producers and the dairy industry
The EU Commission is then given the key role of creating general applicability. It will ratify the decisions taken by the milk producers and the dairy industry while considering the statements made by representatives of civil society, and declare those decisions generally binding on every market player.
4. Adjusting volumes produced by means of producer associations
The most important task of the producer associations will be to implement adjustments to volumes as stipulated by the milk market configuration agency. The European producer association will then pass the necessity of reducing or increasing the milk volume on to the national producer associations. The European producer association must also be able to respond to unavoidable slight surpluses in supply by resorting to a strategic stockpile reserve to stabilise the market.
=> Continue with an individual-farm volume limit and general applicability of the decisions made by the milk market configuration agency and by the European producer organisation
Exports to non-European markets can still continue, provided producers are paid cost-covering farm-gate prices. The social importance of milk will be taken fully into consideration; individual interests of a few export-oriented companies must bow to this and will not determine the configuration of the entire sector. Presumably it will be necessary to divert to internal European milk markets, or not to produce, certain milk volumes currently being sold cheaply on the world market.
Positive consequences for every player in the milk market
In this scenario the politicians continue to play the supervisory role and can ensure that milk of high production and product quality will still be available in every European region. These are other advantages:
- Producers generate their income from the market, public funds are only required in disadvantaged regions and for special social achievements, payable through the 2nd pillar of the CAP.
- Market developments can be countered faster and more flexibly directly at the production stage, surpluses can be avoided
- A strategic reserve to stabilise the market will be coordinated by the producers, the taxpayer will no longer have to keep footing the bill
- Producers have greater responsibility and can act as equal partners in the market
- The dairy industry is ensured the volume and good quality of milk that it can sell at a fair price on the market
- Appropriate protection from outside in combination with the departure from systematic dumping prevents low-price imports of milk and dairy products and provides the basis for a sustainable development of European dairy production and self-sufficiency of Europe as well as the same in third states
Consumers can carry on buying fresh milk and dairy produce from the region at stable prices. Their interest in sustainable milk production throughout Europe under humane rearing and environmentally favourable conditions of production is taken directly into consideration by the milk market configuration agency and secured by cost-covering milk prices and quality guidelines.
Flexible market oriented supply management
for the lasting stability of sustainable milk production and the dairy industry throughout Europe
Preamble
A surfeit of supply: surpluses are preventing cost-covering prices paid to milk producers and destroying farms and regional structures
Since autumn 2008 the European milk market has been under considerable pressure from volumes, with milk supply manifestly exceeding demand. The flooding of the market with milk has resulted in all-time low milk prices. Milk producers are being paid between 18 and 24 cents a kilo, which approximates to half of production costs and therefore half the price required. This situation is almost wholly responsible for farms abandoning milk production and thus for the loss of regional supply structures to boot.
Promoting sales is not enough; production volume has to be reduced
The EU Commission has been trying to stabilise the market since early 2009 by re-introducing export refunds and storing vast quantities of butter and MMP (incl. private storage this totals some 450,000 tons). Although these measures have already cost hundreds of millions of Euros, they have not prevented the slump in the milk price referred to above. It is not enough to be active on the sales level. The production volume has to be reduced.
Joint responsibility of politicians and milk producers
Politicians and producers have a joint responsibility for a sustainable milk production throughout Europe. This is a social issue, with the values at stake being such as security of supply, food quality, sustainability, food sovereignty, and the vitality of the countryside.
By taking the measures outlined below the politicians can create the requisite basic conditions for cost-covering milk producer prices in a favourable and sustainable way, enabling farms to survive.
I) The following basic conditions are required for producers to have more clout in the market and for cost-covering milk-producer prices to be achieved:
1. Monitoring agency
To analyse and estimate supply and demand a European monitoring agency has to be set up in which all the players in the milk market are represented: milk producers (EMB), the dairy industry, consumer organisations and politicians. This agency will find out the costs of producing milk, on a regular basis. The corresponding cost-covering producer price will be the yardstick for stipulating the volume of milk and the monitoring agency’s use of various instruments.
2. Producer-financed levy
A legal basis must be created to allow the introduction of a producer levy to which every milk producer in the EU is subject. This levy is to be used to finance a demand-led control of volumes, i.e. to increase or decrease the volume depending on the development of demand.
3. Universal applicability
To enable market-shaping instruments to have teeth, what is called for is an EU-wide limit on volumes enshrined in law based on reference volumes for individual farms.
4. Unifying milk producers
Finally, a legal basis has to be created that allows milk producers to unite on the member states’ level and above and beyond that in producer co-operatives.
II) Measures to be taken in the short term to raise prices paid to milk producers
Given the crisis in the market a step-by-step plan has to ensure that the milk price is raised to a cost-covering level; this requires the politicians reducing the volume of milk to enable the dairies to pay cost-covering milk prices as quickly as possible.
By 1.10.09: 30 cents, by 1.11.09: 33 cents, by 1.12.09: 37 cents, by 1.1.2010: 40 cents
This calls for the following measures:
- The effective restriction of national netting options
- Freezing the 1% rise in quotas by 1.4.2009
- A pan-European invitation to participate in a voluntary, time-limited reduction in volumes.
The monies from the super-levy paid by the producers and the funds from the export subsidy and the intervention can be used for Measure 3. These will thus be used to impact on the market and will be of direct benefit to the dairy farms.
Corresponding laws or regulations have to be passed in such a way that they can come into effect in good time.
Positions
Demands on politics
System change -for the lasting stability of sustainable milk production and the dairy industry throughout Europe
Preamble
A surfeit of supply: surpluses are preventing cost-covering prices paid to milk producers and destroying farms and regional structures
Since autumn 2008 the European milk market has been under...
DECLARATION of the international congress of non-governmental agricultural organizations of new EU member states
DECLARATION
of the international congress of non-governmental agricultural organizations of new EU member states
taking place from June 1 to 2 2009 in Brno.
We call for the equality of farmers in the European Union
and ensuring the competitiveness of milk producers
Generally, due to the “double-tracked” Common...
