Dáil Éireann Debate, Wednesday - 3 February 2010
373 Deputy Seán Sherlock asked the Minister for Agriculture, Fisheries and Food the supports that are in place for farmers who are encountering decreases in the price paid for milk per litre; and if he will make a statement on the matter. [5650/10]
View answerDairy farmers incomes are comprised of the market price paid for milk and direct income support from the EU, including the dairy premium. The EU Common Agriculture Policy (CAP) provides a range of measures that can be used to assist the dairy market, and these were modified in the CAP reforms of 1999 and 2003. In the Health Check negotiations in 2008 there was pressure to remove or weaken the support measures significantly. At that time I fought hard to keep the key market instruments in place and these were used effectively to help support the market over the past year.
I have, together with my Ministerial colleagues, continually pressed the Commission to take all appropriate measures to deal with the dairy market situation, and those actions have helped to stabilise the market. Since March 2009 most of the available market supports were in place including export refunds, intervention, and private storage. In January 2009 export refunds were restored for dairy products and they were subsequently increased during the year. Prices on dairy markets have risen in recent months and there are signs of recovery and for that reason the Commission decided to reduce export refunds to zero in November 2009. I disagreed with that approach, as the market remains volatile and reducing refunds prematurely could delay a lasting recovery.
With regard to intervention for butter and skimmed milk powder it was decided last March to continue those schemes beyond the mandatory fixed limits. In July 2009 the Agriculture Council agreed to implement a special measure to extend intervention beyond August, to February 2010, and to 2011 if necessary. Commissioner Fischer Boel also gave a commitment in October to manage the release of stocks from intervention in a prudent manner. We are seeing some tentative signs of an improvement in dairy markets, though a solid recovery is still uncertain and it is crucial that the disposal of stocks from intervention is handled in a sensitive manner and in a way that does not undermine the market at this critical time. Furthermore, the 2009 private storage scheme for butter was introduced two months earlier than normal, and was also extended beyond August to February 2010.
At the November Council approval was given for some short term measures to be implemented to assist the dairy sector. The main change is the extension of the Commission's emergency powers to cover the dairy sector. Under this provision the Commission has made available an additional €300 million for the dairy sector in the 2010 budget. Ireland's share of this is €11.5 million and I have decided to allocate this on a flat rate basis to dairy farmers.
I will continue to maintain close contact with the EU Commission and the Council to ensure that support measures are activated at levels that will make a real impact in the market.
