Dáil Éireann Debate, Tuesday - 22 September 2015
493. Deputy Michael Healy-Rae asked the Minister for Agriculture, Food and the Marine if he will provide an update on efforts to stabilise milk prices in Europe, a review of the hands-off policy in place and a programme for farmers who are struggling to make a profit on dairy transactions; and if he will make a statement on the matter. [30712/15]
Amharc ar fhreagra508. Deputy Michael Healy-Rae asked the Minister for Agriculture, Food and the Marine if he will intervene in requesting the European Union Commissioner for Agriculture to secure a better price for dairy farmers here who are struggling for financial survival at present, as it is costing them more to produce their milk than what they are getting paid for it; and if he will make a statement on the matter. [31027/15]
Amharc ar fhreagraI propose to take Questions Nos. 493 and 508 together.
The price of milk and dairy commodities are determined by supply and demand factors both domestically and at international level. These include the Russian Ban and the softening of Chinese demand on one side, coupled with increased production among key global producers on the supply side. The longer term perspectives remain very positive.
Having witnessed dairy market developments affecting milk and dairy commodity prices in Ireland and the EU, I presented a six-point plan offering possible solutions to the Commissioner and my EU ministerial colleagues earlier this month. These were presented on the basis of my belief that they were appropriate for consideration by the Council and as a response to the market issues that had developed. This list was not exhaustive and I sought to reach common ground with other Ministers regarding a suite of appropriate solutions.
I am pleased to note that the final decision at Council on the aid package, including the 100% in the case of the PSA scheme for SMP, took account of significant elements in Ireland’s six point plan. I am satisfied that the improved PSA scheme for this product, which will include longer periods for storage as well as the improved aid rates, can help stabilise this market. Other key elements of the Commission Aid proposal include an advance of 70% for next year’s Single Farm Payment which will assist with cashflow difficulties. I also welcome the almost €14 million in direct aid for Ireland, a new PSA scheme for cheese and an increase in funding for the promotion of dairy products. In conjunction with stakeholders, I will now consider how best to utilise these funds to support Irish farmers.
I also made it clear that from my perspective, it will be necessary to give consideration at EU level to responses to volatility issues in the future such as more price transparency through the EU's Milk Market Observatory. I believe that further consideration needs to be given to the role that might be played by futures markets. The use of financial instruments specifically designed to take account of the cashflow impact of downward price cycles in commodity markets requires further examination also.
In addition to measures at EU level, I have also been proactive in other areas in terms of ensuring the right balance of measures are in place to ensure that Irish dairy farmers will remain confident for the future. Among the Government's initiatives in this area are provisions allowing dairy and other farmers to use income averaging over five years when it comes to paying income tax bills. This also offers respite to the sector from a cashflow perspective. Furthermore, I have also ensured that priority has been given to measures for the dairy sector in the Rural Development Plan. In addition, I have impressed upon the Irish banks the need to show flexibility in their dealings with farmers experiencing temporary cashflow difficulties in 2015.
Finally I decided to make a 3 year interest free instalment arrangement available to all those affected by superlevy this year. This option has been availed of by approximately 3,700 producers and will be of assistance to farmers facing cashflow difficulties arising from superlevy in the final year of the milk quota regime.
