Jul 29th, 2009

EU Commission's Report Will Do Nothing For Dairy Farmers - ICMSA

The EU Commission's Report "Dairy Market Situation 2009" confirms our worst fears. The EU Commission's prediction and possibly their hope that up to fifteen percent of dairy farmers will go out of business in 2009 will become a reality unless our Taoiseach and Minister for Agriculture, Fisheries and Food form new alliances immediately to force a policy change at EU level, according to Mr. John O'Leary, Deputy President and Chairperson of ICMSA's Dairy Committee.

This Report clearly shows that the EU Commission itself has absolutely no intention of introducing measures that will increase milk prices unless serious political pressure comes from the EU Council of Ministers for a radical change in policy direction that will return a reasonable milk price to farmers. It is quite clear, Mr. O'Leary said, that the EU Commission's intention is to support milk price at about 20 cents per litre and their solution to the current problem is to cut supply by attrition, that is by forcing dairy farmers out of business through low prices. Fifteen percent of dairy farmers in Ireland represents 3,000 jobs and families in rural areas, their demise will be reality unless our Government act immediately to protect these people's interests and not leave them to the mercy of the world dairy markets where Irish dairy farming simply cannot survive.

The peak months of 2009 have already passed with an absolutely terrible milk price that will not go close to covering their costs of production and will not meet the bills for the rest of this year. Compared to the average price in 2007, the income loss for a 250,000 litre milk producer in 2009 will be €32,250. Such losses are simply not sustainable.

ICMSA, Mr. O'Leary said, clearly set out its position to the Taoiseach at a recent meeting that long-term damage is now being done to the sector in particular for dairy farmers who have invested heavily to secure their future in the sector. The ultimate responsibility for this disastrous situation rests squarely with the EU Council of Ministers.

The EU Commission must be forced immediately to use the price supports available to it (intervention, export refunds and internal supports) to raise milk prices. In the long term, Mr. O'Leary said, that a total reversal of the CAP Health Check policy agreed in November 2008 is required. The policy agreed is disastrous for Ireland and farm families will simply not be able to survive under such a policy.

The French and German Governments have acknowledged this by seeking a change in direction in policy. Ireland had traditionally supported the French in agriculture negotiations and ICMSA believes that we should now realign ourselves again with French dairy policy and seek a policy based on supply management and price supports, concluded Mr. O'Leary.

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