IFA commends EU Commission’s approach to intervention stock sale

THE approach adopted by the European Commission on the first intervention stock sale since 2007 was described as cautious and welcome by the Irish Farmers Association.

Sat, 05 Jun, 2010 - 01:00

Ray Ryan, Agribusiness Correspondent

Dairy intervention stocks that have been sold back on to the European Union market were bought up by the Commission in the course of last year’s dairy crisis in order to support market prices.

A decision by the commission’s management committee has now resulted in 11,551 tonnes of butter being sold from stores in Belgium, Ireland, France, the Netherlands and Britain.

Further bids for 60,930 tonnes were rejected because the prices offered were considered to be too low relative to the current market situation.

All bids for 48,999 tonnes of skimmed milk powder were rejected because the offers were at prices below the current market average.

Agriculture commissioner Dacien Ciolos said the commission has seen the gradual recovery of the market in recent months.

It has now sent a strong signal it will manage the release of intervention stocks in a way that will not endanger that recovery.

The quantities available for the next tender are 13,669 tonnes of butter and 79,531 tonnes of skimmed milk powder.

June 15 is the deadline for bids, with the next adjudication at the June 17 management committee meeting.

During last year’s dairy crisis, the commission bought up 76,000 tonnes of butter and 257,000 tonnes of skimmed milk powder to help the market recover from low prices.

Some 51, 000 tonnes of butter and 65, 000 tonnes of skimmed milk powder have already been committed for sale under the separate Aid for the Needy scheme.

IFA president John Bryan said the commission’s cautious approach was vital to allow producer milk prices continue to recover.

It would also send a clear signal to the market that it will not sell intervention products at less than the market price.

The decision further shows the commission recognises the absolute need for producer prices to recover further, he said.