Dairy farmers warned to maintain close control over production levels

REFORM of the Common Agricultural Policy (CAP) will not happen before the first half of 2013 when Ireland takes up the EU Agriculture Presidency, according to Simon Coveney, Minister for Agriculture, Food and the Marine.

In the interim, Mr Coveney warned dairy farmers attending yesterday’s National Dairy Council (NDC) conference in Dublin to keep a close control on their production levels. Failure to do so, he warned, would lead to a superlevy fine which would very likely drive new entrant farmers out of business.

“We are putting together a coalition with countries like Netherlands and Denmark. We are trying to convince Germany and France to accept some greater flexibility in regard to butterfat levels, perhaps another 1% flexibility.

“We are trying to create conditions which will allow young farmers to upgrade for the new post-quota era in 2015,” Mr Coveney said.

“Our dairy sector has been stagnant since the quota era was introduced in 1984. As a union, the EU was actually 7% under quota last year. Slovenia was 17% under quota. Ireland, the Netherlands and Denmark want greater production flexibility, but some other countries are refusing our requests and it seems to be about controlling the price.

“I don’t accept that as a valid explanation, because Ireland wants to produce the extra milk for the China infant formula market.”

Largely driven by the Danone plant in Cork, Ireland produces 35,000 tons of baby formula every year. That will grow to 100,000 tons and Ireland will produce a fifth of all global consumption of infant formula.

The minister also noted that the current economic situation has highlighted the importance of the agri-food sector as a key driver of an export-led national recovery, with the dairy sector forming a key component.

“The dairy sector stands at a time of great challenges and of great opportunities, captured succinctly in the conference title. Promoting sustainable dairy growth is really what it’s all about right now,” the minister said.

“That means rising to the challenges and exploiting the opportunities. The opportunities lie in the forces shaping market developments, and dealing with the challenges and promoting sustainable dairy growth is best facilitated through ongoing implementation of the Food Harvest 2020 strategy,” he added.