Coveney warns superlevy fines of up to €10m are looking likely
Agriculture Minister Simon Coveney has warned dairy farmers that a repeat of the February/March production pattern from last year will result in a superlevy this year.
Mr Coveney said: “While I acknowledge the continued efforts by dairy farmers and their co-operatives to avoid exceeding the national quota, the responsibility for the management of milk quota rests with the milk producer, whose duty it is to ensure that the enterprise remains within quota.”
National production was marginally under quota at the end of January. Mr Coveney emphasised that the current quota system will continue to operate until 2015. Despite his efforts to achieve an adjustment to the quota regime at EU level, he said there is not enough support among other member states to bring about a change at this juncture.
The IFA also confirmed yesterday it has not received any positive response from the EU following the visit to Brussels earlier this week of a high-level IFA committee. IFA national dairy committee chairman Kevin Kiersey and IFA dairy secretary Catherine Lascurettes were among those to meet with EU Commission officials to review a potential ‘soft landing’ in the run-up to 2015, and the end of the EU’s milk quota restrictions.
In tandem with other members of the European farm group COPA, Mr Kiersey made a strong case for the recognition of the absence of a ‘soft landing’ in Ireland in the context of the review, and the need for additional measures to help Irish and other EU dairy farmers deal with rising quota prices and superlevy fines before 2015.
Unfortunately, Mr Kiersey warned that, with dairy markets softening in 2012, both the EU Commission and the majority of European farm organisations had hardened their position on the topic. “We are totally committed to feeding into this year’s review to obtain recognition of our problem, but prudent dairy planning on Irish farms must assume no change before 2015. If our campaign is successful, it will be a bonus.
“The EU Commission’s definition of the ‘soft landing’ — a reduction in quota prices, and production falling below quota — is simply not occurring in Ireland and in a small number of other milk-producing member states including Germany, Austria, Denmark and the Netherlands. Instead, rising quota and superlevy costs are damaging the competitiveness of dairy farmers in Ireland and in those other countries — those with the greatest potential to generate additional export revenue for the EU economy post-2015.”
Mr Kiersey said the IFA has shown that the weighted average price of milk quota through the Irish Milk Quota Trading Scheme has increased by over 230% since 2010, while the average allocation has fallen by 76%.
The IFA also reminded the EU Commission a small amount of additional flexibility in the EU before 2015 will have little influence on the global supply/demand balance and international price volatility.
