ICOS urge rejection of CAP reform
The warning from Donal Cashman, the president of the Irish Co-operative Organisation Society (ICOS), came as European Union farm ministers prepare to resume negotiations this Wednesday on the latest reform package tabled by Commissioner Franz Fischler.
ICOS estimates that the proposals, if fully introduced, could cost dairy farmers a net income reduction of €162m annually after allowing for compensation of about €186m.
The Irish dairy industry supports 27,000 farm families, employs a further 7,200 people and has total output of €3.1bn with exports valued at €1.1bn.
Mr Cashman said that the current proposals would reduce farm-gate milk prices by 6.65 cent per litre (23.8 pence per gallon).
Compensation for these price cuts was inadequate at 3.55 cent per litre of existing quota (12.73 pence per gallon), he said.
Such a development would result in a net shortfall in milk income of about 3.1 cent per litre (11.1 pence per gallon).
This would be equivalent to an income cut of €6,200 per year for an average producer with a quota of 200,000 litres (44,000 gallons).
Mr Cashman said Agriculture Minister Joe Walsh must reject these “unacceptable proposals” and ensure that there are no price or other reductions beyond the Agenda 2000 Agreement.
He reconfirmed the co-operatives’ strong opposition to the proposal to limit butter intervention purchases to 30,000 tonnes in the March to August period each year.
This would be particularly damaging for Ireland and it was unacceptable, as it amounts to an additional price cut without compensation.
Mr Cashman said that ICOS estimates that implementation of this proposal could depress butterfat values across all dairy products by an additional 5% or more in weak market years.
At current prices, this depression would be equivalent to an additional €36m reduction per year in value to the Irish milk pool, he said.
