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Monday, 13 December 2010

Milk price crisis: Agriculture Committee's first reactions to Commission plan

The Commission's proposed regulation on contractual relations in the dairy market was generally welcomed by the Agriculture Committee on Thursday. However, MEPs also stressed the need to curb price volatility and worried that proposed ceilings on the size of producers' organisations were too low to enable them to improve farmers' negotiating power in the supply chain. The key aims of the proposed regulation are to rebalance power in the food supply chain, prepare producers for the end of the milk quotas in 2015 and ensure medium-term prospects for EU dairy products, said Agriculture Commissioner Dacian Ciolos, presenting the proposal to MEPs. The market can be made to work better, proposed Mr Ciolos, by facilitating the creation of producers' organisations better able to compete with food processing industry. However, these organisations should not represent more than 3.5% of EU production or 33% of national production, so as to prevent the creation of monopolies, he added.The proposal, approved by the College of Commissioners on Thursday, also calls for greater transparency, through a reinforced "European observatory", involving Member States' representatives and stakeholders, to provide producers with up-to-date data on market trends, and enable them to make informed decisions. It also suggests creating inter-professional groups to encourage discussion among all players in the food supply chain. The proposed regulation would expire on 2020.

Source: European Parliament