Representatives from the European Commission (EC), the European Council and the European Parliament attending trilogue negotiations regarding the CAP Reform reached an agreement yesterday.
Among their decisions was one not to adopt the proposed implementation of milk supply management in times of crisis.
In a ‘time of crisis’ the supply management system would require milk suppliers across European Union (EU) Member States who had increased their production levels to pay a penalty, while aid would be paid to those who had reduced production.
According to the EDA, which represents the interests of dairy processors in the EU, the trilogue's decision not to adopt a milk supply management system in times of crisis will provide the processing sector with additional “predictability and stability.”
Decision gives sector "stability" needed to develop
“We especially appreciate the development into a more market oriented approach of the new CAP, particularly as the Council and Parliament have decided to not reintroduce supply management through the back door,” said EDA secretary general, Dr Joop Kleibeuker.
“This agreement will give the sector the predictability and the stability it needs to fully develop and participate in the growing world market.”
“EDA sees this political agreement as the confirmation of the basic decision taken in 2003 to proceed with a market orientation framework for the dairy sector.”
The EU Agriculture Committee will now vote on the full package of proposed CAP regulations.
The CAP package must be approved by both the EU Agriculture Committee and the full House before it can be submitted to the European Council. The European Council must also approve the agreed texts before they enter into law.
The EU trilogue negotiations were initiated following a vote in the European Parliament in March 2013, where MEPs agreed on a mandate for negotiations on amendments to the CAP.
Among its decisions was to support the introduction of a milk supply management system in times of crisis.
Supply management alternative?
Earlier this month, the EDA called on trilogue representatives to consider the adoption of an intervention purchasing system as an alternative and “viable measure” against milk price volatility.
The EDA argued that the adoption of an intervention purchasing system – where excess raw milk would be purchased by an intervention agency to stabilise prices – would be a “more effective” way of addressing milk price volatility than milk supply management.