Milk production growth is ‘the opposite of heeding signals’

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Commissioner Hogan told those in attendance that markets are weak, driven by an oversupply in production as well as the overhang of skim milk powder (SMP) stocks. There is some 380,000t of SMP in intervention waiting to be sold.

In relation to SMP stocks, the product has to be sold

“EU milk deliveries increased by 440,000t in September 2017, with growth particularly notable in Ireland, France and Germany. This appears to be the opposite of heeding market signals.

“I made this point strongly two weeks ago when I addressed a large gathering of dairy operators at (the Irish Farmers Journal Dairy Day event) in Punchestown.

“I pointed out that in the Netherlands, Friesland Campina has written to suppliers calling for restraint. I believe it is very important that industry acts in concert across all EU member states to manage the supply side. Policymakers have a responsibility in this regard.”

SMP management

Speaking directly about SMP and the worry it is causing the dairy sector, Hogan once again reiterated the need to sell of the 380,000t of SMP.

“In a similar way, when it comes to the issue of SMP stocks, we have to manage public intervention from two angles: first, how to realistically proceed with the release of existing stocks; and second, how to prevent any further buildup next year.

“In relation to SMP stocks, the product has to be sold. We also need to avoid buying-in under public intervention next year without due market justification. The European Union does not exist just to provide an outlet for product for which a commercial market cannot be found.”

Future of farming

The commissioner committed to delivering a better a future for farming, especially in the light of the Common Agricultural Policy (CAP) proposal he published last week.

“I will continue harnessing trade to bolster farmer incomes, because good food, sustainably produced, means good business and I know that, in this endeavour, I will have the full support of the Department and its agencies and the wider agri-food community.”

 

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