Thursday 29 September 2016

Farm bodies clash on EU dairy package

Declan O'Brien and Ken Whelan

Published 30/08/2016 | 02:30

ICMSA president John Comer
ICMSA president John Comer

The IFA and ICMSA have clashed on how a new €22m support package for the dairy sector should be spent.

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While IFA has suggested that the aid package be used to guarantee low interest farmer loans, ICMSA has called for funds to be distributed as a direct payment worth €1,200 per milk supplier.

"Unlike other sectors, there are no coupled support schemes in place for dairy cows comparable to the BDGP in place for suckler cows and the new sheep payment being introduced," the ICMSA president John Comer pointed out.

In contrast, the IFA has called on the Minister for Agriculture, Michael Creed, to use the aid package to provide farmers with "low-cost short-term loans, or otherwise help them with their cash flow difficulties."

IFA dairy committee chairman, Sean O'Leary, said any such loan package could be based on the €15,000 state aid concession agreed in Brussels earlier this year.

However, ICMSA claimed that involving the banks in the dairy crisis scheme equated "to a bank subsidy".

The EU Commission's Management Committee gave the green light to the €500m aid package for the dairy sector last week. Ireland has been allocated €11.1m of a €350m dairy fund. Member States can opt to match this funding, which the Irish government is expected to do.

The package also includes a 14c/l payment to dairy farmers who agree to cut production this autumn and winter; and an extension of the intervention period for skim milk powder.

It is still unclear how Minister Creed aims to allocate the direct aid funds but he said priority would be given to measures which delivered "value for money while offering structural assistance to farmers in helping to tackle ongoing liquidity issues."

Slowdown

Speaking at last week's Virginia Show, Agriculture Commissioner, Phil Hogan, said Irish dairy farmers had not shown any immediate interest in the scheme, dairy farmers in Germany and France were enthusiastic about the measures.

The slowdown in Europe's milk supplies appears certain with the British dairy herd down by 2pc in the past year - the biggest annual drop in four years.

Also revealed in the last week were figures that show EU monthly milk output is lower than the same period in 2015 for the first time.

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