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Independent.ie

Monday 5 December 2016

IDIA warns that origin labelling will hurt sector

Published 22/06/2010 | 05:00

MANDATORY country or farm of origin labelling on milk could damage Ireland's dairy industry, the Irish Dairy Industries Association (IDIA) has warned.

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As an exporting country targeting post-quota expansion, mandatory labelling could restrict Ireland's access to the 540m consumers in the European market, Michael Barry, IDIA chief executive, has cautioned.

The High Level Group (HLG) on milk last week recommended that the European Commission to "consider the feasibility of different options for obligatory/ voluntary place of farming labelling of basic primary dairy products".

The IDIA concerns follow a vote by the European Parliament last week to extend country of origin labelling to dairy products.

The European Dairy Association has condemned the move, saying country of origin labelling would discourage EU trade, reduce sourcing flexibility, and force companies to change labels regularly. The bill will now pass to the Council and then it is likely to return to parliament for a second reading before becoming law.

"IDIA does not see any need for additional labelling on origin. It would undermine the internal market and hinder free trade," said Mr Barry.

The IDIA has also criticised the HLG's report for failing to develop a broader reflection on the competitiveness of the whole sector, beyond discussions on bargaining power at the first step of the chain.

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"A key priority of any dairy policy should be to encourage the creation of value through the whole chain and the development of markets for dairy products.

"There was no reference in the report on where to go to sell any surplus milk in the future," he said.

The IDIA also called for more detail on providing a safety net for milk producers and instruments aimed at reducing price volatility. In relation to contracts, the processor representative body said they could be useful on a voluntary basis. But Mr Barry warned that member states might make the use of contracts compulsory.

He was sceptical that compulsory contracts would help operators take into account the signals of the market and adapt supply to demand, as was asserted in the HLG report.

"Nobody would be happy with the Commission deciding terms or prices over a period of time," he said.

He added farmers should not be forced to maintain milk production when the market was at a low or forced to reduce production when it was high.

The IDIA warned that producer organisations which acted solely as selling agents -- as opposed to taking full ownership of the product -- should not be granted a block exemption from competition rules.

Mr Barry said the Commission had to be aware of the needs of existing dairy processors when framing policies for the sector. "The Commission should make sure that any measures do not undermine the integrity of producer co-ops or discriminate against private dairies," he said.

Irish Independent