Markets don’t regulate, markets speculate

Press release

Brussels, 14 July 2016

In light of the upcoming European Agriculture and Fisheries Council meeting this July 18 in Brussels, the European Coordination Via Campesina, which represents thousands of family farmers in Europe, urges the Council to introduce mandatory measures to reduce milk production in order to protect dairy farmers throughout Europe.

The recent meetings in Brussels between actors of the dairy sector leave no doubt about the current situation. The sector is caught in a series of crises and the view that only the control of production will solve the problem is now unanimous. The non regulated market, subject to speculation, is wiping out producers; it is therefore necessary to act on the market. The support offered by the CAP – or the funds released in parallel to support producers, as has been proposed by representatives of some Member States- are not and will never be sufficient.

Everything seems to indicate that the proposals that will be put on the table at the 18 July Council meeting continue to be based on individual voluntary reduction. There is no collective approach to the current situation. We would be talking about a 3 month measure, with a budget of around 200-250 million euros, which- according to the Commission- would amount to an incentive amount of 100 euros per 1000 liters not produced for a current period benchmarked to the same three months of a period which has yet to be determined. However, if the reduced volume were to be significant then a “stabilizer” would be set up, therefore reducing the impact of the measures.

Thus, the lack of regulatory measures and mandatory limitation could push some farmers to reduce their production while others increase it, consequently rendering these measures absolutely ineffective for regulating the market. What’s more, the concentration of production on factory farms and those areas of Europe with close links to the agro-industry and large distributors continues to be promoted.

For ECVC and its member organisations, only the implementation of market control measures, the mandatory reduction of milk production and the establishment of a crisis prevention mechanism will be able to address the problem of overproduction ensued from bad political decisions.

In the context of another crisis currently faced by the European Union, a crisis of political legitimacy, this is a chance for its leaders to show their fellow citizens the EU’s commitment to its founding principles, those of a People’s Europe, mindful and supportive, promoting unity between its various regions and producers, instead of competition.