Introducing a minimum guaranteed price of milk in the European Union (EU) would create a “safety net” for milk producers and it should be determined based on average production costs of unprocessed cow milk, Slovakia’s Agriculture Minister Stanislav Becík said, as reported by the SITA newswire.
At the meeting of EU’s Agriculture and Fisheries Council in Brussels on March 23, Minister Becík proposed the minimum guaranteed milk price at 40 euro cents per litre. He said it is also necessary to adopt market measures for preservation of competitive strength of the dairy industry in the world market. Such measure may be, for instance, permanent export refunds and minimization of cheap imports from third countries, as well as re-introduction of subsidies for processing of powdered milk into fodder mixtures or foodstuffs.
Becík further proposed compensatory payments to milk producers to overcome the Europe-wide crisis in the milk sector that would compensate for losses caused by the drop in purchase prices under the level of production costs.
“The volume of such compensatory payments would be set for individual member states as the difference between average production costs and average purchase prices,” SITA quoted Becík as saying. The system of compensations should remain in effect until the market in the EU regains balance, he suggested.
In order to improve business relations between dairy market participants, he suggested introduction of a common European system to monitor distribution of the margin in the supply chain between “farmers – the processing industry – retail trade”. SITA
Compiled by Michaela Stanková from press reports
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