Small farmers protest against planned abolition of EU milk quotas

Agriculture and Rural Development Commissioner Mariann Fischer Boel said: "Under our current Regulations, the milk quota system will expire in 2015. We will not renew it. This should now be taken as read, so that we can concentrate all our efforts on the next issue: how to give the sector a "soft landing". It's in the sector's interests that we all prepare for a world without quotas. I strongly believe that increases in quotas should be part of the package." 

But that view is disputed by Gérard Choplin from the European Farmers Coordination association (CPE). "The Commission, even though it says so, does not necessarily want to keep a high milk price. For this reason, it has regularly increased the milk quotas to increase production and keep up the pressure on the milk price. Nobody wants to pay any compensation, so it is better if the value of a quota falls - that's the Commission's aim." 

Choplin also argues that retailers and the dairy industry have an interest in putting an end to regulation to get cheaper milk. "The bigger the farms, the less the industry has milk-collecting expenses and the lower the price. Therefore, when the milk prices soar, the biggest profits go to the agri-food industry and retailers. This is also because the retail sector is too concentrated in some countries, such as the UK and France, and there is not enough competition," said Choplin.

The CPE asks for regulation of the European milk market to be maintained beyond 2015 by preserving milk production quotas while improving their implementation. The milk quotas, they argue, "are indispensable tools to balance the markets and to provide stable prices for both producers and consumers".

The farmers also ask for the practice of exporting dairy products at prices below production costs to be stopped and in exchange, prevent low-priced imports. "The increased instability of agricultural markets and the increasing volatility of prices are incompatible with the maintenance of sustainable human-scale dairy farms in all regions of Europe where milk production has good natural conditions," states the call for action.

The European Dairy Association (EDA), the platform for the European dairy industry is broadly in favour of abolishing the quotasa. It said that "the merits of the milk quota system are now difficult to justify given past CAP reforms removing market support mechanisms. To prepare for the end of the quota system, appropriate phasing-out measures are necessary. Up to now, as there is no clear policy direction from the Commission on quota reform, European dairy farmers continue to acquire additional milk quotas. This prevents on-farm investment and acts as a barrier to entry for young farmers and potential new entrants." 

The association agrees with the small farmers' concerns over the declining number of European dairy farmers in some areas and states that "it is questionable how producers in such areas can retain financial viability as the EU moves to an unsupported market system".  

The EDA also warns that a "policy of unsupported markets coupled with cheap food policy and costly regulatory mechanisms could result in food production declining sharply in certain areas." Therefore, the EDA urges the Commission to acknowledge that not all regions can operate traditional dairying practices in an unsupported market environment and that targeted funding of rural development initiatives is needed "to ensure that the European family farm is not undermined."