Dairy sector to receive emergency EU funding following Russian trade ban
The European Union will use agricultural funds to help EU producers store butter, Skimmed Milk Powder (SMP) and cheese, to help diminish the impact of the Russian ban on EU food imports, the Commission announced on Thursday (28 August).
Earlier this month, Russia banned the import of certain foods and drinks originating from the European Union as a response to Western sanctions over Ukraine’s crisis. The European Commission is using a Common Agricultural Policy measure called Private Storage Aid to help finance the cost of the three to seven months temporary storage of butter, SMP, and several types of cheese.
However, the Commission has not specified the amount it intends to disburse to the dairy industry.
EU Agricultural Commissioner Dacian Cioloș said in a statement that various member countries experienced losses in the dairy market, and the demand for new storage has outlets increased. He also said that the European Commission is ready “to act pre-emptively to stabilise the market.”
Russia is the primarily export destination for the EU's meat and dairy products. In 2013, exports to Russia were worth €2.3 billion.
Despite the EU funding commitment, the European Farmers Union Copa-Cogeca called for more support.
“Milk prices in some cases are going down by as much as 30%,” said Copa-Cogeca Secretary-General Pekka Pesonen. “Further action is crucial. We also need to work hard to find new market outlets for our produce and speed up promotion campaigns to stimulate new demand,” he explained.
Apart from the emergency market support measures for the dairy sector, at the beginning of August, the Commission announced roughly €32 million aid for peaches and nectarines, and €125 million for perishable fruits and vegetables.
Agriculture ministers will meet on 5 September to discuss the consequences of the Russian ban, and measures required to make up for export losses.
Commissioner Cioloș will present an analysis of the short and medium consequences by the Russian trade embargo on the internal market.
The crisis in Ukraine erupted after its former President Viktor Yanukovich cancelled plans to sign trade and political pacts with the EU in November 2013 and instead sought closer ties with Russia, triggering protests that turned bloody and drove him from power.
Moscow annexed Crimea in March following a referendum staged after Russian forces established control over the Black Sea peninsula in the biggest East-West crisis since the Cold War. The situation has worsened since then. Pro-Russian rebels organised a referendum in Donetsk and Luhansk and declared the regions independent.
In an attempt to encourage dialogue and de-escalate the conflict between the pro-Russian militants backed by Russia and the Ukrainian authorities, the EU has imposed sanctions on a number of key persons in Putin's administration. Moscow retaliated back imposing a trade ban on a number of agricultural products and raw materials originating from the Western economies, including the EU.
- 2 September: Meeting of the EU agricultural experts in the Council
- 3-4 September: Meeting of the European Parliament Agricultural Committee
- 5 September: Extraordinary meeting of EU agriculture ministers
- 13-14 October: EU agriculture ministers meeting