Brussels unlocks 500 million deal with the crisis milk – Les Echos

After various hesitations, the European Commission has finally proposed on Monday at the Council of Ministers of Agriculture, a new financial help for release including the dairy sector to face the current crisis. Phil Hogan, the Commissioner in charge of the case has put on the table a new budget of 500 million euros, which complements that of the same amount, announced in September 2015 and for the dairy and pig farming.

In addition to taking note of the crisis in the dairy sector since the end of quotas, the new device is an undeniable political shift since its implementation implies “finally the question of a minimum production control”, noted Stéphane Le Foll, French Minister. And it added that it hoped that this change in doctrine “will serve as a precedent for the future,” because “Today, Europe has finally decided to consider that an imbalance would not be solved by the market “.

Concretely, Brussels will unlock the one hand, EUR 150 million, to be used to reduce milk production and, secondly, EUR 350 million which, themselves, can be mobilized in various ways … as long as they do not incite the contrary, production. The first envelope will be sent by Europe to farmers, while each Member State will be responsible for actions that it will implement in the implementation of the second, provided they form part of a predefined list by Brussels, which will support small farms to additional measures to reduce production, through aid to extensive production methods. Each state will receive an amount that will be based on the importance of the sector for its economy, and the number of small farms – France will touch almost € 50 million, Germany 58 million, the UK $ 30 million. Brussels also authorizes each state to supplement these funds for up to double if desired. “Our ultimate goal is to observe a recovery in prices paid to farmers they really need, so they can continue to live from their work,” said Phil Hogan.

Relief and bitterness

On the French side, these measures were met with a mixture of relief and bitterness . “For over a year we say that there is a crisis,” a French source advocates who regrets the slowness shown by the Commission and certain states. Since the abolition of milk quotas, which occurred on 1 ^st in April 2015, the financial situation of European producers has deteriorated rapidly: while European production increased, the Russian embargo reduced some opportunities to export and Chinese demand was weakening. This discrepancy between supply and demand has long been relativized by Brussels, while many countries liberal tradition abounded in the sense of “laissez-faire”. The funds released last September were therefore placed in a rather distant approach the expectations of France. In March 2016, a shift was noticeable, especially since Brussels was proposing to authorize the unprecedented activation of a device for creating temporary agreements between producers to reduce production. It was not until June that Phil Hogan took note of the crisis and promised new measures.

Gabriel Grésillon, Les Echos

Brussels Office

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