Crisis in the pig and dairy sectors: the Commission put forward a package of measures

During the exchange of views which took place in the extraordinary meeting of the Agriculture Council, ministers expressed strong concerns about recent developments in a range of agricultural sectors, in particular the dairy and pigmeat sectors.

In response to the difficulties currently being faced by these sectors the Commission put forward a package of measures worth EUR 500 millions. These measures are intended to help address difficulties in cash-flow faced by farmers, stabilise markets and address the functioning of the supply chain.

While supporting the package presented by the Commission, delegations underlined the need to be more precise about the content of the package. The provision of direct targeted aid scheduled by the Commission, in particular the allocation between member states and the affected sectors, is a key point for many delegations. As regards the facility to advance part of the direct payments and rural development payments, most ministers emphasized that flexibility in the controls was needed to help facilitate implementation. In general they considered that, over the medium term, the strengthening of promotion measures and the planned work on the supply chain were important issues.

Some member states pointed out the interest of a temporary increase of the intervention price for skimmed milk powder. Many delegations supported also the Commission in its negotiations with Russia on sanitary issues for pigmeat. The possibility to relax the state aids regime was also mentioned by some delegations.

Among the measures proposed by the Commission, the Council noted in particular:

• the facility for member states to advance an important part of direct payments and rural development payments from mid-October;
• the reopening of private storage for pigmeat;
• an additional funding for promotion of dairy products and pigmeat in the EU and third countries: the Commission will increase the promotion budget in 2016 in addition to the €81 million already committed. A specific part of that enlarged budget will be reserved for the dairy and pigmeat sectors. The reformed promotion policy which also foresees higher co-financing rates (from 50 to 70-80%), a broader list of eligible products (including generic pigmeat promotion on the internal market), and a gradually increasing budget (up to 200 million € in 2019).
• a further intensification of efforts to tackle non tariff barriers in third countries;
• the establishment of High Level Group to improve the functioning of the supply chain with possible improvements for farmers. This will include credit for farmers, and financial and risk hedging instruments such as futures markets for agricultural products.

The Presidency indicated that technical aspects of the Commission package will be examined by the Council preparatory bodies in the coming days. The ministers will come back on the issue on the occasion of the informal agriculture meeting in Luxembourg on 15 September.