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Explore the impact of Copa and Cogeca on dairy cooperatives, world milk production, market trends, and EU policy measures for farm income support and trade issues.
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Dairy market and EU policy developments Mansel RAYMOND, Chairman of Copa and Cogeca Working Party on Milk and Dairy Products| Marketing dairy cooperatives, 27.09.2016, Chodov, Czech Republic
Dairy cooperatives • 58% of the market share at EU level • add value to their members and members’ product • an important link in the milk supply chain • ensure market access for their members • add vitality to the local economy and environment, including in areas facing natural handicaps. • help their members coping with market volatility and provide a better price on the condition that they have a large market share in a particular country.
World milk production Source: DG AGRI
EU milk production Source: DG AGRI
World demand Source: DG AGRI
World and EU exports Source: DG AGRI
Sales of dairy products at retail level in the EU Source: DG AGRI
In summary: • Global demand has been mixed • SouthEast Asia, Mexico, Africa - good • stagnating global economicgrowth: weakcommodityprices (oilprices), declining capital and investment flows into developing and emerging markets + Russian ban, China? • But there are positive signs. • Increasing world production startingwith 2014, stocks? • Significantincreases in domestic use of dairyproducts but not for liquidmilk • Depressingmilk and dairycommodityprices and severe cash flow difficulties for farmers • but dairycommoditypricesrecoveringsinceJune
Copa and Cogeca requestsFirst package of measures (September 2015) • Farmincome, cash flow: • advancing direct payments • ensuring the return of the super-levy back to the sector • keeping open the public intervention and PSA for butter and SMP • allowing the PSA for cheeses • reviewing the intervention price for butter and SMP • increasing the promotion budget
Copa and Cogeca requestsFirst package of measures (September 2015) – cont’d • New marketopportunities • alternative markets + SPS and anti-dumping measures • Cover the riskwith new markets, throughcredit export insurance • Food chain • continuity of the milk package beyond 2020 • define abusive practices at EU level • + a comprehensivetoolbox to copewithexrememarketvolatility
Copa and Cogeca requests Second package of measures (February 2016) • Farm income, cash flow: • Simple financial instruments (help farmers maintain their investments and refinance their loans) • Reduce the cost of inputs by removing import duties, especially for fertilisers, machinery, and other production factors • Grant flexibility with business plans in the second pillar, state aid, and adjust the ceiling for de minimis aid • Promote flexible and dynamic risk management tools • Temporarily increase the intervention price for SMP and butter
Copa and Cogeca requests Second package of measures (February 2016) – cont’d • Trade issues • Re-open the Russian market • Accelerate negotiations with Japan, support TTIP (markets in development, focusing on value-added products) • Credit export insurance and promotion • Food chain • Better functioning food chain (price transparency, preventing delays in payment, curbing unfair trading practices) • Voluntary production initiatives: Article 222 of the single CMO
Copa and Cogeca requests Third package of measures (July 2016) • The priority: farmers’ liquidity • A new package of measures to support the sector, using additional funds without affecting the crisis reserve • New markets + export credit insurance/guarantees
In the near future • There isstillneed to tackle: • The open question of origin labelling for milk and dairyproducts • The reinforcement of the milk package (contractterms, collective negotiation) • A toolbox to copewithmarketvolatility • Unfair commercial practices