Dehydrated preserved milk for human consumption - Common organisation of the milk and milk products market - Additional rules on the common organisation of the milk and milk products markets (debate) 
President
The next item is the joint debate on
the report by Elisabeth Jeggle, on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council directive amending Directive 2001/114/EC relating to certain partly or wholly dehydrated preserved milk for human consumption - C6-0083/2007 -,
the report by Elisabeth Jeggle, on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council regulation amending Regulation (EC) No 1255/1999 on the common organisation of the market in milk and milk products - C6-0084/2007 -, and
the report by Elisabeth Jeggle, on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council regulation amending Regulation (EC) No 2597/97 laying down additional rules on the common organisation of the market in milk and milk products for drinking milk - C6-0085/2007 -.
Mariann Fischer Boel
Member of the Commission. - Mr President, let me start by thanking Parliament, the Committee on Agriculture and Rural Development and in particular the rapporteur, Ms Jeggle, for this constructive report on the milk mini-package.
The package provides amendments for three legal acts. The first concerns the Directive on preserved milk, in which we now allow standardisation of the protein content, totally in line with the Codex standards. This meets a longstanding request from our dairy industry and exporters of milk powder, and their position vis-à-vis their competitors in third countries will clearly improve.
Not only industry and trade, but also milk producers - our farmers - stand to benefit because this standardisation of protein can yield a higher valorisation of the milk. Furthermore, the forecasted strong demand for proteins will easily absorb the increase in the available quantities of proteins. I welcome your full support for this proposal.
The second proposal concerns the common market organisation for milk and for milk products. Here we propose a whole series of adaptations on which the European Parliament has expressed its full support. These include the proposal to reduce the intervention price for skimmed milk powder as a mathematical result of lower protein content owing to standardisation. It contains an elimination of the price-trigger system per Member State in the butter intervention system. It also contains the abolition of the national quantities for butter as an eligible criterion for aid, removal of the obsolete aid for military forces and abandoning the compulsory use of import licences.
Your amendment for maintaining the private storage of cream and skimmed milk powder is a little surprising because these schemes have never been used in practice and can be considered obsolete. Furthermore, private storage for butter is maintained, so there is really no need to maintain the scheme for cream.
Concerning your amendments on the school-milk scheme, we are on the same wavelength. As we have proposed, the system will be simplified by introducing one single rate of aid. DG AGRI was already exploring the different possibilities of reviewing the school-milk scheme and had invited Member States to provide suggestions for trying to improve the system, as well as for additional products to be covered by the scheme. The resulting changes in the system will soon be presented in the Milk Management Committee. I hope that an agreement between Parliament, the Council and the Commission can be found on the increased aid level for school milk, up EUR 18.15 per 100 kilograms.
Concerning your amendment that would introduce a milk fund to finance a restructuring programme, I would underline that the proposals contained in the milk mini-package are really not of a restructuring nature. I therefore have great difficulty in correlating these basic technical and simplification measures with a perceived need to establish a new 'milk fund' budget line. Discussions on the need for appropriate measures for the milk sector should take place in view of the upcoming health check discussions and the various discussions we will have on the future of the common agricultural policy.
The third act concerns liberalisation of the drinking-milk market, where I note that we are also on the same wavelength. The suggestion to delete the 0.2% tolerance for the fat contents seems to be acceptable. You also propose that a reference be made to Directive 2000/13/EC. Please be informed that this Directive automatically applies.
So, all in all, I note with pleasure that our views are in line with one another. Thank you for all your work. I look forward to our continuing discussion tonight.
Elisabeth Jeggle  
rapporteur. - (DE) Mr President, Commissioner, ladies and gentlemen, everyone is talking about the good and stable market situation for milk and milk products at the moment and the resulting rise in milk prices. The rise in milk prices urgently needed by farmers is providing new fuel for the much-disputed question of quotas.
Today I want to discuss the mini milk package and begin by taking the opportunity to thank the Commissioner and her colleagues for the good cooperation. They have presented three good and well-thought through proposals and Parliament is, therefore, not tabling many amendments. I do believe, however, that our draft amendments provide some food for thought and I hope the Commission and the Council will endorse them in the same way as the Committee on Agriculture.
The first report submitted by the Commission contains amendments to the Council directive relating to certain partly or wholly dehydrated preserved milk for human consumption. In this report, the Commission proposes standardising the protein content at a minimum of 34%, expressed in fat-free dry matter. That standardisation will make it possible for European manufacturers to compete with manufacturers in third countries under the same conditions. This simplification of international trade is welcome and is one reason why the Committee on Agriculture adopted this report without amendments and with only one vote against.
Such standardisation saves money, which is why in the second report I proposed a milk fund programme to ensure that the milk sector could retain any saved money. The Commission proposal amending the regulation on the common organisation of the market in milk and milk products provides for several important technical adjustments, which will clearly also lead to improvements.
Firstly, it will reduce the intervention price for skimmed milk powder by an average of 2.8%. By removing the intervention trigger for butter, abolishing national quality classes for butter, introducing a standard quality definition, removing disposal aid for military forces and abandoning the compulsory use of import licences, we are reducing the red tape.
I am, however, quite definitely against abolishing private storage for cream and skimmed milk powder. It represents a safety net and I believe we should discuss this in the context of the Health Check and not of the mini milk package. Aside from that, the proposal to introduce a single rate of aid for school milk is no doubt right. Given the nutritional importance of school milk, however, the aid for products falling within that regulation should be increased substantially, from EUR 16.11 per 100 kg to EUR 18.15 per 100 kg. It is also urgently necessary to broaden the range of products.
Some fantastic new milk, quark and yoghurt products are now available, which can cater for everyone's tastes and likes, and if we introduced innovative school programmes we could whet children's curiosity about those products while also doing something for nutrition. The potential EUR 117.3 million in savings resulting from the standardisation of protein for the period 2008-2013, or possible further savings within the milk market organisation, should be used to accompany and support milk sector reform. I would be quite prepared to discuss that too in the context of the Health Check debate.
This measure is intended to facilitate our proposed milk fund programme. The resources could be used, in the context of promoting milk sector sales, for better nutritional information and also for further accompanying measures such as modernising milk production, in areas where conditions are more difficult and in mountainous regions. The committee unanimously adopted this second report.
The third report concerns drinking milk. It proposes increased flexibility in the definition of drinking milk. The current regulation recognises three categories of drinking milk that can be produced and marketed in the Community. These are skimmed milk (maximum 0.5% fat), semi-skimmed milk (1.5% to 1.8% fat) and whole milk (at least 3.5% fat).
The Commission's proposal to allow the production and marketing of drinking milk that does not comply with those three categories, as long as a clear and easily readable indication of the fat content is given on the label, is right. This liberalisation measure will not only mean that transitional national derogations can be removed but also broadens the consumers' options, which could certainly help revive intra-Community trade.
To avoid any uncertainty, the fat content percentage of the milk should be clearly visible on the packaging and directly linked to the product description. Yet I think it is unnecessary to set a tolerance margin of +/-0.2% when indicating the fat content, since that would not improve clarity but be more likely to hinder implementation.
These two draft amendments, like this third report, were also adopted unanimously in committee. Given the clear position taken by the Committee on Agriculture, I am confident that the entire mini milk package will be endorsed by a clear majority during tomorrow's plenary vote too.
I cannot, however, accept the ALDE Group's three draft amendments. They do not substantially improve the report. The third draft amendment refers only to school milk, which would go against what we want, namely to improve supply of the entire range of products. That is why I must, unfortunately, reject that draft amendment too.
I extend warm thanks to all colleagues in the Committee on Agriculture and in the Group. I thank them for their trust and for the good working relationship.
Struan Stevenson
on behalf of the PPE-DE Group. - Mr President, I wish to begin by congratulating Mrs Jeggle on her three reports - the mini-milk package. It was very clear right from the start that there was general agreement on her reports, and that was demonstrated by the Commissioner. Members asked for this debate so that they could discuss the wider issues affecting Europe's dairy industry, and I will be no exception to that.
Until very recently, dairy farms were the Cinderella sector of the UK farming industry. Thanks to murky economic practices, which allow supermarkets to squeeze down the price of milk to 17p per litre while they sell it on to the public at 50p a litre, many of our dairy farmers were going out of business. It is worth remembering that even at 50p per litre, milk is still half the price of bottled water in our supermarkets, and you do not have to calve a bottle of water or send for the vet to attend to its needs.
Until quite recently, of the 27 EU Member States, only Slovakia, Estonia, Hungary and Lithuania had lower milk prices than the UK, and the result has been that in the last five years in my constituency in Scotland we have lost around 500 dairy farmers. There are now an estimated 1 400 dairy farms left in Scotland - that is all. It is estimated that across the UK one dairy farmer is leaving the industry every day.
It is only now as world cereal prices - in particular wheat - have almost doubled, forcing up the price of feed, and as pressure on productive farmland grows for biofuels and other non-food crops, that some supermarkets have finally begun to panic at the prospect of an actual milk shortage and, as a result, have started paying dairy farmers a slightly higher price. At long last, dairy farmers have begun to see some light at the end of the tunnel and they are at least getting more than the cost of production for their commodity.
Rosa Miguélez Ramos
on behalf of the PSE Group. - (ES) Mr President, I would also first like to thank the rapporteur for her excellent work which has allowed us at all times to feel comfortable with her proposals. I would also like to thank her especially for allowing the oral amendment I tabled on the school-milk scheme.
Having said that, what I would like to do is reiterate my criticism on moving this mini-reform forward when major reform of the COM is anticipated next year and November will see a CAP 'Health Check', and as yet, Commissioner, we obviously do not know whether this will have any consequences for the sector.
But today, Commissioner, reality, and Mr Stevenson explained this, is taking us in other directions. The price crisis in agricultural produce has resurrected the debate on the issue of agricultural food production in Europe.
My assessment of the milk crisis differs from yours. In my opinion, the main cause of the rise in milk prices lies not in increased consumption in Asia but in low Community productivity. Indeed, yield last season was the lowest of the last 15 years.
Some organisations say that Europe is likely to need an extra thousand million litres per year to satisfy its needs. Certainly, today, consumers are overwhelmed by the increase in prices of basic foods and farmers in turn by the price of cattle feed.
Although like you I am of the view that producing biofuels is neither the ultimate nor the main cause of the rise in prices, we should not be fooled, there are others. Neither a fall in set-aside nor a reduction in fallow land will be enough to stabilise prices.
The Commission should be very alert to other types of current speculation, such as the speculation on the stock markets. Large groups will easily be able to pass the increase in prices of raw materials on to the consumer, in fact they are doing this already, but this will be much more difficult for local producers to do, and therefore the rise will penalise the more fragile SMEs most of all.
Indeed, as Mr Stevenson has just said, the increase is not being reflected in the price charged by farmers; they blame the gap between the price paid to them and the price paid by the consumer on a Common Agricultural Policy based on promoting set-aside.
That being the case, Commissioner, I would advise you not to come here and tell us that quota removal will be implemented gradually.
Low morale among farmers who feel insecure about the future of something which they viewed as their own, as a capital asset, namely the quota, whose forthcoming removal has been announced, is one of the barriers to relaunching milk production in Europe; the same was true in its day of the sharp drop in milk prices which led to many producers moving to more profitable, but less labour-intensive crops; those producers will no longer be able to benefit from the price rise.
The arduous job of the dairy farmer is compounded by difficulties in obtaining a quota, difficulties in obtaining cattle... Were you aware, Commissioner that at present European dairy-farmers are having to go to countries like Canada or the United States to buy dairy cows because they cannot find cattle to buy in the Community market?
In view of all this, Commissioner, I would ask you to react, and I am sure you will, appropriately to these new circumstances, circumstances that were unthinkable only twelve months ago and whose consequences for the agricultural food production sector we should begin to debate.
In my opinion we should not merely hope, as I have read in your blog, that the competitiveness of European farmers in world markets will not be too badly affected, but react rapidly to prevent that from becoming the case.
Kyösti Virrankoski
on behalf of the ALDE Group. - (FI) Mr President, first I wish to thank the rapporteur, Mrs Jeggle, for her excellent reports. Milk is one of the most important areas of agricultural production. It is all the more important as beef production is largely dependent on the calves which dairy cattle farms produce. Milk production is also eminently suited to areas where natural conditions are poorest. For example, dairy farming in northern Europe can effectively exploit the fact that the arable land there is an excellent source of coarse fodder, which also makes production resistant to rain, frost and other unfavourable natural conditions.
The proposals before us will simplify EU laws on the dairy industry. The quality class system for butter would be simplified, the strict classification for fat content abolished, aid for school milk made independent of its fat content and the intervention system clarified. These measures seem positive ones and I want to thank Commissioner Fischer Boel for these reforms.
The big question is the overall reform of the milk sector, which is to take place in the near future in connection with the Health Check, the mid-term review of the CAP. Its main focus is milk quotas.
The current balance in milk production has been achieved thanks to milk quotas. It is because of these that the 1 300 million kilo butter mountain, which we still had at the end of the 1980s, has melted away and at the same time it has been possible to guarantee consumers a steady supply and diverse range of agricultural produce. A predictable framework within which milk producers can develop production has also been established.
In my opinion, it is the EU's obligation to guarantee such predictable frameworks for milk production in the future too. This is important because the necessary investments are made to cover periods of time lasting decades and they are massive sums for family farms. Furthermore, the regulation of production is a slow process because it takes around two years before cows are ready for production. That is why it is in the interests of both the consumer and producer to continue with milk quotas. If the quotas are abolished it will mean the investments that farmers have made buying quotas and thereby stabilising production conditions will have gone to waste. With these observations, we would like to support the reports presented.
Zbigniew Krzysztof Kuźmiuk
on behalf of the UEN group. - (PL) Mr President, Commissioner, in taking the floor in this debate, I would like to draw attention to the following issues: first of all, I would like to support the rapporteur's proposal that the savings made as a result of this reform, i.e. the sum of EUR 117 million, could be used to create a milk fund.
Secondly, this fund should be allocated primarily to those milk producers and processors who, as a result of the increasing market liberalisation, have to carry out restructuring at their farms or companies, and also to promote the consumption of milk and milk products, and, particularly, to increase financial support for supplying milk and milk products to schools.
Thirdly, the Commission's proposal concerning abandoning the three categories of milk that have been marketed to date, i.e. skimmed, semi-skimmed and full cream, also deserves to be supported. As a result it will be possible to market milk with any fat content, provided that this is marked clearly on the packaging.
While supporting the solutions contained in the reports prepared by Mrs Jeggle, I would however like to remind Commissioner Fischer Boel that a serious debate is needed on the subject of the amounts and the future of the milk production quotas that are in force in the European Union, since these are glaringly unjust, especially for the new Member States. Commissioner, you promised us this debate when responding to my question on this matter, which was addressed to the Commission in October 2006.
A country such as Poland, with 38 million inhabitants, has a quota of about 9 million tonnes, giving 0.23 tonnes per inhabitant, whereas this amount is 0.33 tonnes in Germany, 0.39 tonnes in France and as much as 0.67 tons in the Netherlands. Poland, which even now has excellent possibilities for developing milk production, just three years after joining the EU, is already very close to the maximum limit and cannot develop it further. This has a very negative effect on the profitability of farms that have specialised in milk production.
Alyn Smith
on behalf of the Verts/ALE Group. - Mr President, I shall be no exception in this debate in offering my group's congratulations to the rapporteur for an excellent piece of work which has achieved the fairly unusual feat of keeping everyone pretty well happy. I would also praise the Commission for acting on this ahead of the health check, because this is a good piece of work which is long overdue.
I shall summarise our own view on the initial comments here from the National Farmers' Union of Scotland briefing. The proposed changes do not necessarily have a direct impact on farmers, but they will lead to simplification, cost savings and efficiencies further up the chain, all of which will improve dairy sector competitiveness and as such should lead to an indirect benefit to farmers through the marketplace.
In my view, the simplification of the school milk regime is particularly to be welcomed. What better way to fulfil so many agricultural, economic and health aims than by encouraging the drinking of milk and milk products by Europe's children? Making the system more logical is, if we are honest, long overdue.
In praising this package I must agree with my Scottish - if not political - colleague, Mr Stevenson, in pointing to the elephant in the room that is the poor prices that farmers still have to endure, because the supply chain is beyond breaking point and too many of those involved in the market are abusing their position. We in the Commission and Parliament here tonight have done our part by making the system simpler. We could just as well ask why it was so complicated in the first place, but we have done our job tonight. Now national and EU competition authorities must intervene forcefully on the side of farmers who, because of de facto abuses of dominant positions in the market by supermarkets in particular, are continuing to receive a pittance for their quality products. As the Commissioner says, the health check is a good opportunity, because until the EU takes action to tackle that elephant in the room, all the good efforts like this package will continue to be overshadowed and lose out in the noise.
Ilda Figueiredo
on behalf of the GUE/NGL Group. - (PT) Generally speaking, we agree with Mrs Jeggle's proposals in the three reports she has presented, notably the proposal to use the budgetary savings to set up a restructuring programme which could be used for marketing support and nutrition information on quantities of milk and milk products.
Similarly, we think it is important to strengthen the scope and quality of the school milk scheme by extending the range of products that can be included in the scheme, operating as a genuine programme to encourage consumption of milk and milk products, more in line with the tastes of children and young people and paying due attention to nutrition and balanced diet.
We also agree that there should be very clear rules on labelling drinking milk, as it seems to us quite right that the fat content should be included in the so-called 'product description'.
Lastly, a note on the times we live in, when milk production is failing to meet current demand because of the need to support less prosperous farmers and milk producers and increase milk subsidies in the areas most in need, notably in Portugal, bearing in mind that in the islands in the Autonomous Region of the Azores, for example, milk production could be increased without expanding the stock density and that this is an extremely remote region where the conditions for milk production are excellent.
Peter Baco
(SK) In the context of the dairy 'mini-reform' being debated, I would like to put special emphasis on the need to adopt at this sitting Amendments 5 and 7 to the Regulation on the common organisation of the market in milk. Amendment 5 provides for a single rate of aid of EUR 18.15/100 kg of all milk in the school milk scheme. There is no doubt that by increasing the aid and simplifying the regime we will help to achieve the goals of ensuring healthy eating and combating obesity among young people.
Amendment 7 sets out the main objectives of the milk fund restructuring programme. The objectives of this programme, such as strengthening nutrition awareness measures and increasing milk consumption, as well as modernising milk production for example in mountain regions, are an incentive for the new Member States in particular. After all, in recent years many new Member States have seen an incredible reduction in milk production and in the number of cattle of more than 50%.
Unfortunately, milk consumption has fallen as a result, to below the amounts recommended by doctors, particularly among children. By approving these three texts the European Parliament can help to achieve a balance between the consumption and production of milk in all countries of the European Union.
Agnes Schierhuber
(DE) Mr President, Commissioner, ladies and gentlemen, I would like to join the rapporteur in extending thanks, for I think the overwhelming endorsement in committee is enough to show what good work has been done here.
The mini milk package is an important step not just for European farming and the milk sector, but above all for promoting the use of milk in nutrition.
Balanced nutrition is especially important for children, and here milk and milk products have a major part to play. The healthy development of our children is determined by the supply of healthy foods, such as local milk products. That is why it is most important to promote milk and all the various milk products, from yoghurts to soft drinks and low-fat products, which children and schoolchildren love so much.
One reason why it is important to promote sales of milk and milk products is that it is becoming increasingly clear that unhealthy eating is leading to a growing number of health problems among Europeans too. The advertising budget contained in the mini milk package will increase people's awareness, which will in turn benefit the population as a whole.
It is vital to ensure that the savings resulting from the reform remain within the milk sector. In conclusion, let me say that direct production prices for farmers are finally rising, although this is certainly not due to the fact that we are now producing bio-energy but is mainly the result of environmental disasters and better markets within the EU and outside it, i.e. in third countries.
Bernadette Bourzai
(FR) Mr President, Commissioner, ladies and gentlemen, I should first like to congratulate Mrs Jeggle on her excellent work. I particularly support her objections to the abolition of private storage aid for cream and skimmed milk powder and the wish to introduce a single rate of aid for milk distributed in schools.
However, along with some of my colleagues, I should like in particular to mention the current milk shortage, which is undoubtedly due not just to an increase in worldwide demand but also to a reduction in supply which could have been anticipated because it was, in my view, foreseeable. Due to the reform of the CAP and the fall in the price paid to milk producers, some farmers, such as those in France, have got rid of some of their dairy cows and are focusing more on beef and veal or, in Germany for instance, have given up rearing cattle altogether and are growing cereals instead. As a result, France has 100 000 fewer dairy cows than it needs to fill its quota and the European Union needs one billion litres of milk to meet European demand. That shortage is already having and will continue to have serious effects on the prices of milk and hence milk products, as well as on the prices of various other food products. In addition to those increases, the price of other basic foodstuffs such as cereals and meat will rise as a result of the rising prices of animal feed. Obviously that is going to cause extra difficulties for consumers.
It therefore seems to me necessary to introduce price stabilisation instruments. In particular, there is a need to build up further stocks as soon as possible to make the market more secure; increase the milk price paid to producers to encourage them to continue and increase production and help them cope with the rise in animal feed prices; provide more support for marketing and distribution channels; increase European milk production quotas as quickly as possible; and evaluate the CMO for milk in the 2008 review of the CAP, in the light of the current shortage and before any consideration is given to abolishing milk quotas in 2015.
Finally, I should like to draw attention to the even more difficult situation of milk producers in mountain areas, the producers I represent. Their production costs are higher and supplies are more difficult. What is more, in some countries such as France they are faced with a reduction in the collection aid that offset part of the extra cost of collection in mountain areas. Milk production is one of the sectors that make the biggest contribution to land conservation and land use planning, especially in problem areas. I hope, therefore, that proper consideration will be given to the specific problems of the mountain areas in any future debates on the CAP review and the new CAP.
Jorgo Chatzimarkakis
(DE) Mr President, Commissioner, 'milk is good for you' and today everyone is talking about it. Milk is the oldest energy drink in the world, it is a particularly important product, and it is good that we are debating it today. What we call the mini milk package, made up of three documents, is only one, albeit very important, building block in the further simplification of EU legislation in agriculture, and in principle the Commission's reform and simplification measures in this connection are most welcome.
As we know, reforming the Common Agricultural Policy is a long-term, continuous process and the proposed mini milk package is a step in the right reform direction. Rome was not built in a day, however. The Commissioner knows that better than anyone.
I would like to address an important political aspect that some colleagues have already discussed: school milk. Here the Committee on Agriculture and Rural Development has called for an increase from EUR 16.11 to EUR 18.11 per 100 kg. That is a sensible correction and we were right to call for it. Perhaps we could now seriously consider a school fruit programme, which would probably also please the Commissioner's colleague, Mr Kyprianou.
I also welcome the standardisation of the protein content of milk and milk production because it allows European producers to enter into fair competition with their third-country competitors, given that competition is a basic liberal concern. At the same time it is right, important and also urgently necessary for milk producers and dairies to pool their resources even more, so that it becomes even easier for them to assert their interests on the market. A good deal of work on the ground is still required here too.
Let me put forward an idea from the consumers' point of view, and looking towards the future. The demand for milk has risen worldwide. It is particularly clear that living and eating habits are changing in Asia as a whole, i.e. demand is rising and prices are rising. It is a pity that the higher prices are attributable above all to trade. Yet we must also be honest with our citizens. To some extent the higher prices tell the environmental truth. For instance, it is not comprehensible that a litre of milk now costs less than a litre of water. Butter is cheaper now than it was 20 years ago. We certainly must tell the citizens that there are of course also some improvements. The money should remain in the sector, however, and not go to trade.
A word on the quota. Evidently we will still have the quota for some time. That has been debated here and the reasons for having that quota have been given. Yet the current milk quota must expire in March 2015, and not just for German farmers who could then profit from the rising global demand for milk and products. What the Commissioner said when she was thinking out loud of considering actually raising the quota could be taken to mean it needs removing. We should be honest here and call for its removal.
I thank Mrs Jeggle for what was, on the whole, a very good report. I wish the Commissioner all the best on the way to further reforms of the agricultural policy.
Andrzej Tomasz Zapałowski
(PL) Mr President, the proposed changes to the milk market and the creation of a milk fund are meant to provide support to farmers and consumers, not to damage the existing situation. There is no doubt that provision must be made for exceptional circumstances and a legal basis guaranteed for the storage of milk products in different conditions.
A particularly important part of the battle for healthy food is to provide support for agricultural production in mountainous areas. Good quality milk is produced there because of the relatively low levels of pollution.
It is equally important to give the public accurate information about the product, i.e. milk, as well as about the country and producer responsible for its manufacture. This should include information that genetically modified plants were or were not used during its production. This is particularly important when giving milk to children.
Finally I would like to congratulate Mrs Jeggle on her excellent report.
Jim Allister
Mr President, there are three points in the report on the common organisation of the market in milk which I strongly support. One: private storage of cream and skimmed milk powder should not be abolished, but retained as a safety net in the volatile world of milk production. Two: the school milk scheme is of critical importance, not least in the fight against obesity, and it should be widened to include new and healthy dairy products. Three: a milk fund restructuring programme should be set up for the purpose of retaining for the milk sector savings resulting from the implementation of the mini-milk package, with such a fund being used for marketing support and nutrition awareness.
Though, at present, the outlook on milk is more optimistic, we need to be sure that no steps are taken that would remove the current safety nets or fail to expand the vision for milk. Nor should savings made be lost to the industry and its promotion.
Esther de Lange
(NL) Mr President, this late in the day, when only our dogged spokesmen on agriculture and the agriculture Commissioner are still with us - for which my thanks, Commissioner - milk may not be the most obvious refreshment we are thirsty for, especially after the previous debate. But we must not forget that we are talking here about one of the giants of European agricultural production. Every Member State of the EU is a dairy producer and dairy accounts for no less than 14% of Europe's agricultural output. Notwithstanding its relatively modest share of the farm budget, it must be said. The dairy sector also offers us quality products and a choice of regional specialities. General De Gaulle made a connection between this great diversity of products and his country's governability. 'How can you govern a country which has 246 kinds of cheese?' he asked rhetorically. What this French observation might mean for a European Union of 27 Member States and no doubt thousands of kinds of cheese, well, we won't go into that this evening.
We must not forget the contribution which dairy farmers make to our countryside. A sector to be proud of, then, but one which has not had an easy time of it in recent years. It is tempting, in the light of those difficult years and present-day market developments, to dwell on questions which go beyond the scope of this debate. I shall be the exception to the rule and will not do that, though most Members have given in to the temptation. I will merely echo Struan Stevenson, who quite properly asks how much of the price rise actually feeds through to the farmers.
Back then to the subject of our debate: Mrs Jeggle's most excellent reports. I specifically want to address the call to widen the school milk scheme. The link between fat percentage and support has rightly been scrapped, so to me it makes sense, in widening the scheme, to think above all about innovative and healthy products, especially in view of Europe's growing obesity problem. The Commissioner has already said that she is having talks on this with the Member States, but maybe she can tell us when we can expect concrete proposals on the subject and consequently when this package is actually likely to be expanded.
Lastly, I agree with the rapporteur that it is too soon to do away with existing safety nets altogether, even if they are not currently used, but that this too is a matter for the Health Check. 'To be continued', is the message, then.
Csaba Sándor Tabajdi
(HU) I warmly compliment Mrs Jeggle on her outstanding work and would also like to welcome the Commission's mini milk package. In the new Member States it has so far been possible to deviate from the EU regulations on fat content, due to the hard-won derogations, but it is good news that after 2009 we will still be able to consume the milk products to which we are well accustomed.
With the anticipated intensification of trade between the Member States as a result of liberalisation, we have to be ever more alert to the issue of food safety. I would like to draw the Commissioner's attention to the fact that food safety poses an ever greater problem throughout the whole of Europe, and one which is particularly pertinent to the new Member States.
I support the proposal adopted by the Committee on Agriculture that the budget savings from standardisation must remain within the milk sector. This money must be devoted to two aims. One is the reorganisation of the milk support and the other is the school milk programme which is an excellent initiative by the Commission. The programme is one of the fundamental elements of healthy nutrition in the fight against obesity and weight gain. Support for this programme must be increased.
I would like to point out to Mr Chatzimarkakis that he is knocking at an open door, since eighteen months ago I proposed a school fruit programme which Mrs Fischer Boel accepted to such an extent that it now forms part of the already completed fruit and vegetable reform. The school milk programme and the school fruit programme complement each other very well.
Many people have mentioned the quota system. It is both evident and to be feared that the Commission will scrap it but nonetheless I would ask that what happened with the maize intervention should not be repeated. Let there be a 'soft landing', let there be a preparatory period for the milk producers. I am afraid that the increase in the national quota and the abolition of fines will lead to the devaluation of quotas in the years that follow.
Zdzisław Zbigniew Podkański
(PL) Mr President, the common organisation of the market for milk and milk products is an important issue both for individual Member States and for the entire European Union. We are all agreed that it requires certain changes, but these should be based on the results of thorough research, and not on industry or trade lobbying. We must remember that our objective should always be the good of humanity and in this case that of consumers, who have the right to expect us to protect their interests.
In this context the proposal from the European Commission to abolish the tolerance of plus or minus 0.2% for the fat content in milk for human consumption in relation to the value given on the packaging is unacceptable. Improvements to the organisation of the milk market should begin with a review of milk quotas and then allocate them on the basis of consumption. We cannot have a situation where, for example, Germany, with 80 million inhabitants, has a milk quota of over 28 600 000 tonnes, whereas Poland, with 38 million inhabitants, has less than 9 million tonnes.
The Common Agricultural Policy, including the milk policy, also needs questions to be asked such as: what model of agriculture are we supporting - is it family agricultural holdings, or farmers with thousands or tens of thousands of hectares? If it is to be the family holdings, which are the ones I am considering, then there is no need to finance private storage on the farms. These funds would be better used for the proposed milk fund, which would serve, among other things, to disseminate information on nourishment from milk and milk products, to support the 'school milk' scheme, to provide support for the production of regional products and for restructuring the milk industry.
Mairead McGuinness
President, I too should like to congratulate Mrs Jeggle on her expertise in handling these reports. It makes sense to simplify but not to radically change at this stage.
I suppose it is a funny old world, because not that long ago, it was doom and gloom in the dairy sector and it is incredible how buoyant and resilient farmers are that this summer, for the first time in a long time, I saw smiles on their faces because milk prices are recovering. Consumers are noticing - and Tesco is actually saying - that the long-term trend of declining spend on food has stopped. Sir Terry Leahy, Tesco's chief executive, recently said that there is a fundamental shift in the priority consumers place on food and I think that is true, and it is welcome, and I hope it signifies a move away from the 'slash and burn' policy of supermarkets in relation to food. Obviously we are trying to be specific in relation to milk. All of us want to know what your plans are on milk quotas, given the market situation we now face. And we look forward to hearing that.
I read too that China is anxious for its children to be able to have access to milk and it is extraordinary that with that in mind, our children in Europe are apparently drinking less and less of it. However, in relation to the school milk scheme, which is vital, can I just give you the views of Áine - who happens to be one of my own and who is aged ten. She has just opted out of the school milk scheme and I think it is interesting why she has done that - she actually loves milk - but she would rather be outside playing with her friends than sitting drinking milk, which she is forced to do within the school. So there are lots of reasons why this scheme might need to be looked at and we need to work with the schools, because average milk consumption in Ireland is low and we are worried about it in terms of the fight against obesity.
As I say, I look forward to the future and the health check. My own health at the moment is a little bit dodgy and I think that a hot cup of milk for those of us who wait until this long hour would have been most welcome!
Wiesław Stefan Kuc
(PL) Mr President, Mrs Jeggle's reports make a start on the reform of the market for milk and milk products. It is good that the proposal for and creation of a milk fund come before specific actions to reform the milk producers' and processors' sector. It is also good that some flexibility is being introduced, with the reduction in the number of regulations affecting the EU organisation of the market for milk and milk products.
What is not good is that this flexibility did not go further and that milk quotas, i.e. hands-on control over production quantities, have not been abandoned. It is also not good that standardisation in the form of the consolidation of protein and fat content has remained, since, unlike the situation with meat production, it separates the quality of the product from the producer.
Finally, on behalf of producers, processors and all of us, I hope that this reform achieves more of the objectives set for it than the last one.
Carmen Fraga Estévez
(ES) Mr President, first of all I would like to congratulate Mrs Jeggle on her reports which have gone into the Commission proposals in detail and improved them, and I only hope that the technical agreement reached in the special agriculture committee does not prevent the Council from considering the amendments adopted by Parliament, such as the amendment on the non-abolition of aid to private storage.
Furthermore I would like to stress that this package of proposals contains significant elements which herald the start of an intermediate stage leading to the abolition, in principle by the year 2015, of the quota system. I refer by way of illustration to decreasing the intervention price for skimmed milk powder.
The announcement that milk quotas are to disappear has by itself created a situation of uncertainty among producers, as the Commissioner is well aware, and the quota market has been crippled as a result, making for a significant slowdown in the restructuring required in the sector, at least in Spain.
On those grounds we are asking the Commission not to delay in presenting proposals on the future of the sector which reply to questions such as the rate of gradual increase in quotas or possible compensation for loss of production rights, or the level of direct aid following the new fall in intervention prices; these questions among others require an urgent response so that the sector can be brought out of this uncertain situation.
Czesław Adam Siekierski
(PL) Mr President, Commissioner, we are discussing the mini-package of reforms to the market for milk and milk products. Mini-package is a good description for the proposed changes. A full and proper reform of this market is yet to come.
The proposals contained in the mini-package are sensible and deserve support. They are concerned with the creation of a milk fund that will support reforming activities in this sector, such as the promotion of milk consumption, including consumption in schools, or support for milk production in mountainous areas. Support for private storage of milk products should also be maintained.
But there is a fundamental question: what about the major reforms of the milk market? We see at present that prices of milk products are increasing, which will fuel inflation throughout the European Union. The requirement to export milk products from the EU is growing.
What is the situation within the EU? Production quotas and enormous fines for exceeding them. What should be done? Acting in a systematic but controlled way we should start to increase milk quotas by 2 to 5% per annum, depending on the situation in the country in question. Let us pave the way for the abolition of quotas by 2015 - this is what farmers are waiting for. The Commissioner has spoken about this on many occasions. Can we afford to wait for the Health Check? I do not think so. I believe we can start on the gradual process of increasing milk quotas from today. I repeat: slowly, gradually, and in a fully monitored way.
Albert Deß
(DE) Mr President, Commissioner, ladies and gentlemen, Mrs Jeggle has done an outstanding job with the three reports on milk, for which I give her warm thanks. I also thank the Commissioner for the proposals that form the basis of our discussion today. These three reports are of a rather technical nature. The crucial debate on milk will take place in connection with the Health Check.
I would like to address a few points. I am pleased that the first report is concerned with standardising the protein content of milk powder, which leads to market adjustment. In the second report, I find it welcome that the 27 national quality classes for butter are to be removed and replaced with a single, Europe-wide quality definition. I am also glad that more attention is being paid to the question of school milk. It is better to make milk and milk products tasty for our children than to have to discuss alcohol abuse among young people, as was the case today.
The third report indicates that drinking milk could be marketed more flexibly. Here I would insist to the Commissioner that the +/- 0.2% tolerance margin is far too high. Milk producers calculate the fat content of the milk they get from the farmers exactly to within 0.01%, so they must also be able to give consumers an exact indication of the fat content of drinking milk.
Milk is a valuable and healthy food. Milk and milk products form part of a healthy diet and I hope the upward trend continues for our dairy farmers and that the market grows. That is urgently necessary to ensure that our dairy farmers are rewarded better for working 365 days a year. The outcry about rising milk prices is not justified. Average consumption in Europe is 260 kg. If the consumer has to pay 10 cents more, that comes to 50 cents a week and surely we should consider milk production in Europe worth that much.
Monica Maria Iacob-Ridzi
(RO) Mr President, dear colleagues, the measure of simplifying the common milk market is, also from the Member States' perspective, a great initiative that brings the European Union closer to the farmers' real needs. This is possible especially by liberalizing production and milk marketing. This is good news especially for those countries whose farmers should make too large investments to produce just one of the 3 milk categories accepted until now.
I do not think that under the present market conditions farmers could have adapted their production by 2009, the end of the transition period. Moreover, the European Union does not have to dictate the contents of milk products, as long as the phytosanitary standards are complied with. That is why I totally agree with this liberalization measure.
Secondly, I support the introduction of one single rate of aid in the school-milk scheme. This is an important measure that will contribute to social cohesion in Europe as poorer regions will be favoured, and to the fight against obesity among young people. According to a Commission proposal, the aid should be higher because schools and kindergartens should not be forced to take part in financing a part of the cost. Moreover, this amount will be an advantage especially for those states which already have an aid system in schools. European funds can contribute to the quality of programmes and products provided to students and will remove significant budgetary resources of Member States, that could thus be used within the context of policies for young people.
I also support the creation of the European Fund for milk market restructuring. It should also include a financing line for improving quality, according to which many farmers in the new Member States cannot sell their production any more after 2009.
Least but not last, we have to see the changes in the common market organisation in the wider context of health control under the common agriculture policy. I think that this is the right time for restructuring the common milk market with the aim of removing the milk-quota system.
Mariann Fischer Boel
Member of the Commission. - Mr President, I wish to begin by thanking those of you who are still present for a constructive debate. As there do not seem to be major differences in our opinion on the milk mini-package, I would take the opportunity to use my final comments on the 'elephant in the room'.
In the last couple of weeks, various stakeholders and media have put particular focus on the development of dairy prices in the Community during the summer. I shall be more than happy to have this opportunity today to put things straight in order to avoid potential misunderstandings. It is a fact that prices for dairy products have gone up substantially since the beginning of the year, in particular as a response to the market and, as rightly mentioned, not as a response to the increased production of bio-energy.
Of course, there are some explanations for the increase in these prices, and I would like to come back to this a little later, but first I shall just put things into a more general perspective.
We all know that the proportion of the income spent by European households on food has been going down gradually, year after year. Today we are in a situation where the Community is spending only about 12% on food and non-alcoholic beverages - a dramatic decrease, as you can see from the money spent. It was very interesting to see that a German newspaper made a very quick study, concluding that in order to buy one litre of milk a person had to work for 11 minutes in 1960 and only 3 minutes in 2006. While the average price for butter today is EUR 4.10, it was EUR 4.50 in 1982. These prices are nominal prices and do not take inflation into account. The current prices are coming from a historical low level, which was established after the 2003 reform, which for the industry provided a stronger competitive basis and for the dairy farmers provided compensation for potentially lower prices.
Let me now come back to the fundamentals in the current market situation. First, most subsidies have been suspended for some time and these are mainly the export refunds, the intervention buying, the various different disposal aids.
Secondly, we are in a situation today where intervention stocks are empty - with all the quantities sold out into the internal market.
Thirdly, the supply of butter has been reduced due to the lower production and empty intervention stocks. Cheese production was a priority use for milk fat until recently, when the improved prices for butter have led the industry to expand butter production again.
Fourthly, although the cow's milk collected this year is slightly higher than last year, it does not fully meet the increase in demand.
I could continue naming other fundamentals, but basically we are today witnessing the play of market forces based on supply and demand. Gone is the pre-reform market attitude that the intervention level was the price leading. The industry is now taking genuine commercial decisions, providing maximum return for further investments, while also allowing higher prices to be paid to the dairy producers - the farmers.
In that context, I am pleased to see the positive development of raw milk prices during the last few months: 15-20% has been reported in some Member States. However, we all know that the cost of production has been going up and milk production will only continue to expand if the profit margin can be maintained or even increased.
Therefore, I would take this opportunity to draw a somewhat positive conclusion. In a historical perspective, the current wholesale and retail prices are not dramatically high. The return from the market for the dairy industry and for the farmers is encouraging, and the public market support spending in this sector is now more or less reduced to actions with some social character.
We should not let our policy decisions be dictated by short-term developments within the dairy sector, and throughout the next 12 months we will have an excellent opportunity to discuss ways and means to make the dairy sector move forward in a sustainable way.
We all know that the milk-quota system is due to end by 31 March 2015. As I have already mentioned, I will launch a debate in November on the 'Health Check', and following discussions - including here in Parliament - we will launch all the legal proposals during late spring 2008, so we can hopefully agree on the legislation to take place from 2009. In this context, we will take the opportunity to discuss in a broader context the whole dairy sector.
I will examine which measures could be appropriate to try to find a soft landing for the expiry of the quota system in 2015. A soft landing could be, as has already been mentioned, some sort of an increase of the quotas before or in the mid-term up until 2015. I am quite sure that we will have a huge opportunity to have some very interesting discussions, including as regards the dairy sector in a broader context, throughout the next 12 months.
President
The debate is closed.
The vote will take place tomorrow.
Written statements (Rule 142)
Bogdan Golik
in writing. - (SL) Mr President, the European Commission's proposal concerning a milk mini-package will definitely help to simplify the CAP and reduce the administrative burden. Most of the sections in this package deserve support, particularly as regards allowing the production and marketing within the Community of milk for human consumption with more graduation of fat content then was previously possible, as well as the introduction of a single rate of subsidy for milk distributed under the 'school milk' scheme.
However, the elimination of subsidies for the private storage of SMP and cream raises some questions. The view of the European Commission is that EU operators did not use these support instruments for the milk market and, for this reason, they should be considered to be obsolete and unnecessary. At present it is difficult to predict with any certainty the future of the market for milk and milk products over the longer term, especially as the Common Agricultural Policy is currently undergoing changes, and for this reason the elimination of the above support instruments, even though they are not currently being used, would appear to be somewhat rash.
Hélène Goudin  
in writing. - (SV) Many times in this Chamber the June List has had strong political objections to reports that have come from the Committee on Agriculture and Rural Development. The report on the common organisation of the market in milk and milk products is another report from that committee which stubbornly maintains continued protection of heavy subsidies for all the different groups in the agricultural sector and continued protectionism against the outside world.
