European milk farmers protest low prices/subsidies

[SwordoftheVistula]

Article mainly posted for the hilarious picture...but if this is a chronic problem maybe that is a sign of overproduction, and that the least productive of the milk producers should be allowed to go out of business and find another line of work?

http://www.nytimes.com/2009/10/06/bu...milk.html?_r=2

BRUSSELS — After months of complaints by European dairy farmers angry over low prices, protesters in Brussels on Monday poured milk onto the streets, hurled eggs and other missiles, and started fires that filled the air with black smoke.

Police helicopters hovered overhead as hundreds of tractors — and some cattle — blockaded the area outside the European Union’s headquarters while agriculture ministers met in an emergency meeting.

The gathering of ministers, convened after pressure from France, failed to produce any breakthroughs apart from a decision to set up a committee to report on the dairy industry in June.

Monday’s protest was the latest by farmers who dumped around three million liters of milk on fields in Belgium last month.

“There’s a very serious crisis in the milk sector,” said the Swedish agriculture minister, Eskil Erlandsson, who headed Monday’s discussion. “We didn’t take any decisions today, but we identified areas where the future policy needs to concentrate on.”

The protest organizers, the European Milk Board, said that more than 1,000 tractors and 5,000 people took part on behalf of “more than 80,000 dairy farmers”.

The group said milk prices are below 75 percent of production costs. Another European farm union organization, Copa-Cogeca, says that milk prices have plummeted 30 percent in a year and that dairy producers will lose up to 14 billion euros before the end of the year if nothing is done.

The European Commission, however, said that the average milk price increased slightly in the last two months and that the price of butter and skimmed milk powder had risen 7 to 9 percent in three months.

The commission said it expected to spend up to 600 million euros supporting butter and skimmed milk prices this year and proposed to continue this policy throughout the winter.

In recent years the European Union has sought to reform its subsidy system and aims to phase out milk quotas, which limit production, by 2015.

Some 20 of the 27 countries in the European Union have called for changes that would give producers the ability to organize more effectively so as to increase their clout in dealing with supermarket chains and dairy companies.

Other critics want more export subsidies and some would like to keep the quotas — though that has been ruled out by the European Commission.

Harald von Witzke, professor of international agricultural trade and development at Humboldt University in Berlin, said the protests were the symptom of the pain caused by a gradual reform of rigid controls on the dairy sector.

“The system has postponed the pain being felt, but now the pain is even greater,” he said adding that making concessions to the farmers “would make matters worse in the long run.”

Unconfirmed reports state that in the future riot police will be issued gear more appropriate to the situation:


Pic courtesy of 'Geek' on the NeoGaf gaming forum

[Skandi]

It is more a case of supermarkets forcing the price down to impossible levels.

[SwordoftheVistula]

It is more a case of supermarkets forcing the price down to impossible levels.

Isn't that good for consumers, keeps the common person's food costs down? Anyways, once some of the milk producers went out of business, the supermarkets would probably be forced to offer up more money to ensure a continuing supply of milk.

[Treffie]

Isn't that good for consumers, keeps the common person's food costs down? Anyways, once some of the milk producers went out of business, the supermarkets would probably be forced to offer up more money to ensure a continuing supply of milk.

Good for consumers, but terrible for the dairy farmers. Most creameries where I live (which is mainly dairy and sheep farming) have closed and now only the big multinationals are producing the milk. Supermarkets keep telling us that they've struck a deal with the farmers so that they can have a good living, but the situation is as bad as ever. I'd rather pay 10p more for a pint of milk, knowing that the farmers' future in my area is secure.

[Skandi]

As to overproduction the UK overproduced it's EU quota by 0.66% last year.

The supermarkets are buying milk at less than the cost to produce, and there is nowhere else for the farmers to sell too. If you push for higher production you increase the number of hormones and antibiotics used and you also have to bring the cows in and intensively farm them.

What I think should happen is that the government should set a minimum price that can be paid wholesale, it would only up the price by a couple of pence a pint, I think the consumers can manage that.

The farmer received on average 23p/litre in August of this year. Whereas the cost of production is just under 27p/l interestingly Tesco is the best of the supermarkets, paying 27p/l When we buy milk from them it costs us about 88p

Back in 1995 the average selling price was 42.1ppl with the retailer taking a margin of 1.3p, the processor 16.3p while the farmer was paid 24.5p. Last year (2006) the retail price had risen to 51.6p, the retailers' margin had been hiked to a massive 15.6p

I doubt that has gone down any but the farmers margin certainly has.

[Svarog]

Yeah, it is horrible, here they refused to sell milk for such low prices and spilled it on the floor saying they're rather gonna do that then sell for these kind of prices and quite frankly i am on their side, town cannot function without a village, if people in villages cannot make for the living they are gonna move into the towns as they already are doing in big numbers, if there is no one to produce food - not only milk, similar situation with grain too - we'll be forced to import it from the other countries and everyone is on the loss, customers for paying triple for imported goods, producers for not only producing and making money but also for buying goods they'd usually produce on track and country for importing the goods instead of using it's own goods, the only one who'd be winning would be export-import companies which i already dislike enough as it is kind of a mafia business, this is shameful - to throw food - that is the biggest luxury one can afford

[Lahtari]

Article mainly posted for the hilarious picture...but if this is a chronic problem maybe that is a sign of overproduction, and that the least productive of the milk producers should be allowed to go out of business and find another line of work?

Yes. The majority of EU budget is used on farmer subsidies. We need to decrease our food production closer to the level of the market demand, and rather sooner than later. The surplus farmers could as well be hired as work inspectors in the Soviet style - there would be no difference. So let them pour all the milk and make noise all they want.

European people need to learn to be more vigilant about their tax money. A counter-demonstration would be in order. "Stop pouring my money"

It is more a case of supermarkets forcing the price down to impossible levels.

And why is it possible? The supermarkets need to buy milk from somewhere, so are they able to buy cheaper from abroad or is there an overproduction?

[Skandi]

And why is it possible? The supermarkets need to buy milk from somewhere, so are they able to buy cheaper from abroad or is there an overproduction?

Sorry I don't get the question, we don't produce too much no. but there is only one buyer and therefore no competition Farmers are left with a choice between a small loss and a large loss not much of a choice really. I don't think much milk is imported, the economics wouldn't be good.

[Lahtari]

Sorry I don't get the question, we don't produce too much no. but there is only one buyer and therefore no competition Farmers are left with a choice between a small loss and a large loss not much of a choice really. I don't think much milk is imported, the economics wouldn't be good.

Don't the farmers have any union to negotiate with it, and tell it that "you can't get any milk unless you pay a decent price?" Because if they need the milk, they will pay more than producing costs unless they can get cheaper from abroad.

[Skandi]

Don't the farmers have any union to negotiate with it, and tell it that "you can't get any milk unless you pay a decent price?" Because if they need the milk, they will pay more than producing costs unless they can get cheaper from abroad.

They do but it has no teeth. that is what they should do yes, but somehow it doesn't happen, interestingly this year they are getting 5p/l less than they were this time last year. And I think that the demand fro milk is going up.
One of our neighbouring farmers was phoned by a supermarket and offered a set price per cob of corn, if he could harvest it in two days, he said yes called in some favours and worked round the clock, they then said they didn't want it as they had got it cheaper else where, but he will still have to sell to them next year, as there is no viable option.