The European Commission unveiled a raft of proposals last week (15 February) which plan to set an EU-wide quality standard for butter, open school milk subsidies to semi and skimmed milk and scrap subsidies for private storage of cream and skimmed milk powder.

The Commission also wants to give dairy firms more freedom to choose the fat content of their milk and match EU rules on protein content for milk powder with international ones.

The plans, which are expected to be finalised within six months, are seen as the first stage of reforms across the EU ahead of the Commission’s CAP ‘health check’ in 2008.

Volatile

But, according to dairy consultant Mike Bessey, these mini reforms could leave the UK dairy industry in an unstable position.

“They are not good for dairy farmers. It is weakening the support given to the market and there is a possibility they will become more volatile,” he said.

“While the current reforms are not dramatic in effect, they are some smaller steps of the Commission removing intervention, getting out of management and handing control of the dairy markets back to the industry.

“Removing intervention could cut red tape and bureaucracy, but world production could go up, which could depress prices,” he added.

Sensible

Tom Hind, NFU chief dairy advisor, agreed the reforms were the start of greater reform in 2008, but said the Commission’s proposals were “quite sensible”.

“Processors say they want to choose fat percentages in milk, while we have been pushing for the protein content decision for a while,” he said.

“Overall it’s a thumbs up – it’s an appetiser for the main event in 2008 when the big debate will be about quotas.”

Milk Link also welcomed the new proposals. A spokesman said allowing processors to choice fat content would create new areas for innovation and development.

“But we have to be sure that in creating new products we don’t confuse consumers,” he warned.

TheCattleSite News Desk