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Smith's Initiative to Encourage New Dairy Farmers

16 April 2009
Irish Department of Agriculture Fisheries and Food

IRELAND - The Minister for Agriculture, Fisheries and Food, Brendan Smith TD, today announced his plans for the allocation of the first of five annual increases of one per cent in milk quotas agreed under the so-called 'health check' of the CAP reform.

One quarter of the increase (approx. 13.5 million litres) will be set aside for a major new initiative aimed at attracting new entrants into milk production. The balance will be allocated as a 0.75 per cent increase in quota on a permanent, saleable basis for every producer active on 1 April 2009.

The Minister said: "I have listened carefully to the views expressed by farmers representatives in recent months on how to achieve the maximum benefit from the first one per cent increase in quotas. I am also mindful of the context in which this increase takes place. It follows a two per cent increase in April 2008, and is accompanied by the butterfat calculation adjustment that I secured last November which will deliver the equivalent of a further two per cent increase in quotas in 2009."

The Minister continued "I have decided that now is the time to make a bold move in support of new entrants to dairying. All in the sector are agreed that new entrants have a pivotal role to play in ensuring the future of the sector, and I am keen to build on the measures I implemented in 2008, including the opening up of participation in Milk Production Partnerships. I therefore intend that 25 per cent of the quota now being made available will be distributed to new entrants in a manner that will ensure that they can attain meaningful scale in a relatively short period of time."

The details of the scheme will be finalised and published in the coming weeks, but the Minister indicated that he envisages potential new entrants applying to his Department for participation in the scheme and, subject to compliance with various conditions, receiving an allocation of 200,000 litres of milk quota per applicant. Any surplus quota remaining after all applications are approved will be placed in the National Reserve and distributed to small and medium sized producers by the Milk Quota Appeals Tribunal. The scheme will operate on a pilot basis initially and will be reviewed after one year.

Concluding, the Minister said: "The extent of the quota increases in 2009 presents a real opportunity to allow new entrants to get a start in dairying on a scale that is immediately viable. I don't think we should let that opportunity pass. At the same time, my decision means that most active producers will, in any event, receive the equivalent of 2.75 per cent additional quota from 1 April 2009, which is just reward for the efforts they have made in developing their dairy enterprises."

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