18 September 1998
EU pressed to abolish milk quotas

THE UK, Italy, Sweden and Denmark are pressing for the abolition of European Union (EU) milk quotas from the beginning of the next decade.

The four countries say that a proposed lifting of the restriction by 2% is not enough. They want the quotas lifted by 4% in phases in anticipation of abolition in 2006.

The countries are also pressing for a 30% cut in guaranteed prices at which the EU buys dairy products if markets are weak. The Commission has proposed a 15% cut.

The suggestions by the four countries have come at a time when the EU is debating the reform of the common agricultural policy (CAP). EU plans are expected to be finalised by March of next year.

The Commission also wants reform of the other two main items of CAP expenditure, the beef and cereals sectors.

Germany, and also France, will be the strongest opponent of the changes in milk quotas proposed. The four countries suggest price cuts should be accompanied by payments to farmers.

They want the EUs intervention mechanism, whereby it guarantees to buy butter and milk if prices fall below a certain level, to be replaced by private storage. The EU would finance the temporary removal of produce from the market rather than purchase the products itself, under private storage.