More emergency EU cash could be on its way to help milk producers and others cope with the market downturn.
A package of measures is being worked on and is expected to be put forward by farm commissioner Phil Hogan on 18 July.
However the new milk market terms could be linked to supply controls, he warned.
Milk collections had risen 5.6% in the first four months of 2016 compared with the same period last year, he told Monday’s (27 June) council of agriculture ministers’ meeting.
Martijn van Dam, Dutch minister for agriculture and president of the agriculture council, said that despite the September and March packages of measures, the crisis in the dairy, pigmeat and fruit and vegetables sectors continued, due to a persistent imbalance between supply and demand.
“The difficult situation is calling for additional measures as soon as possible, and we urged the commission to present an additional financial package in July 2016,” said Mr Van Dam after the council had met.
An earlier plan running for six months from 13 April allows voluntary supply management incentives by farmer co-ops and other groups but has attracted little interest.
New financial package
The NFU does not support measures linked to supply.
“We understand that commissioner Hogan will announce a new financial package at July council. We believe the way this is spent should be decided nationally rather than at an EU level and would not support it being linked to supply management at an EU scale,” said chief dairy adviser Siân Davies.
“Milk volumes have been falling in the UK since February with current daily deliveries down 6.1% on this time last year and 1.3% down on the three-year average.
“We believe there are more constructive ways of spending this funding and will discuss these with Defra and the commission.
“This includes support for more efficient, competitive dairy farming or support for the setting up of producer groups and producer organisations.
“We also understand that many EU member states are yet to pay out the EU support package allocated last autumn which is completely unacceptable when dairy farmers across the EU are suffering the impact of the market downturn.
“This money needs to be paid out quickly, simply and in a way that best supports farmers in the individual member states.”
Mr Hogan also called on the eight member states who have not done so to pay out their share of the earlier package of €420m (£350m) targeted aid before the 30 June deadline.
By the end of May, only 60% of the fund had been distributed – €222m (£185m) for the milk sector, €24m (£20m) for pigmeat and €4.6m (£3.8m) in beef aid.
At the council, agriculture ministers also agreed a further increase in the tonnage of skimmed milk powder which can be bought into intervention. The ceiling will be increased to 350,000t at a fixed price.