European Parliament - Konstantinos Papadakis’s Question & Answer: Harsh measures affecting poorer medium-sized dairy farms

6 June 2016 - Konstantinos Papadakis – [E-004635-16] - Subject: Harsh measures affecting poorer medium-sized dairy farms:

The restructuring of the dairy sector under the CAP has led to a reduction in the number of small farms with only few cows, while the number of large farms has increased. The resulting increase in productivity has benefited monopolistic formations with over 70% of production and marketing activities in the hands of just six groups.

The major fall in milk prices paid by dairies has left smaller farmers unable even to recoup their production costs. Their situation has been dramatically worsened following measures adopted by the present Syriza-ANEL coalition government and its predecessors, such as deregulation of the shelf life of pasteurized milk, deployment of legislative safeguards from the OECD ‘toolkit’ and production methods encouraging dairy processing monopolies.

In the meantime, poorer medium-sized sheep and goat milk producers are being ruined by extortionate taxes, animal diseases, the declassification of millions of acres of pastureland and the privatisation of public veterinary services.

In addition, under the terms of international agreements (CETA, TTIP, EPA agreement with South Africa regarding Feta cheese) the EU is effectively compromising Greek products (cheese, yogurt, oil, Kalamata olives etc.) hitherto protected by PDO and PGI rules.

In view of this:

What is the Commission’s response to the fact that, as a result of its measures, the concentration of dairy production in large capitalist farms is being encouraged while poorer medium-sized goat and sheep breeders are being progressively forced out of business?

Answer given by Mr Hogan on behalf of the Commission (28 July 2016):

«The Commission has mobilised a wide range of instruments to directly and indirectly support European farmers in difficulty, notably in the light of the introduction of the Russian ban in August 2014, and the deterioration of global markets throughout 2015 and in the first half of 2016. The Commission remains attentive to market evolution and will make a responsible use of the instruments made available by the legislator, should this be required.

The quality and diversity of the Union's agricultural production is one of its important strengths giving a competitive advantage to its producers. The Commission therefore strongly advocates the EU quality schemes like geographical indications (GI) as they offer significant benefits for small and medium-sized producers in that they often get a better price for their products and hold a stronger position in the food chain. They also help producers to distinguish their products in the marketplace highlighting their authenticity and specific characteristics. Through international agreements, the EU secures protection for EU GIs where in many cases there was none before. These agreements have no impact on protection of EU GIs within the EU.

Dairy GI products can serve as an important economic driver in the regions where they are produced as they usually generate direct jobs on the farms and in the processing facilities. EU quality schemes help more small production facilities to survive. Similarly, direct payments and rural development programmes offer appropriate tools to support smaller scale holdings notably located in less favoured areas.».