The Commission has presented a report on the
development of the dairy market situation and the implementation of
the milk package.
The milk package is a set of legislative provisions,
contained in Regulation (EU) No 1308/2013 (the "CMO Regulation"),
in force since 3 October 2012 and which will continue to apply
until 30 June 2020.
The milk package includes mandatory contract
provisions that apply to all types of milk collection systems.
Provisions relating to producer organisations (POs) and collective
bargaining relate more to those Member States where cooperatives
are least developed.
1. Market situation: following an unstable period in global supply and
demand in the course of 2015 and in the first half of 2016, when
prices of EU dairy products reached their lowest levels, market
conditions for milk have improved since spring 2016. These
positive signs could translate into an increase in producer milk
prices from August 2016.
The medium-term outlook for the milk and dairy sector
is favourable. Global and national demand is expected to
continue to increase, allowing the EU dairy sector to improve its
position in world markets.
2. Implementation of the milk package:
the report finds that the main objective of the
milk package, namely to improve the position of milk producers in
the supply chain, has been partially met:
- Compulsory delivery contracts: these contracts cover 41% of EU milk deliveries
in 13 Member States, thus formalising the relations between
producers and processors in the Member States. Approximately 95% of
all milk deliveries from the EU are currently the subject of a
formal agreement in one form or another;
- Producer organisations (POs): at the end of 2015, 26 producer organisations (POs)
were recognised by 11 Member States, mostly in Germany,
France and Italy. About 60% of POs have confirmed that they have
succeeded in obtaining a more stable price for milk. The activities
of POs surveyed go beyond negotiating prices. They also
negotiate delivery volumes, delivery and payment terms, provide
value-added services in addition to milk supply, or support the
activities of producers: milk collection, information exchange,
quality control, technical or economic advice, etc;
- Collective bargaining: six Member States - mainly Germany, France and the
Czech Republic and, to a lesser extent, Spain, the United Kingdom
and Bulgaria - reported raw milk deliveries in 2014 and 2015 in the
context of collectively negotiated contracts. The volumes
collectively negotiated covered 25% of their total milk deliveries
in 2015, accounting for approximately 13% of total EU raw milk
deliveries, with no reported infringements of
competition;
- Regulation of supply for PDO/PGI
cheeses: the two Member States
that introduced it (Italy and France) gave a positive assessment as
regards the proper adjustment of supply to demand, price
stabilisation and protection of cheese production in disadvantaged
areas;
- Interbranch organisations: these contribute to greater transparency across the
supply chain and have proved their usefulness in a wide range of
activities such as defining standardised contracts, promotion and
providing technical advice;
- Compulsory declarations of milk
deliveries: this has secured a
rigorous volume information system, while improving significantly
the timeliness of the information.
3. Possible improvements: the Commission considers that actions of a
pedagogical, financial, or operational nature at EU and
Member State level could be envisaged to better exploit the
potential of two key instruments of the milk package, i.e. the
POs and collective negotiations:
- organisation of workshops involving Member States'
experts to share experiences and best practices in their
countries
- launch of campaigns to raise farmers' and processors'
awareness on the functioning and potential of POs;
- giving POs a priority status over individual
producers accessing aid schemes, in the form of premiums, or tax
advantages at national level;
- making additional financial support for POs
conditional to the achievement of collective negotiation objectives
as well as other joint activities that would help POs gain more
value;
- consider setting an obligation to farmers belonging to
a PO to deliver all their milk (or a minimum share) through their
PO;
- revision of the administrative conditions and
requirements for the recognition of POs so as to define reasonable
minimum sizes while avoiding discrimination among farmers in
different Member States due to current divergent
criteria;
- expanding the role of interbranch
organisations.
In view of this reports findings, the Commission
envisages extending the Milk Package beyond 2020 to allow its full
potential to materialise.