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Farming Milestone: Zero Dairy Subsidies; Plus Corn, China, More On The Cost Of Veal …

  • June 19th, 2007
  • Posted by EUEditor

catle-in-field-small.jpgThe level of export subsidies payable to farmers for all dairy products has been set at zero, not terminally scrapping the subsidies system just yet, but showing the direction that policy-makers now want.

The European Commission said the decision (on 14.6.07) was taken partly because of changes in the Common Agricultural Policy (CAP), quickly moving it away from production – related subsidies towards direct, single payments.

It was also due to much higher prices being obtained both on internal retail markets and on world markets.

Four years ago refunds to farmers for butter and cheese respectively were €170 per 100 kg and €105, with payments also for milk powder.

Market trends have lifted prices above the level where intervention, i.e. start of payment, would take place. For example cheese prices have been approaching $US 400 / 100 kg, with similar historically high levels for the other products as well.


Agriculture Ministers had also (11.6.07) agreed to the phasing out of public intervention purchases for maize.

This will take place over three years beginning in the second half of 2007.

Purchases will be limited initially to 1.5-million tonnes, moving to zero.

Spokespersons for the European Commission said stockpiling of maize had spiralled to a total of 5.6 million tonnes – becoming reminiscent of the days of butter mountains or a milk lake.

They currently make up 40% of total cereal stocks, and according to the EC, possible outlets for maize are limited, while it is also unsuitable for long-term storage.

Countries which traditionally grew the product for world markets have taken up offering it for intervention in more recent years, and so obtaining better prices.


The Trade Commissioner Peter Mandelson has had another go at obtaining better access for the EU to markets in China.

He met the Chinese Commerce Minister, Bo Xilai at Brussels on 12.6.07 for annual Ministerial trade consultations.

The European compliant is that business practices in China still impose obstacles to entry by the Europeans, despite the country having signed up to more open trade when it joined the WTO (World Trade Organisation).

The EU is also demanding much better protection for intellectual property, to end theft by copying of brands and designs.

Trade in expanding rapidly between China and Europe; Europe is now China’s largest trading partner and China has become Europe’s largest source of manufactured imports.


EUAustralia has checked for comparison last week’s report about regulating the quality of veal and veal price (New Rule To Settle Tender Feelings, EUAustralia 13.6.07), by going shopping down under.

Comparisons between supermarket prices in Brussels (and Brisbane), but assuming the same quality, in A$ equivalents:


Most expensive: Brussels fillet pur de veau A$51.74 k.g.; (Brisbane scotch fillet steak A$ 27.99).

Veal roast A$ 33.84; (blade roast A$12.99, rack roast A$19.99).

Steaks A$31-36.60; (A$22.99).

Cheapest in the shop: Shanks A$28.38; (casserole steak A$12.99).


Pork chops A$11-14.23; (A$8.99 – 11.98).