January 25, 2011

EU to prevent price slump by buying pork

The EU will start buying supplies of pork, to offset its price slumps after the dioxin scandal in Germany, the EU Commissioner for Agriculture, Dacian Ciolos, stated on Saturday (Jan 22) in Berlin.

Pork sales in Germany, the biggest market in Europe, dropped steeply after this month's Dioxin contamination alert. As a consequence, the price of Germany-produced pork dropped by 25%, up to EUR 1.12/kg (US$1.53/kg), when purchased from the producer.

"Brussels will offer incentives to farmers who stock on pork, in suitable storage conditions, to be sold when prices revert to normal values," Ciolos explained, adding that an official announcement to this effect would soon be made by the Commission.

It was also reported that the EU official promised that he would raise this issue in the Agriculture Ministers' Council, to take place today.

"The German government's measures have helped to restore confidence to the market," said Ciolos adding that Brussels would act if these proved inadequate.

The latest scandal was caused when a German firm supplied some 3,000 tonnes of fatty acids contaminated with cancer-causing dioxins to several animal feed makers.

Thousands of farms have been temporarily closed, and traces of dioxin have been found in eggs, poultry and pork. Several countries have since banned the import of German products.

Last Saturday the president of the German Farmers' Association (DVB), Gerd Sonnleitner, said the price producers get for pork had dropped from between EUR1.40-EUR1.50 (US$1.91-US$2.05) a kg down to EUR1.12 (US$1.53) a kg.

European agriculture ministers met on Monday (Jan 24) in Brussels to discuss the problem, with French minister Bruno Le Maire, also in Berlin, demanding immediate action.

French pig farmers were in an untenable situation, he said, calling for high-level discussions on the future of the industry, a move supported by Ciolos.