EU hits back at US over dairy export subsidy move

The US should not use the EU's reinstatement of export subsidies as an excuse to go ahead in the same direction, according to EU Agriculture Commissioner Mariann Fischer Boel.

Fischer Boel said the EU did not introduce their export refunds until they had calculated the effect on the market, and they have not covered the gap between the EU and world prices.

Late last week, the USDA said it would subsidise about 92,000 tonnes of dairy exports to help US farmers hit by plummeting world prices and trade volumes, a move that the New Zealand dairy industry did not appreciate.

Fischer Boel said it is unfair that the EU has become the reason for the US to introduce export refunds.

In January, the EU reactivated its export subsidies for a series of dairy products to help its struggling exporters better compete on the depressed world market. The subsidies were suspended in June 2007 due to prolonged high prices.