September 3, 2010

EU offers $385 million to help ailing dairy sector

An emergency dairy fund to help struggling dairy farmers across Europe has been extended by EUR300 million (US$385 million).

The European Parliament's Agriculture Committee agreed to extend existing funding so it could continue to help the EU's dairy sector market and restructure the industry.

About EUR280 million (US$359 million) was previously set aside by the EU in 2009 to assist beleaguered dairy farmers.

The fund will also provide financial assistance for deprived areas and fund research into developing dairy products.

At a meeting on Tuesday (August 31), the Committee also voted for an increase in the EU school milk budget to EUR90 million (US$115 million).

It also agreed to continue funding the EU Farm Prices and Margins Observatory, which compiles data on the difference between what producers receive for produce and the amount consumers pay.

Scottish National Party MEP Alyn Smith, a member of the committee, said the fund remained a "useful tool" for dairy farmers, but warned that changes to the structure of the dairy industry were needed for a longer-term solution.

"If farmers are not making money from the market then there is no amount of other mechanisms that will encourage folk to stay in farming," he added.