Dairy processors in Northern Ireland are calling for the availability of open-ended intervention in the coming months to avoid further price pressure.
The request has been made by Dairy UK (NI) chairman Paul Vernon, who heads up the Glanbia cheese operation in the UK.
He confirmed that, under existing regulations, the European Commission would introduce an intervention tendering system once the current skimmed milk powder (SMP) intake threshold of 109,000 tonnes was reached.
Instead, Dairy UK wants the intervention clock set back to zero. Processors view intervention as a proven mechanism for tightening supplies and believe an early announcement to extend current intervention purchasing arrangements would help stabilise producer returns.
Dairy UK (NI) director Mike Johnston said the introduction of a tendering system would have only one consequence for dairy farmers, further pressure on milk prices.
“The current intervention measures are putting a floor in the market,” he said. “We believe the EU agriculture commissioner is fully aware of this fact and, moreover, he is sympathetic to our request.”
But Mr Johnston admitted the commissioner was not the sole arbiter when it came to amending the intervention arrangements.
“There are certain processes to be followed when it comes to securing changes of this nature,” he said.
“We estimate the SMP intervention threshold could be breached within the next few weeks. This is why we are calling for Commissioner [Phil] Hogan to take the required action now.
“We are anticipating the largest spring flush of milk Europe has ever had to deal with over the coming weeks. This is why full intervention support levels must be maintained throughout this critical period.”
Mr Johnston fully expected the dairy industry in the Republic of Ireland to back the calls made by Dairy UK for the maintenance of full intervention support levels.