Mary Coughlan (Donegal South West, Fianna Fail)

The milk quota trading scheme 2007-08, which supersedes the milk quota restructuring scheme, will have two application periods allowing for the exchange of milk quota with effect from 1 April 2007. The first application period closed last Friday, 24 November 2006 and I expect to announce details of the second application period early in the new year. The trading scheme has two elements, a priority pool and a market pool, the latter to function through an exchange mechanism. Some 70% of quota offered for sale will be sold though the exchange, and sellers will receive a market price for quota based on supply and demand. The remaining 30% will be sold at a maximum price of 12 cent per litre to priority categories, namely successors, dairy farmers whose leases have expired, young farmers and category 1 producers. This price of 12 cent per litre is the same as that available for the full amount of quota sold into this year's milk quota restructuring scheme.

My Department has commenced the process of validating applications to buy and sell quota with the co-ops. When this work is completed the exchange will be run in early January and the results will be communicated to applicants through the co-ops at that time.

As regards the future of milk quotas, the position is that the EU milk quota regime was extended to 2015 as part of the Luxembourg Agreement on the reform of the CAP. The Commission may bring forward proposals as part of the 2008 health check to modify that position, which in turn may require a Council decision. I will keep the position under close review and in the meantime I will continue to facilitate the transfer of milk quota to active and progressive dairy farmers.

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