Seymour Crawford (Cavan-Monaghan, Fine Gael)
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Question 482: To ask the Minister for Agriculture and Food the situation regarding negotiations on the future of milk quotas at Irish and European level; if she will advise a young farmer if there is any justification in them buying such quota if available; the length of time she expects the quotas to last; and if she will make a statement on the matter. [31864/06]

Mary Coughlan (Donegal South West, Fianna Fail)
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As the Deputy will be aware the current milk quota arrangements were extended until the end of the 2014/15 milk quota year as part of the 2003 Luxembourg Agreement on the reform of the CAP. While a review will take place in 2008, any further proposals for reform are a matter for the EU Commission, while the Council will make decisions on such proposals. Should the Commission come forward with further proposals in the milk sector I will participate fully in the Council to ensure that the best interests of the Irish dairy sector are protected.

At national level my focus is on the need to secure greater levels of efficiency at both producer and processor level in the face of considerable future challenges on international dairy markets. I recently announced the establishment of a new Milk Quota Trading System to supersede the Milk Quota Restructuring Scheme. The new system, which was agreed following extensive consultation with the farm organisations and ICOS, will release larger quantities of quota to active and committed dairy farmers through the combined operation of a market exchange and a maximum price priority pool.

The detailed rules for the new system will be available shortly, and milk producers will be invited to submit applications to sell or purchase quota by 24th November 2006, with the first exchange being run as soon as possible thereafter. The operation of the system will be reviewed after the first exchange, and a second exchange will follow in spring of 2007. These arrangements will allow milk producers the opportunity to bid for the amount of quota required to meet the development needs of their farm enterprise at a price that will generate a commercial rate of return. Given the different levels of efficiency at farm level, such decisions are best made by individual farmers.