Johnny Brady (Meath West, Fianna Fail)
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Question 23: To ask the Minister for Agriculture, Fisheries and Food if he is satisfied with the outcome of the EU Agriculture Council in relation to the dairy sector; and if he will make a statement on the matter. [43443/09]

Johnny Brady (Meath West, Fianna Fail)
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Question 51: To ask the Minister for Agriculture, Fisheries and Food if the recent package of measures, agreed at the EU Agriculture Council, will be sufficient to bring stability to the dairy sector; and if he will make a statement on the matter. [43444/09]

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I propose to take Questions Nos. 23 and 51 together.

The dairy market situation has been discussed at Council of Ministers meetings every month since March this year. At those meetings I have, together with my Ministerial colleagues, continually pressed the Commission to take all appropriate measures to deal with the situation, and those actions have helped to stabilise the market. The measures taken this year include the restoration of export refunds for dairy products and they were subsequently increased during the year. Prices on dairy markets have risen in recent weeks and there are signs of recovery and for that reason the Commission decided to reduce export refunds in the past month. I disagree with that approach, as the market remains volatile and reducing refunds prematurely could delay a lasting recovery.

Other measures taken include the continuation of Intervention for butter and skimmed milk powder beyond the mandatory fixed limits. In July Council agreed to implement a special measure to extend Intervention beyond August, to February 2010, and to 2011 if necessary. That provision was formally adopted at the October Council. I also welcomed the commitment given by Commissioner Fischer Boel in October to manage the release of stocks from Intervention in a prudent manner. We are seeing some tentative signs of an improvement in dairy markets, though a solid recovery is still uncertain and it is crucial that the disposal of stocks from intervention is handled in a sensitive manner and in a way that does not undermine the market at this critical time. At the Council meeting in September the Commissioner presented the dairy market report, which set out some options for the sector. At that meeting, I joined with Ministers from most other Member States in seeking major improvements in support for hard pressed dairy farmers. We signed a statement calling for a comprehensive EU approach that would combine immediate short-term measures along with a medium term strategy to deal with volatility in the milk sector. Following on from that, I attended a special Council meeting to look at medium to long term measures for the dairy sector. At that meeting it was agreed to set up a High Level Group of Member States, chaired by the Commission's Agriculture Director General, to examine the type of arrangements to be put in place.

The Commission High level Group will examine medium term and long term ways of stabilising dairy farmer's incomes and improving market transparency. The Group is tasked with delivering a comprehensive report by June 2010. It will examine means through which contractual arrangements in the supply chain can contribute to the highest possible returns for producers. This would give them more bargaining power in the process and provide a buffer against extremes of market volatility such as those that are being experienced at present. The Group will also examine existing market instruments and consider what other means, including a dairy futures market, could contribute to the objective of price stability in the longer term.

At the November Council last week approval was given for some short term measures to be implemented to assist the dairy sector. The main change is the extension of the Commission's emergency powers to cover the dairy sector. Under this provision the Commission will make available an additional €300 million for the dairy sector in the 2010 budget. The other change provides Member States with a new option for implementing a quota buying-up scheme for the quota years 2009/10 and 2010/11. For my part I will continue to maintain close contact with the EU Commission and the Council to ensure that support measures are activated at levels that will make a real impact in the market.