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New Rules on Market Transparency in the Food supply chain

On September 11th, the European Council adopted new rules on price reporting in the food supply chain, designed to increase market and price transparency across different stages of the chain and improve the timeliness and accuracy of the data supplied by the existing European Market Observatories.

A key concern for ICOS in the initial proposal was the tightening of the deadline for the reporting of raw milk prices by processors, to that of the 15th of the month for the proceeding’s month supply, (up from the current deadline of the 25th of the month).   This tighter deadline would be unfeasible for Irish dairy co-operatives due to their price setting structures. However following engagement with EU and Irish officials on the issue, it was addressed within the final text. The deadline for notification of raw milk prices with therefore remain on the 25th of the month.

There are still concerns about the potential impact of the measures, particularly whether price reporting in the fresh product sector will negatively affect processors via a vis their negotiations with retailers. This is particularly relevant with regard to the price differences between branded drinking milk and private label drinking milk, which could lead to downward pressure on branded milk prices. Therefore, the close attention will be needed following the introduction of the measures from the 1st January 2021 to ensure the objective of the regulation, to improve the position of farmers in the food supply chain, is achieved and not hindered.

The new measures for the dairy sector include:

  • Notification of weekly selling prices: Currently dairy processors are required to notify the Commission of the selling price of whey, SMP, WMP, butter and commodity cheeses. Under the proposal the prices of cream, drinking milk and fat filled powders will also be required. Mozzarella prices will now too be required as part of commodity cheeses.
  • Notification of weekly buying prices: Representative retailers and other representative food business operators will be required to notify the Commission of the buying prices for butter and relevant cheeses.
  • Notification of monthly raw milk prices: Processors will now need to notify the Commission of the price of organic raw milk, in addition to the current notification of standard raw milk prices, by the 25th of each month for the proceeding months’ supply.
  • Notification of milk quantity and content: The proposal includes a new requirement for processors to notify the Commission of the quantity of organic milk produced (in addition to the existing requirements on total milk quantity produced) as well as the fat content and the protein content of raw milk as a percentage of the product weight. This will also need to be reported by the 25th of each month for the preceding month’s supply
  • Notification of Fat Filled Powder production: There is a new requirement for dairy processors to notify the Commission of the quantity of fat-filled powder produced, expressed in tonnes, by the 25th of each month for the preceding month’s production.
  • Method: This additional information will be made available by operators to the Commission via Member States authorities or directly (under the supervision of Member States) through an online system. It will be made available to the public through the existing EU Market Observatories. Member States can choose the most cost-effective approach for gathering this information and can choose to collect solely representative data as a means to alleviating the administrative burden on SME businesses.

Alison Graham, European Affairs Executive