Don’t let it be a case of ‘too little, too late’ in months to come

ICOS today made a submission to the Department of Agriculture outlining its concerns regarding the proposed PSA Schemes for butter, SMP and cheese, announced yesterday by the European Commission.

ICOS said the Commission needs to ‘wake up’ to the potentially very serious impending damage that could be wrought on the entire EU dairy sector and not be caught in a position in months to come where it has done ‘too little, too late’.

The regulations are currently under review by EU member states and ICOS has used this opportunity to make a submission to the DAFM, highlighting a number of pressing concerns in the draft texts before the publication of the legislation.

In particular, ICOS has drawn attention to the inadequate proposal for fixed storage aid rates for butter and SMP, which have been halved in comparison to 2014 levels, despite the substantial increase in the cost of storage since then, with prices in particular reaching new levels in the last number of months since the outbreak of COVID-19.

The issue of adequate funding for these PSA schemes was raised by ICOS President Jerry Long during an online meeting yesterday with EU Agriculture Commissioner, Janusz Wojciechowski. ICOS is seeking for these support levels, for SMP and butter, to be raised, to ensure the scheme provides some level of meaningful support and for the support to be targeted where it is most needed. 

In addition, ICOS has criticised the unfair allocation of just 2.1% of the cheese storage quota to Ireland. Ireland produces 5% of EU cheese and therefore at a minimum we should be awarded 5% of the quota.

Furthermore, ICOS has highlighted that the allocation of the cheese quota by the European Commission on the basis of total cheese production unfairly penalises Ireland. Up to 50% of EU cheese production is fresh cheese, which is not suitable for storage. Including these cheese volumes in the calculation of national allocations provides certain EU countries with a disproportionally large allocation in comparison with their production of eligible cheese types and leaves countries like Ireland, where our production of cheddar is very suited to storage, with a disproportionately low allocation. ICOS is therefore calling for an urgent review of Ireland’s cheese quota allocation in the proposed regulations on this basis.

Finally, it is a major disappointment to us that the draft regulations propose a very short time frame with an end date of 30th June. It is still very uncertain whether there will be any market improvements by this time, as we do not know when the food service industry, i.e. restaurants and catering services, will be back up and running. In addition, at that point Ireland will be just coming off our peak production and will still be producing, and therefore will likely need to store significant volumes of product. ICOS is therefore asking for an extension of the scheme until the end of September, so as much as possible of the current production season can be covered.