Sunday, April 29, 2007

Butter mountain finally melts



The satisfied look of this cow in the Azores is no great surprise as it receives one of the biggest cattle subsidies in the EU, although still not enough for Portugal who voted against the last CAP reform on the issue of the fate of dairy cows in the Atlantic islands.

After 39 years of a butter mountain under the CAP, it has finally melted away. When the Soviet Union still existed, stocks of 'ageing' butter used to be sold off to its consumers who were glad to get any butter at all.

The last remaining stocks (in the Czech Republic, Finland and Spain) have been sold off. High market prices have led the Commission to close intervention in Spain, so it only remains open in Portugal.

Stocks reached a peak in 1986 when stocks totalled no less than 1.283 million tonnes, but the imposition of milk quotas helped to curb the build up. The other form of intervention buying in the dairy market, that of skimmed milk powder, ended in 2006.

Dairy intervention arrangements could be abolished as part of the forthcoming Health Check review. Dairy farmers still receive support, however, even though they might like to pretend otherwise. The virtual cow that was launched at the end of the 1990s never made its way into legislation, but dairy farmers receive their payments in another form.

Oxfam has estimated that a dairy cow in the EU can receive a subsidy of as much as $2 a day. Even if this figure is exaggerated, it is more than many people live on in least developed countries.

2 Comments:

Anonymous rprice said...

Hi Wyn

This is a fascinating topic, I'm currently writing about it for a course work assignment as part of an MBA with the Imperial College, London. I am desperately trying to track down a trustworthy source for information by year on the quantity of butter surplus for which the CAP was applied. Would you possibly be able to assist please?

Any thoughts on the correct location for this data to be sourced from would be gratefully received.

Many thanks.

Rebecca

8:53 AM  
Blogger Wyn Grant said...

I suggest you E mail me, go to Warwick University site to find address. Wyn

12:47 AM  

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