Abolish maize intervention, says EC

By staff reporter

- Last updated on GMT

Related tags Wheat Cereal Ec

The system of public intervention purchases for maize should be
abolished from the 2007/2008 marketing year, says the EC.

Otherwise, intervention stocks, which are bought and stored at public expense, are forecast to rise to as much as 15.6 million tonnes by 2013.

The EU intervention system for cereals is a single price of €101.31 per tonne which farmers receive for selling their cereals into public storage, if they cannot find an outlet on the market.

It is currently applicable to bread making wheat, durum wheat, barley, maize and sorghum.

But possible outlets for soaring stocks of maize are limited, and maize is unsuitable for long-term storage.

Furthermore, ending intervention for maize would allow the EU cereals market to achieve a new balance and see intervention regain its original purpose as a safety net.

The EC's proposal will now be transmitted to the Council and the European Parliament.

"Farmers should base their decisions on market signals rather than simply growing cereals for public purchase,"​ said Mariann Fischer Boel, commissioner for agriculture and rural development.

"That is the whole basis of the reforms we have been carrying out since 2003. Unless we make this change, public stocks will continue to rise and many farmers will simply continue to grow maize for sale into public storage.

"The experience with rye shows that the removal of intervention for this cereal in 2003 resulted in a more dynamic market and better prices for farmers. Even with this change for maize, cereals growers will continue to benefit from intervention operating as a safety net for other major cereals like wheat and barley."

The EC believes that this proposal will enhance the integration of the EU cereals market. It will help maize grown in surplus Central European regions to regain its competitiveness, both domestically and on world markets and will also help boost the competitiveness of pig and poultry production in these regions by reducing the cost of feedstuffs.

Furthermore, while the status quo would keep the annual level of expenditure on storing excess cereals at more than €300 million, the EC said that ending maize intervention would entail global savings of €617.8 million over the period 2008-2014.

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