EU scraps meat export refunds

21-Jul-2013 - Last updated on 22-Jul-2013 at 09:12 GMT

The EU has scrapped poultry export refunds

Related tags European union Livestock Poultry

The European Union (EU) will scrap the last remaining export refund available for meat exporters, following a 20 year liberalisation process.

The EU’s Management Committee for the Common Organisation of Agricultural Markets: Animal Products has agreed to scrap refunds payable for exports of frozen whole chickens (65-70%) to certain destinations, notably in the Middle East and the Commonwealth of Independent States (ex-USSR countries). They fund the difference between global prices and EU prices, where EU prices are higher.

With exports refunds on the remaining pigmeat products being abolished last year, these poultry payments were the last of the subsidies.

A Brussels source told Globalmeatnews.com: “For the first time since they were introduced in the 1970s, no refunds will be applicable on EU exports from now on.” She noted that 20 years ago, EU spending on export refunds exceeded Euro EUR10bn a year. With the EU Common Agricultural Policy (CAP) becoming increasingly market oriented, these subsidies have dwindled, falling below EUR500m in 2010, with less than EUR100m budgeted this year.

EU member states benefiting from poultry refunds in 2012/13 were Bulgaria, Denmark, Germany, Spain, France, Italy, Lithuania, Hungary, the Netherlands, Poland, Portugal and Romania. France was the main beneficiary, supplying 94.7% of poultry exported with refunds, receiving 93.7% of the budget.

Globalmeatnews.com was told that several member states benefiting from this measure backed the European Commission’s proposal to fix the refunds at a zero rate (so formally keeping them in place), while others abstained.

Commission representatives at the meeting argued the refunds were unnecessary because of high available poultry prices, the foreseeable reduction in feed costs (notably soya, maize and wheat) and increasing EU exports.

Available refund rates for frozen chickens had already fallen from EUR32.50/100kg to EUR21.7/100kg last October (2012), and then to EUR10.85/100kg in January (2013). From July 1, 2012, to June 30, 2013, 264,754 tonnes of poultry meat were exported from the EU with refunds, on a EUR55.36m budget.

In the recently agreed reform of the CAP, it was agreed that export refunds would be used for market crises only.