The agreement would set a limit on maize intervention purchases of 1.5 million tons in the 2007-2008 season, 700,000 tons in 2008-2009 and then zero in 2009-2010, beginning on July 1, 2009. EU Agriculture and Rural Development Commissioner Mariann Fischer Boel welcomed the ministers’ decision although it fell short of European Commission expectations, the executive body of the EU.
„I’m delighted that the (Agriculture) council backed our plans to put an end to maize intervention,” she said in a statement. „The situation of growing stocks was rapidly becoming untenable – as well as expensive for the EU budget. Farmers should be growing for the market, not for intervention.” The decision was a compromise between a European Commission proposal and a European Parliament vote.
The European Commission proposed last December to scrap public intervention altogether in the 2007-2008 season. The proposal met with opposition from the European Parliament, which argued last month that a sudden abolition of the intervention would hit the new member states hard, when spring sowing has already begun. In a vote, the parliament proposed to cap the amount of maize bought into public storage at 2 million tons in 2007-2008, 1 million tons in 2008-2009 and zero in 2009-2010.
By the end of the 2005-2006 season, EU maize intervention stocks had spiraled to 5.6 million tons, 40% of total public cereal stocks. Without changes to the current system, these stocks, which are bought and stored at public expense, would have risen to 14.1 million tons by 2013, said the commission. Possible outlets for maize stocks are limited, and maize is unsuitable for long-term storage, it said. The parliament’s rapporteur on the issue, Bela Glattfelder, argued last month that the commission’s analysis does not reflect market trends.
There is currently a high market price of around €120 ($161) per ton, a lower than average crop yield in 2006 and a fall in intervention stocks to 4.28 million tons at the end of 2006, together with an expected increase in world consumption and a growing biofuels market, which is set to be an important market for maize. The rapporteur and the parliament’s Agriculture Committee had suggested overall rejection of the commission proposal.
The EU intervention system for cereals – maize, wheat, barley and sorghum – consists of a single price of €101.31 ($136 at current price) per ton paid to farmers who sell their crops into public storage. The EU produces over 60 million tons of maize per year. France is the biggest grower with around 13 million tons, followed by Italy and Romania (about 10 million each) and Hungary (9 million). (english.people.com.cn)
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