McIlveen encourages Northern Ireland farmers to take advantage of €150million EU dairy aid scheme

Agriculture Minister Michelle McIlveen today announced details of a €150million European Union aid scheme to incentivise farmers to voluntarily reduce their milk deliveries.

The Milk Production Reduction Aid is part of a €500million aid package, agreed at the Agri-Fish Council in July, designed to encourage farmers to reduce milk production to counter the over-supply situation and help restore prices. The EU is seeking to achieve a total reduction in milk deliveries of just over one million tonnes, compared with the same period last year. 

Farmers will be compensated if they reduce their production in any one of four separate three-month periods between October 2016 and March 2017. The scheme is expected to start on 11 September 2016 when the legislation comes into operation. Applications for aid from Northern Ireland dairy farmers may be submitted to the Rural Payments Agency (RPA) who will administer the scheme on behalf of all UK regions. Applications for the first reduction period, running from October to December 2016, must be submitted to the RPA by 21 September 2016. 

The Minister said: “The dairy sector in Northern Ireland has been experiencing a prolonged period of severely depressed prices and our local farmers have been particularly affected. I am pleased that our dairy farmers can now apply for EU aid to support a reduction in their milk deliveries to processors should they choose to do so. 

“I would encourage dairy farmers to consider the detail of the scheme rules carefully and to ensure that they have the necessary supporting documentation readily to hand, should they decide to submit an application.”

Further information and details on how to apply are available on the Defra website.

The remaining €350million of the July 2016 financial package is for EU Exceptional Adjustment Aid which has been allocated to Member States to spend on measures that foster the economic sustainability of farms and that contribute to market stabilisation. The UK aid envelope is around €30million.  

Minister McIlveen added: “I am committed to supporting farmers in Northern Ireland at this difficult time and to helping build a strong, sustainable and resilient agri-food industry for the future. I have made the case for Northern Ireland to receive a significant share of the UK envelope of EU Exceptional Adjustment Aid. I am currently considering the options for how best to use our allocation and will make a further announcement about this aid at the earliest opportunity.”

Notes to editors: 

1. The Milk Production Reduction Aid is part of the €500million package of financial aid for the farm sector agreed at the EU Agriculture Council Meeting on 18 July 2016.
2. The EU Milk Production Reduction Aid will operate as an EU-wide measure which Member States are required to administer. Participation at farmer level is entirely voluntary; it will be for individual farmers to decide if and when they wish to avail of the scheme, and the extent of the reduction they wish to make, within the minimum and maximum quantities specified.
3. The Commission is seeking to achieve a total reduction in milk deliveries of just over one million tonnes, compared with the same period last year. Farmers will receive around 14 cents per kilo of reduction (equivalent to around 12ppl). 
4. Farmers can apply to reduce their production in any one of four separate three-month periods (tranches) between October 2016 and March 2017. Only one application may be submitted per farmer. There is an exception for those who apply to tranche 1; they may also apply to tranche 4.
5. Only dairy farmers who were delivering cow milk to first purchasers in July 2016 are eligible to apply for aid. The minimum reduction quantity that will attract aid is 1,500kg or (1,457l); the maximum is 50% of the farmer’s milk production during the same three-month period in the previous year. 
6. If applications for the first three-month tranche (October to December 2016) exceed the total volume (1.1 million tonnes), the Commission will apply a reduction co-efficient to the applications: farmers will then be notified of their confirmed reduction quantity. Tranches 2-4 (November 16 to January 17; December 16 to February 17; and January 17 to March 17) will only proceed if there is sufficient volume still available.
7. Farmers will not receive any additional money if their reduction exceeds the quantity specified in the approved application. Conversely, if farmers fail to achieve all of their specified reduction a sliding-scale of reductions to the aid payment will be applied.
8. Applications for the first three-month tranche (October to December 2016) must be submitted by 21 September 2016. Following the first tranche, farmers’ applications for payment must be submitted by 14 February 2017. Following the necessary verification checks on the amount of reduction delivered, the first payments must be made by end March 2017, with the last date for all payments being 30 September 2017. 
9. Producers from Northern Ireland who supply to co-operatives/purchasers in the Republic of Ireland are entitled to avail of the scheme. They should apply in the normal way to the Rural Payments Agency. The farmer will need to provide the relevant proof regarding milk supply from their purchaser.
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