Europe tries to deal with surplus

Press, 27 November 1986, Page 30

Europe tries to deal with surplus

NZPA-Reuter Brussels The European Commission is working on strict proposals for guaranteed prices for European Community farmers in 1987 in an attempt to deal with huge surpluses, commission sources said. They said the commission was almost certain to announce proposals in the next two months to freeze prices paid to farmers who sell produce into the Community’s E.C. stores. The stores act as buyer of last resort for its 12 million farmers when they can find no other outlet. The sources said that the commission plans are also likely to include measures to make farmers contribute more towards the cost of storing and disposing of surpluses. E.C. farm subsidies that have helped create huge “mountains” of stockpiled agricultural products anger trading partners and the Third World. But

farmers’ organisations in E.C. countries are already furious at commission proposals unveiled earlier this month to cope with massive dairy and beef stockpiles. But the sources said the surplus problem had become so severe that the commission had no alternative but to put forward strict proposals. Unwanted butter in store exceeds 1.5 million tonnes, and there are 600,000 tonnes of excess beef and 16.4 million of surplus cereals. Storage costs some five million European Currency Units (dollars) daily. The commission already expects E.C. farm spending to exceed by three billion the 22.9 billion E.C.U.s originally envisaged for 1987. Attempts to export the surpluses at lower world market prices through the use of high export subsidies have strained the E.C. budget and led to charges of dumping by Third World States.