EU support for Campina declines further

The 50 million Euro market and price support which Campina expects to receive in 2006 will now therefore be 65 percent lower than in 2003. Campina’s Dutch branches received EUR 140 million in subsidies in 2003 as a result of EU regulations.

09/06/06 The European dairy policy reforms have also had clear repercussions in 2006 for the international co-operative dairy organisation Campina. Following the earlier reduction of the support by EUR 50 million to EUR 77 million in 2005, a further reduction of an estimated EUR 27 million is planned in 2006. The 50 million Euro market and price support which Campina expects to receive in 2006 will now therefore be 65 percent lower than in 2003.

In the light of these fundamental changes in EU agricultural policy, Campina has striven for years to uphold a consistent strategy with the aim of compensating its member dairy farmers for the effects of the structural decline in prices for basic dairy products. Campina succeeded in this objective in 2005. For decades, Campina has been among the top in Europe where milk price is concerned.

The Dutch Dairy Organisation (NZO) recently presented an overview of the support received by the Dutch dairy sector. This support is a result of EU regulations aimed at reaching a reasonable price level for buyers (consumers) and manufacturers within the European Union. Examples of these regulations are intervention, processing support and export restitutions.

Campina’s Dutch branches received EUR 140 million in subsidies in 2003 as a result of EU regulations. This was EUR 127 million in 2004 and EUR 77 million in 2005.

The reduction of the market and price system is structural. This will be partly offset by direct compensation payments for dairy farmers. The decision to pursue this policy was taken by European government leaders in 2004.

Campina’s strategy to permanently add value to milk for the member dairy farmers is aimed at becoming less dependent on the European market and price policy and on the price developments for basic dairy products. Campina does this primarily by means of international growth, innovations and cost control.