Further reductions of EU export refunds (subsidies) would come after 2005 when the Qatar round of WTO negotiations concluded, Mr Willi Kampmann of the German Farmers' Association, predicted yesterday.
But he said the disadvantage to dairy farmers would be offset to some extent by the expansion of the EU into Eastern Europe.
At the Irish Co-operative Organisation Society (ICOS) conference in Dublin, he said it was difficult to determine what the reduction would be.
"In future, we have to look at export refunds for different products. A lot don't need export refunds," he added.
But he said that while the Cairns Group of countries and the US pushed for a reduction of EU export subsidies, which were transparent and obvious, many of these countries subsidised their own exports. The negotiations would have to consider dismantling the monopolistic Australian and New Zealand export agencies and consider the US finance credit support scheme, which subsidised US farmers.
The (last) Uruguay round of WTO negotiations had not been too bad for the European dairy industry and now enlargement of the EU presented new opportunities.
"I think we have good chances. Dairy production in Eastern Europe is very poor. There will have to be a lot of investment, a lot of good farmers to produce high quality milk and, for the animal sector, I think we have more chances than risks."
The dairy industry had to keep and improve its current "excellent" image. It had profited from the BSE crisis, with cheese consumption in Germany increasing considerably and sausage consumption dropping dramatically.
The president of the ICOS, Mr Dessie Boylan, said he was concerned that if milk quotas were phased out after 2008, there would be greater volatility in the dairy market.
The US market was an example of how widely producer prices and product prices could fluctuate in response to changes in the supply/demand balance. US cheese and butter prices fell by 30 to 40 per cent in a two-month period due to increases in production.
Markets for dairy products had weakened in recent months, and skimmed milk powder was now being sold at below the EU intervention price.
