Ireland's dairy farmers were warned yesterday that retaining the EU milk quota system was "effectively going out of business" at a meeting where it was claimed 100 farmers a week are leaving the land.
The warning was given to the annual general meeting of the Irish Creamery Milk Suppliers' Association in Limerick by Prof Seamus Sheehy, one of Ireland's leading agricultural economists.
He said there was a clear inconsistency between the EU Commission's proposals to cut beef supports by 30 per cent, cereal supports by 20 per cent and the proposal to cut milk supports by 10 per cent.
He told the farmers the 10 per cent cut was an "unnecessary and futile gesture", and the Santer proposals, aimed at reforming the Common Agricultural Policy (CAP), should have reduced milk supports at the same levels as beef and cereals or not at all.
Irish dairy farmers, he said, would lose their natural advantages of producing milk from grass, because of the Santer proposals to keep the milk quota system to the year 2006.
"Because of that, Europe will continue to lose its world market share. Continuing the quota is effectively going out of business," he said.
Prof Sheehy said dairy farmers would have to be able to trade at world prices to survive. Being tied into a quota system limited the farmers' ability to expand and use natural advantages.
He said that to stick with the quota was to see a declining world market share, with a growing scramble for scarce quota and a growing number of "quota lords" who lived off the rents of those who toiled to produce milk with leased quota.
He said the EU was incorrectly working on the assumption that there would be no World Trade Agreement until 2006. Europe's farmers, he said, would be under increasing pressure from the WTO partners to get an agreement much faster than that and to cut supports long before then.
In his presidential address, Mr Frank Allen said there was deep uncertainty about the future of farming. A lack of action by successive governments on planning the agriculture industry was causing 100 farmers to leave the land every week, he said.
"The benefits of the Celtic Tiger economy are by-passing farmers. Almost every other sector, apart from farming, is riding on the crest of a wave due to Ireland's booming economy," he said.