Agriculture, EU – Baltic States, Financial Services, Legislation, Markets and Companies

In a petition sent to the European Commissioner in charge of agricultural policy Phil Hogan, the organisations note that milk producers have encountered a difficult situation as a result of political decisions made jointly on the EU level.

“Milk producers do not question the necessity to impose sanctions on Russia, but the counter-sanctions extended by Russia mean that the closest and most profitable exports market remains closed for the Baltic States' agricultural producers,” stated the Estonian Chamber of Agriculture and Commerce.

The organisation added that the Baltic States' dairy industries have made serious efforts to find new markets for dairy products, but understandably there is no quick solution to be found.

The petition emphasised that because of sanctions, the ones suffering the most are the milk producers in the Baltic States, as they are paid the lowest price for milk in all of European Union.

Latvian Prime Minister Laimdota Straujuma and Minister for Agriculture Janis Duklavs in Brussels held a meeting with Phil Hogan, European Commissioner for Agriculture and Rural Development to discuss the European Commission's future support for Latvian milk producers and processors.

Prime Minister Laimdota Straujuma welcomed the opportunity to meet the Commissioner to discuss the state of the Latvian agricultural sector, and especially the dairy sector. "As the result of Russia's sanctions, our milk producers have lost an important export market – dairy exports to Russia have declined by 40%," said L. Straujuma.

The Prime Minister and the Minister for Agriculture informed the Commissioner that the dairy sector accounts for 25% of the Latvian agricultural sector and, in 2013, 60% of milk was exported. According to what was said in the conversation, the purchase price for milk has fallen by 20% compared to July 2014. The Prime Minister and Minister for Agriculture emphasized – in view of EUR 200 million invested in the development of the dairy sector from 2007 to 2013, it would be important not to lose this contribution due to current difficulties.

“The Latvian government has, for its part, just granted the Latvian farmers EUR 7.6 million to support breeding. Over the last year, our manufacturers have begun to acquire 18 new markets; however, this process is not fast. Therefore, in this transitional period, the EC support measures would be very substantial," said L. Straujuma. The Minister added that the loss of the dairy sector over last eight months amounts to EUR 44.3 million.

“Commissioner Phil Hogan expressed his understanding of the fact that the situation in the Latvian dairy sector is more complex than in other Member States of the European Union, which have been adversely affected by Russia's sanctions and decline of purchase price for milk following the abolition of the quota system. The Commissioner for Agriculture confirmed that the European Commission will prepare a proposal in support to the Latvian dairy industry until the extraordinary meeting of the EU Agriculture and Fisheries Council on 7 September, “stressed J. Duklavs.

EC Commissioner Phil Hogan thanked for the opportunity to hear views on the situation in the Latvian dairy sector. “This situation is grave. I would like to assure you that the EC will examine all possible support measures within the next two weeks”.