Warm Welcome For Ciolos Commitment To Transparent Stocks

15 June 2011
Alyn Smith MEP, SNP member of the European Parliament's Agriculture Committee, has today (Wednesday) expressed his support for Agriculture Commissioner Dacian Ciolos' proposal for greater transparency of market projections and stocks in the European Union, as an important step in the battle for food security and against price volatility.
Mr Ciolos declared that he was in favour of a data collection system at EU level for short term market projections on cereals, oilseeds, milk and milk products, and meat, with member states informing the Commission on the state of all private and public stocks, including the EU's own intervention stocks.

The proposals come in advance of the G20 summit, held in France in November, which will attempt to deal with problems of price volatility on a global scale, through action on transparency, stocks, biofuels and commodities regulation. The FAO's Food Price Index stands at record levels for many essential commodities, while internal Commission data suggests higher price volatility over the past decade for many commodities compared to previous times.

Smith said:

"Securing adequate food production, and accessibility to food supplies for all, is one the major challenges of the coming century. We need look no further than this year's disastrous drought across much of Europe: Germany is expecting a drop in 7% of wheat production and France 11%. In a worst case scenario the UK's exportable surplus could be wiped out, and we would be reliant on increased imports from Australia and the Ukraine. The FAO has had to downgrade its forecasts for crop growth due to the bad weather, and, critically, global stocks-to-use ratios are declining back towards where they were in the price spikes of 2008. In particular, the maize stocks in the USA are described as "at a critical low". Farm-gate prices might be rising, but rocketing input costs mean that the farmer does not necessarily see much benefit.

"That's why action is needed on an international scale. Europe should be leading and I'm glad that our Commissioner is voicing his concerns over these dangers. Transparent information on production and stocks is an absolute necessity for efficient food distribution and future production planning. Given that global stocks are building up in countries like China, which we may well not always have access to, it's essential to ensure we have adequate reserves in Europe.

"I'm hopeful that the G20 summit will take further action, particularly on ending public subsidies to biofuels and diverting these crops to food production, and on ensuring robust regulation of commodities markets so that prices are not driven artificially high by speculation. And this current precarious situation should underline, again, the folly of winding down direct payments in the Common Agricultural Policy now, which would have a downward pressure on production at a time when we need it to rise."