Producers defend milk price rise

ALONG with cattle farmers, milk pasteurisers have announced they will raise prices to accommodate increased production costs.
Milk pasteurisers issued an announcement this week saying they need to raise the price of wholesale milk by nine cents per litre, but said that would mostly go towards covering the price hike coming from the cattle farmers.
Cattle farmers have raised raw milk prices by four cents a litre from January 1 and have said they will also raise prices by an additional 1.8 cents a litre on April 1 to cope with the price of animal feed.
The head of the milk pasteurisers’ association Marios Kampanellas said that they too were trying to cover the rising cost of electricity, fuel, and water.
But he said that the actual cost from cattle farmers accounted for 6.8 cent of the total figure, because the cattle farmers refer to raw milk prices using a baseline that is based on a fat and protein content that is actually lower – and so cheaper – than what they actually buy.
Cypriot consumers pay for the most expensive milk in the European Union, with prices also rising faster than elsewhere in the EU.
Almost two years ago, the cabinet approved a bill giving the commerce minister the right to set a ceiling on the prices of bread, water and milk.
Ruling party AKEL issued an announcement yesterday asking the commerce minister Neoclis Sylikiotis – whose term expires this February – to consider setting price cap on milk.
Sylikiotis reportedly said yesterday he was considering setting a price cap on milk wholesale and retail prices, though it was not immediately clear how and when this would get implemented.
Over 70 per cent of Cyprus’ cattle farmers are part of the cattle farmers’ association (POA) which has exclusive agreements with some of Cyprus’ major supermarkets.
A new EU regulation that Cyprus should have implemented by early October states that milk producer groups in small markets – including Cyprus – can only represent 45 per cent of total production.
POA head Nikos Papakyriakou said they were exempt, citing what he effectively perceived as a loophole: POA is not, technically speaking, a milk producers’ body and would need to apply to be recognised as an organised body that would be subject to the regulation, he said.
“We are a milk and meat body, not a milk-only body but at any rate we are only a team of people, not an organisation,” Papakyriakou added.
But it is understood that POA is under investigation by the commission for the protection of competition.

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