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Oceania and the Europeans not happy with DEIP

All sorts of fall-out from USDA’s announcement on Friday that they plan to fullyutilize the Dairy Export Incentive Program. New Zealand and Australia were first to respond complaining the move will dump excess U.S. production on the world market at subsidized prices and in turn pull world prices down. . Trade ministers from both Australia and New Zealand say they will askthe U.S. to reconsider at a Cairns Group ministerial meeting next month in Bali. New Zealand is the world’s largest dairy exporter.

The U.S. move was actually in response to the European Union’s decision to reinstate their dairy export subsidy program back in January. TheEuropeans however contend they calculated the impact their move would have before implementing the subsidies and determined they would not have a negative impact on the world market. E.U. Ag Commissioner Mariann Fischer Boel said they were just helping “struggling exporters better compete onthe depressed world market.”

Meanwhile, European dairy producers have taken to the streets to protest low prices. Reuter’s reports some 900 farmers from across Europe protested at the European Commission in Brussels on Monday demanding something be done. In Berlin,hundreds of tractors lined-up from the Brandenburg Gate to the Victory Column while in France some 12,000 dairy farmers blocked work at more than 80 processing plants around the country.

Commissioner Fischer Boel says they may be able to move-up some direct paymentsscheduled for the middle of October but stood firm against calls to drop scheduled reforms of EU dairy policy. Those reforms call for an end to European production quotas by 2015.