The European Union (EU) plans to abandon payments to put maize in public
storage because the crop doesn't keep well and prices are being distorted as
The EU has tightened the criteria for accepting maize into public stocks as
supplies built up to 5.1 million tonnes, or two-thirds of all stored grains. In
the so-called "intervention"
system the EU pays producers to remove surplus grain, meat or milk powder to
balance the 25-nation market. When this system was not in place it created great
wine "lakes" and butter "mountains" that plagued markets in the 1980's.
Growth in maize stocks
Maize stocks have been
growing since 10 new members joined the EU in May 2004, with Hungary now
accounting for 93% of the total. With Romania, Europe's number two maize
producer, set to join the bloc next month, the surplus may reach almost 19
million tons in six years, according to the commission.
current market circumstances, there's no reason to be rushing this through,"
said Paul Temple, chairman of the cereals committee at the European farm lobby COPA-Cogeca in
Brussels. „At the moment the market is strong enough that it's not
The proposal to end payments in July will be presented to the
European Commission, the EU's executive body, in two days. Maize for January
delivery was trading on the Paris exchange at about €155 ($206) per tonne this
week. The EU sets a guaranteed minimum price of €101.31 per tonne for putting
the crop into storage at the start of the marketing year in
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