DairyCo

Intervention Stocks

Published 23 July 10

EU Intervention Stocks

• Market prices remain above intervention levels and consequently, there were no sales into intervention in June.
• There remains approximately 1,500t of intervention butter and 79,000t of intervention SMP available for sale in the next tender, to take place on 22 July.

The fourth intervention tender for the sale of butter and SMP resulted in all bids being rejected.  Intervention stocks are falling as product is removed from intervention either having been sold by tender or allocated under the 'deprived persons' scheme to charities. Since the beginning of May, 24,000t of butter have been removed from intervention and 24,000t of SMP. There remains 40,000t of butter and 41,000t of SMP of intervention stocks allocated to the 'deprived persons' scheme which must leave intervention by the end of September.

Market prices are well above intervention levels and nothing is being sold into intervention. For butter, the last product accepted for intervention was in early September 2009 and for SMP, on 8 October 2009.  Excluding product allocated to the 'deprived persons' scheme, there remains only 1,500t of butter but 192,000t of SMP in intervention stores.

Butter is being put into PSA storage (Private Storage Aid, where butter is put into subsidised storage and released during the winter) with 78,173t currently in PSA. This is well below the 115,379t in PSA a year ago when prices were much lower, and may result in tight supplies over next winter. Any butter put into PSA must remain in store until 16 August 2010.

Last year, intervention stores opened on 1 March 2009 after being closed for the winter and in the first three days, the 30,000t limit on butter intervention was reached and a fortnightly tender system was put into operation. It took until April 14 to reach the 109,000t limit on SMP intervention. Intervention stores have remained open throughout the winter, as an 'emergency' measure to support market prices.  From 1 March 2010, the full intervention price applies until the limits above are reached.

By 8 October 2009, 282,587t of SMP had been offered for intervention, including 17,015t in the UK. Butter intervention offers stood at 83,222t with 4,615t accepted in the UK.  Some product offered to intervention was rejected as being of insufficient quality, and so the actual amounts in intervention are lower than the amount offered.

The 2010 'deprived persons' scheme will take 51,148t of butter and 65,290t of SMP from intervention stores between May and September 2010 to be distributed before the end of the year.  

 Figures reflect actual stocks rather than offers to Intervention or to PSA.