Deduction and premium temporary standstill measure

9 March 2017

The temporary FrieslandCampina standstill measure was in force from 9 January 2017 until 1 March 2017, the moment that the Phosphate Reduction Plan became effective. The objective of the temporary standstill measure was to keep the total milk supply of FrieslandCampina in balance with the company’s available processing capacity. During the period in which the temporary standstill measure was in force, a total of 53 million kilos less milk was supplied compared to the reference volume. A total amount of 6.85 million euro was paid to the member dairy farmers in connection with this temporary cooperative arrangement. Also as a result of the temporary standstill measure, the milk supply remained stable in January and February 2017 in relation to the supply in the same period of the year 2016.

Premium of 12.65 euro per 100 kilos milk in February

In the period from 1 February to 28 February 2017 inclusive, 8,084 dairy farms supplied 39.7 million kilos less milk compared to the reference volume established for each dairy farm. The farms that meet the conditions will receive a premium for the less supplied milk with respect to the reference volume. For the period 1 to 28 February inclusive, the premium will be 12.65 euro for each 100 kilos less supplied milk. The premium is financed from the total deduction and will be paid out for a maximum of 10,000 kilos less supplied milk per month. The deduction and the premium were settled in the milk money account for the month of February 2017. The premium for January was 10.19 euro per 100 kilos milk.

Deduction in February 4.0 euro

In the period from 1 February to 28 February 2017 inclusive, 4,167 dairy farms supplied 12.7 million kilos milk above the reference volume established for each dairy farm. To these farms, a deduction applies of 31.50 euro per 100 kilos milk (90 percent of the guaranteed price of February 2017) for the amount of milk above the reference volume. The total deduction in the second period amounts to 4.0 million euro. The deduction was 2.85 million euro in January.

The temporary measure applied to member dairy farmers of Zuivelcoöperatie FrieslandCampina U.A in the Netherlands. The member dairy farmers supplying milk in conformity with the organic milk money regulations and member dairy farmers in Germany and Belgium were excluded from this measure.