Farmers’ Union of Wales president Gareth Vaughan today called for a national debate on the impact abolishing milk quotas will have on the Welsh dairy sector.

Last November the 27 EU agriculture ministers agreed to lift quotas by one per cent per year before scrapping them altogether in 2014-2015.

Mr Vaughan has written to Assembly rural affairs minister Elin Jones informing her the issue has attracted growing attention on the Continent during recent months, and prompted significant debate at last week's meeting of the EU Council of Ministers.

"There is growing concern amongst many farmers in Wales, and in other parts of the EU, that the full implications of the abandonment of the quota regime have not been properly recognised by the European Commission and others," Mr Vaughan wrote.

"Many believe that such a change would have a destabilising effect on an industry that is already suffering as a result of market volatility, and would have a particularly adverse impact for family farms."

Mr Vaughan told Ms Jones the FUW recognises the restrictions the current regime places on the industry’s ability to react to market demands and believes a more flexible approach to such challenges is needed, rather than the wholesale liberalisation of the current regime.

These concerns were discussed at a meeting last April between the FUW and EU Agriculture Commissioner Fischer Boel and, while the Commissioner was "resolute in her belief that the quota regime should be abolished" by 2015, she also made it clear the matter would be revisited in 2010.

"Given this and the recent volatility of milk prices, there is a real need for the Welsh Assembly Government to engage in further discussions on the impact that abolishing the quota regime will have for the Welsh dairy sector.

"I believe this should happen as soon as possible in order to inform next year's review," Mr Vaughan added.

"It seems perverse that, while the global economy is reeling as a result of under-regulation of the financial sector, and the G20 are proposing far stricter controls, the Commission seems hell-bent on deregulating the milk regime.

"We do not want to find ourselves in a similar situation to the one we now face with regards to sheep EID, with Member States only realising the serious repercussions of what they have agreed to when it is all but too late."

The Farmers’ Union of Wales revealed today it is preparing a case for the European Ombudsman to investigate the EC’s handling of the introduction of compulsory electronic identification (EID) of sheep.

Chairman of the FUW’s hill farming committee, Llangurig sheep farmer Derek Morgan, told the Assembly’s rural development sub-committee of the union’s intentions to contact the Ombudsman during a meeting at Lampeter University.

"I made it perfectly clear to the sub-committee that the union is leaving no stone unturned regarding this ridiculous regulation, and that we believe there are sufficient grounds for the EU Ombudsman to investigate the fact that we will next year be forced to use a technology that has been shown to have major flaws.

"I have first hand experience of EID, having used it on a small proportion of my Welsh Mountain sheep for the past six years, and found that the technology is not sufficiently developed to be practical for the average Welsh flock. This has also been the experience of the vast majority of farmers and slaughterhouses taking part in the latest trials.

"Even when dealing with a small number of sheep that are electronically identified, we are forced to manually record information on paper due to reliability issues with the technology. It's all very well using it to record and monitor a small specialist flock, but scaling its use up for every sheep in the country is madness."

In a written submission to the sub-committee’s EID inquiry, the FUW emphasised the particular problems the regulation would bring for Welsh farmers, highlighting the fact that 80% of Wales comprises Less Favoured land, and that Welsh farms are therefore dependent upon moving animals from the mountains into the lowlands for wintering.

"The impracticality of recording such movements individually on paper means that Welsh farmers are likely to have to invest more heavily in the technology than those in other countries.

"Wales’ largely Less Favoured status also means that Welsh farms are particularly reliant on livestock markets in terms of selling animals to finishers from the lowlands, and the cost of implementing the regulation in markets is likely to either be passed on to farmers, or result in market closures.

"The FUW maintains that the current system of recording and reporting sheep movements represents a more than adequate method of sheep traceability for the purposes of disease control.

"Moreover, the experiences of industry and government during the 2007 Foot and Mouth disease outbreak clearly demonstrated the effectiveness of existing controls in terms of limiting the spread of a virulent animal disease, and problems encountered by the authorities were not related to the absence of a system of recording individual sheep movements.

"The FUW believes that it is unacceptable that the EU intends to impose the costs and impracticalities of EID on farmers within some Member States, while not requiring Third Countries, against which we compete to comply with similar systems of traceability.

"In conclusion, the FUW believes that there is overwhelming evidence to support the withdrawal of the current regulation regarding sheep EID, and that the Ombudsman must investigate this matter thoroughly."

Dairy UK’s Farmers Forum chairman Roger Evans issued a stark warning about future milk production levels when he met the Farmers’ Union of Wales’ milk and dairy produce committee.

During the meeting in Aberystwyth, Mr Evans, a former chairman of First Milk, told the committee of his concerns about the ongoing decline of milk production and dairy farmer numbers.

"Milk production is now at its lowest for over thirty years and something must change in order to arrest this decline," said Mr Evans, who farms 350 acres in Shropshire.

"I am also extremely concerned that this decline will accelerate as dairy farmers struggle to meet the costs of complying with NVZ regulations."

Committee members called for a fundamental change to address the imbalance between farmgate and supermarket check out prices.

After the meeting, committee chairman Eifion Huws said: "There was unanimous agreement with the sentiments expressed by Mr Evans and the union will shortly be meeting with politicians in Westminster and Cardiff in order to raise our concerns.

"It is imperative both government and supermarkets take a long term view in order to address issues such as food security and market volatility.

"Companies that take the short term view undermine farmgate prices making it impossible for businesses to plan for the future.

"Family farms are the backbone of the dairy industry in Wales and the ongoing exodus from the industry should be a major cause of concern for government, consumers, and all those involved in the dairy supply chain."

The FUW today rebuffed claims by animal rights groups that proposals to cull badgers to control bovine TB would make it impossible to know which parts of a control strategy may work.

FUW vice president Brian Walters said: "There is solid scientific data that shows controlling badger numbers reduces incidences of TB by between 50 and 60 per cent. There is also solid scientific evidence showing that cattle controls, when applied in the absence of a wildlife reservoir, reduce TB incidences.

"We therefore know that a combination of both policies will accelerate the eradication of TB.

"No-one with a rudimentary knowledge of basic scientific principles would deny this, and in my mind claims to the contrary by animal rights groups such as the RSPCA and the Badger Trust demonstrate their wish to mislead the general public."

Mr Walters, a Carmarthen organic dairy farmer, also condemned comments by animal rights groups as "deliberately inflammatory" and "designed to mislead the general public".

"The RSPCA has described the decision as one that will ‘‘eliminate badgers from a large area of the Welsh countryside’’. Yet even after five years of badger removal in the English trials badgers numbers remained at levels well above the European average.

"The Minister has also made it clear that healthy badgers could be relocated into the area in order to ensure a sustainable and healthy livestock and badger population would coexist, side by side.

"The comments of the RSPCA are therefore utterly misleading, and the general public must not to allow these to deceive them. Anyone who reads this nonsense should take a step back and look at this situation rationally.

"The science shows that the prevalence of disease in badgers is thousands of per cent higher than it is in cattle, and we know that the disease can pass back and forth between both species, so we clearly need to control the disease in both cattle and badgers.

"That does not mean eradicating either badgers or cattle. The science supports the measures that have been proposed and no one should allow themselves to be misled by statements made by the RSPCA, the Badger Trust, or anyone else."