EU boosts aid for dairy farmers

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Dairy farmers in the European Union are to receive 280m euros (£255m) in aid, says the EU's farm commissioner.

The decision follows weeks of protests by thousands of farmers over the low price of milk, including the spraying of milk onto fields.

Most of the EU's member states - including France and Germany - had been pressing for aid after the global economic downturn reduced demand.

Dairy farmers say milk costs more to produce than they can sell it for.

EU Farm Commissioner Mariann Fischer Boel said she was forced to "empty her pockets" to meet the demands of 21 of 27 member states seeking an emergency fund for dairy farmers.

The aid will be drawn from the bloc's 2010 budget.

Meanwhile, hundreds of farmers were holding a protest - their third in as many weeks - in Luxembourg, where EU farm ministers were meeting on Monday.

Farmers' frustrations

Last month, the EU announced it would change EU state aid rules to let member states pay each farmer up to 15,000 euros in temporary aid.

That decision followed the dumping by angry Belgian farmers of three million litres (660,000 gallons) of milk on fields.

Germany and France are among those pressing for more EU price support

French and German farmers have also dumped milk and blocked deliveries in frustration at the low prices for dairy produce.

Farmers say they want the EU to freeze planned increases in production quotas, because boosting the supply on the market lowers prices further.

The EU plans to phase out milk quotas by 2015 and to limit market intervention that supports prices, with a view to scrapping it in the long term.

The Commission plans to extend EU special purchases of butter and skimmed milk powder to at least February next year, to help farmers. The European Parliament has backed the plan, but wants it to include cheese too.

These EU market interventions help support dairy prices.