EU nations split on market intervention to prop up milk

European Union nations disagreed Monday on whether to intervene in markets to help dairy farmers overcome low milk prices, diplomatic sources said.

Poland, backed by Estonia, urged EU farm ministers at talks in Brussels to agree exceptional measures "as soon as possible," including the return of export subsidies, to avoid a repeat of the 2009 dairy crisis.

But the EU's agriculture commissioner Dacian Ciolos said there was no justification for such a move, particularly given the drop in the euro against the dollar.

The EU executive said the price fall in the last months came on the back of an increase in farm gate milk prices and was due to a strong increase in production in the world's main supplier regions -- a 3.0 percent increase in the EU in 2012, a 9.9 percent increase in New Zealand and 5.5 percent in Australia.

The average price in the EU in May -- 31.6 cents a litre -- remained 30 percent above 2009 levels.

A diplomatic source said Poland's call for emergency measures was backed by Belgium, Hungary, Portugal and Slovenia.

Britain, Germany and Luxembourg opposed intervention.

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