Based on a report on the quota system for production of potato starch in the EU, the Commission has today adopted a proposal to extend the current quotas to the marketing years 2005/06 and 2006/07. The underlying argument for the proposed status quo lies in the fact that it is too early to assess the effects of the reform of the CAP, and of enlargement of the EU, on the potato starch sector.

The restrictions on production applied in the cereal sector, in particular set-aside, and the increase in production of potato starch at the beginning of the 1990s led to the introduction of a quota system from 1995/96 aimed at limiting potato starch production. Under this system, quotas are fixed by Member State and then allocated between potato starch manufacturers in the form of sub-quotas. The current quotas are fixed until the end of the 2004/05 marketing year.

The main findings of the report that formed the basis of the current proposal can be summarised as follows:

• EU production of potato starch remained close to the quota fixed (period 1998-2004);
• total exports of cereal starch and potato starch remained relatively stable;
• total starch production in the EU has grown at a rate of approximately 2 % per year on average since 1998; the share of potato starch in starch production as a whole is declining, at around 20 %;
• it will probably take up to two years to assess the initial effects of the reform of the common agricultural policy (decoupling), and of the enlargement of the EU on the starch production sector. Consequently, the Commission will present a new report accompanied by an appropriate proposal before September 2006.

The proposed quotas for the 2005/06 and 2006/07 marketing years are as follows (rollover of the quotas fixed for 2004/05):

(Tonnes)