The European Commission yesterday proposed the suspension of import duty on cereals until next June in a bid to increase the provision of cereals on the European market and to push down record prices.

If agreed to by EU member states, the move, which would exclude oats, should improve the situation in Malta as importers can start buying their supplies from non-EU countries without paying import duty.

In theory this should bring prices down, although only to a small degree because prices on the international market are relatively high.

Like the rest of Europe, Malta has been experiencing rapid hikes in the prices of cereal-dependent products such as dairy products, bread and meat. The government has had to intervene by boosting subsidies on flour, milk and animal feed.

The Commission yesterday described the current situation as critical. Last July, total cereals stocks in the EU were 13.2 million tonnes below levels at the same time last year.

Due to bad weather output is declining. From a traditional net exporter, the EU has become a net importer.

Meanwhile, the European cereals market has seen a spectacular surge in prices.

Brussels said that since the start of the current marketing year (July), the price of milling wheat in France has gone up from e179 per tonne to almost €300 per tonne at the start of last September.

In Germany, bread-making wheat was selling at 70 per cent higher than the previous year by mid-August.

Market prices for feed barley have increased in the wake of rising wheat prices.

On the French market, feed barley has more than doubled over the summer 2006 rate, listing at up to €270 per tonne at the end of last September.

The high price of barley has triggered a rise in demand for maize for animal feed.

French maize prices followed the same trend, rising from €183 per tonne at the start of July to a peak of €255 per tonne in mid-September.

European Agriculture Commissioner Mariann Fisher Boel said yesterday she hopes this proposal will help facilitate cereals importation from outside the EU and reduce tension on European grains markets.

EU agriculture ministers will be meeting on December 18 to discuss and possibly approve the proposal.