The European Commission has published in the Official Journal of the European Union, OJEU on February 13th 2009, Regulation (EC) Nº 127/2009 laying down the procedure and conditions for the sale of cereals held by paying agencies or intervention agencies. This Regulation recognises that cereals held by the paying agencies or intervention agencies should be sold without any discrimination between Community purchasers, and that in principle invitations to tender permit that objective to be achieved although in certain cases it must be possible to use other methods of sale.

Cereals bought in by the paying agencies or intervention agencies should be put up for sale by invitation to tender or, in the case of resale on the Community market, by public auction. In this terms ‘invitation to tender’ means competition between interested parties in response to a call for tenders, the contract being awarded for each of the lots to the tenderer submitting the most favourable bid from among the bids that comply with this Regulation, for which the price tendered is at least equal to the minimum selling price laid down by the Commission.

At least four days before the first closing date for the submission of tenders, the intervention agencies will draw up and publish a notice of invitation to tender setting out:

• The additional clauses and conditions of sale compatible with this Regulation.
• The main physical and technological characteristics of the various lots established upon buying in by the intervention agency or during checks carried out subsequently.
• The places of storage and the names and addresses of the storers.

The intervention agencies will specify for each lot the port or place of exit which may be reached at the lowest transport costs and which has adequate technical facilities for exporting the cereals put up for tender.

They will ensure that notices of invitation to tender are properly publicised, in particular by displaying them at their head offices and on their website or the website of the competent ministry. Notices and any changes on them must be forwarded to the Commission before the expiry of the first deadline for the submission of tenders.

Intervention agencies will immediately inform all tenderers of the outcome of their tender. They shall forward statements of award of contract to the successful tenderers within three working days of the said notification, by registered letter or written telecommunication.

In the case of invitations to tender for export, steps must be taken to ensure that the cereals are not put back on the Community market. That risk exists if the selling price is less than the minimum price to be observed in the case of resale on the internal market. Provision should accordingly be made in such cases for the lodging of a second security, which must be equal to the difference between the selling price and that minimum price.

Regulation (EC) Nº 127/2009 will enter on March 5th, 2009.

Biofuels and agricultural products held in intervention storage

The rise in processing cereals to produce biofuels for use in Community transport forms part of a raft of measures designed to meet the Community’s environmental commitments. Promoting the use of biofuels may therefore open a new market for agricultural products held in intervention storage in the Member States, provided that prices applicable to the sale of cereals reflect this specific market in biofuels.

Nonetheless, purchasing cereals to produce bioethanol and its use as a biofuel may prove particularly difficult. Provision should therefore be made for selling intervention stocks at special prices in such cases.