Author: Alan Matthews

Alan Matthews is Professor Emeritus of European Agricultural Policy in the Department of Economics at Trinity College, Dublin, Ireland. His major research interests are agricultural policy analysis, the impact of international trade on developing countries, and computable general equilibrium analysis of trade and agricultural policy reforms. He has worked as a consultant to the European Parliament, the OECD, the Food and Agricultural Organisation of the United Nations and the UN Industrial Development Organisation, and has been a panel member in a number of WTO Dispute Settlement procedures. He is a former President of the European Association of Agricultural Economists but writes here in a personal capacity.
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Lessons from the 2009 EU dairy market crisis

The EU dairy market is now recovering from the severe drop in milk prices in 2009. Perhaps the clearest sign of this recovery is the setting of export refunds on dairy products to zero since mid-November, as world market prices for dairy products have strengthened in recent months.

It is thus an opportune time to evaluate the EU’s response to the crisis, and to see what lessons might be drawn for how the Union can address similar problems in other farm sectors in the future. My view is that there is a lot to be learned from the dairy crisis, and that the outgoing Commissioner deserves credit for the way she handled it.… Read the rest

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Eurostat preliminary farm income figures for 2009

Eurostat has just published its first estimates for real agricultural income per worker in 2009. For the EU27, the figure is down 12.2% on the 2008 figure, but with considerable variation across countries, from -35.6% in Hungary to +14.3% in the UK. While differences in commodity price trends and variations in commodity composition across countries will account for much of the variation, other factors include the further phasing in of direct payments (in the NMS) and currency fluctuations against the euro (important in explaining the UK trend).

Eurostat also publishes a comparison of trends since 2005. Choosing any one year as a base is always problematic, given the possibility that the base year is an untypical year.… Read the rest

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Paris Declaration on the Common Agricultural Policy

You can read here the agreed communiqué from the 22 countries which were invited by France to discuss the future of the CAP in Paris yesterday. The meeting itself was surrounded by some controversy given that 5 member states (UK, Sweden, Denmark, Netherlands and Malta) were not originally invited, although the UK did send along a civil servant as an observer. The French Agriculture Minister Bruno Le Maire talked at length about the objectives of the meeting in an extensive interview with Le Monde.

The countries attending were those which had supported the call by France and Germany for stronger measures to support dairy farmers in October this year.… Read the rest

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Comprehensive market price data from DG Agri

Following the recent interest in food price developments, DG AGRI has now released long-term monthly price data for a wide range of farm and first-stage processed products from its AGRIVIEW database. AGRIVIEW is a data warehouse providing a common repository for integrated data for DG AGRI which is normally only available to internal Commission analysts. For example, it includes financial information, market prices, tariff data, and data on export refunds. The market price data on a monthly basis from January 1997 until the most recent date, for both the EU on average and for individual member states, is now available for download as a 7MB Excel file from the DG AGRI website.… Read the rest

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Changes in GM feedstuffs rules on the way?

There now seems to be momentum building up to change EU rules on GM feedstuffs in order to assist the future of the pig and poultry industries in Europe, with the Commissioner Mariann Fischer Boel waxing eloquent on this issue on her blog last week after she raised the issue at the monthly Agricultural Council. According to a Reuters report, the Commissioner has indicated that a proposal on a maximum level for GMO residues in imports should be ready before the end of the year.

The problem arises for two reasons. The first is that the EU has tended to lag behind other countries in the approval of new GM varieties for use in animal feedstuffs.… Read the rest

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Informal meeting Agricultural Ministers in Sweden 14-15 September to discuss agriculture and climate change

The Swedes have chosen to highlight agriculture and climate change at the informal agricultural council meeting next week. The discussion will be built around three questions:

1. Climate change is of great concern for the future competitiveness of EU agriculture and this challenge is being dealt with at all levels. While the framework is set at EU level, implementation will need to be carried out at farm level.

What should be the role of the EU regarding mitigation and adaptation in agriculture, and, in particular, what should be the key areas of cooperation?

2. An instrument in handling climate change in the agricultural sector is rural development programmes.

… Read the rest
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Is EU agriculture carbon-efficient?

A relatively new argument being used to justify support for agricultural production in the EU is that reductions in EU food production would be made up by increases elsewhere where less efficient production systems exist and thus would result in a heavier carbon footprint. This raises the question whether this statement is factually correct and what do we know about the relative carbon efficiency of production systems in different parts of the world?… Read the rest

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UK House of Lords reviews 2010 EU draft budget

In a recent report, the UK House of Lords European Committee criticised the European Commission’s proposals for the 2010 European Communities budget for maintaining a very high level of spending on agriculture, and failing to shift adequate resources to stimulus measures to aid economic recovery. It expressed frustration that, in the middle of an economic crisis, the proportion of the budget going to agriculture remained so large.

It identified a particular problem for the funding of the second tranche of the European Economic Recovery Programme. This was the stimulus package of €5 billion agreed in March 2009, of which €2.6 billion was to be funded from the 2009 budget and €2.4 billion from the 2010 budget.… Read the rest

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Addressing the dairy crisis – is US intervention buying a good thing for EU producers?

Today, the US raised its intervention support prices for some dairy products as a way of supporting the US farm price for milk. The support price for skimmed milk powder was increased by 15 percent and for cheddar cheese by 16 per cent for a limited 3-month period. Immediately milk prices on the Chicago Mercentile Exchange increased by 5 per cent, and it is estimated that the measure will add $243 million to US dairy farm incomes in the current year.

From a European perspective, this measure has ambiguous effects and may even be welcomed for its short-run effects. In the short run, the Commodity Credit Corporation will enter the market as an additional buyer, raising the floor price of milk.… Read the rest

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Where to find data on EU export refunds?

Recently, I was looking for an internet source for EU export refunds – not overall expenditure, but the refund rates for individual commodities by month. What I was hoping to find was an Excel worksheet which set out this information, but it seems extraordinarily hard to come by. The nearest I could get was the excellent webpage on export refunds for milk and meat products maintained by OFIVAL, the French marketing agency. However, the data here take the form of pdf files containing the information every time the refund levels are changed, and it would be extremely tedious to transfer this into an Excel file.… Read the rest