I only recently came across a paper by Franklin Dehousse and Peter Timmerman published by the Egmont Institute, the Royal Institute for International Relations in Belgium entitled The New Context of the Agricultural Debate in Europe. Although published in June of this year, and thus written prior to the recent political conclusion to the CAP Health Check, it provides an excellent summary of CAP developments since the 2003 Mid-Term Review. The paper is not an evaluation of the reforms (Dehousse is a lawyer and Judge at the Court of first instance of the European Communities) but a well-referenced account of the road the CAP has travelled in the past five years.… Read the rest
World food prices and the CAP
Jorge Nùñez Ferrer of the Centre for European Policy Studies in Brussels has an interesting comment on the possible implications of current high food prices for future CAP reform in the debate on the post-2013 EU budget, in which he rather despairingly projects that “the French Presidency will seek to strike a deal in the name of world food security to maintain (if not increase) the present budgetary allocation for the CAP for the next Financial Perspectives, similar to the agreement struck between Chirac and Schroeder in 2002.” Certainly, the way the CAP should be reshaped in an era of higher world food prices is a new element in the debate on CAP reform which it is obviously hugely important to address.… Read the rest
Do-ha, So-wha'?
The internet silence following the collapse of the Doha Round on 30 July last has been striking. It appears not only the negotiators but also the commentators feel the need for a well-earned August break. In a piece for last Sunday’s Irish Sunday Business Post, I tried to summarise my own views on why the Round collapsed.… Read the rest
Do-ha, So-wha’?
The internet silence following the collapse of the Doha Round on 30 July last has been striking. It appears not only the negotiators but also the commentators feel the need for a well-earned August break. In a piece for last Sunday’s Irish Sunday Business Post, I tried to summarise my own views on why the Round collapsed.… Read the rest
The CAP's ambiguous face to the outside world
The description of a Fortress Europe has often been applied to the CAP. But just as the CAP has undergone significant internal reform since the first faltering steps under Commissioner MacSharry in 1992, there have also been substantial changes to the CAP’s external trade regime. The EU still maintains high tariffs on specific agricultural imports, but in fact the majority of the EU’s agricultural imports (including here fish as well as highly processed products like beverages and tobacco products) enter the EU duty-free, either because the Most Favoured Nation (MFN) tariff is zero, or because the EU has granted duty-free preferential access.… Read the rest
The CAP’s ambiguous face to the outside world
The description of a Fortress Europe has often been applied to the CAP. But just as the CAP has undergone significant internal reform since the first faltering steps under Commissioner MacSharry in 1992, there have also been substantial changes to the CAP’s external trade regime. The EU still maintains high tariffs on specific agricultural imports, but in fact the majority of the EU’s agricultural imports (including here fish as well as highly processed products like beverages and tobacco products) enter the EU duty-free, either because the Most Favoured Nation (MFN) tariff is zero, or because the EU has granted duty-free preferential access.… Read the rest
EU wrong to get involved in provision of free fruit and vegetables
Yesterday, the Agriculture and Rural Development Commissioner announced an EU-wide scheme to provide free fruit and vegetables to school children between the ages of 6 and 10. The purpose of the scheme is to encourage more healthy eating habits among children as a contribution to the campaign to fight the obesity epidemic which is storing up very large health costs for European countries in the future.
While the objectives of the scheme are entirely laudable and should be supported, I strongly question what business the EU has getting involved in promoting a School Fruit Scheme (although the scheme also covers vegetables, it seems to be referred to as a fruit scheme – vegetables were always the poor relation!).… Read the rest
New Humboldt University report on global market trends
Another study forecasting higher real food prices for the next decade has recently been published by three authors associated with the Humboldt University in Berlin led by Professor Harald von Witzke. The working paper provides a useful qualitative survey of the reasons why agricultural supply will have difficulty in keeping up with the demand for food and other products of agriculture (including bioenergy). For the more technically minded, it uses a partial equilibrium multi-market model (descended from the venerable SWOPSIM model once supported by the US Department of Agriculture) to provide quantitative estimates of price levels for the key grains and oilseeds which are the focus of the study.… Read the rest
What is happening to EU land prices?
The evolution of agricultural land prices and rents can be a good indicator of the effect of agricultural policy, because of the assumption that a significant proportion of the transfers to farmers as a result of such policy are capitalised into land values. Thus, changes in agricultural policy may have implications for land values, and the prospect of capital losses due to a fall in land values can be one source of opposition to such changes.
The issue is relevant in the context of the Commission’s proposals to introduce a ‘regret clause’ with respect to the implementation of the Single Payment Scheme as part of the Health Check.… Read the rest
Milk quota removal could cost EU farmers €4 billion
The elimination of milk quotas as currently foreseen in 2015 will result in a loss to producers of €4 billion, and a gain to consumers of €3.7 billion, according to research by economists at the Institut d’Economie Industrielle in Toulouse. The group were asked to evaluate the impacts of the expiry of the EU milk quota system, comparing particularly a ‘soft landing’ scenario in which milk quotas are gradually increased between now and 2015, and a ‘hard landing scenario’ in which quotas are maintained until 2015 and then eliminated in that year. The ‘hard landing’ scenario postpones the adverse effects for producers both in competitive milk-producing countries (where quota rents are currently high) as well as in countries which currently are not meeting their quota.… Read the rest