Europe's common agricultural policy is broken – let's fix it!
The budget monitoring website FollowTheMoney.eu is serialising a three part survey of the long history of fraud in the Common Agricultural Policy. Things are better than they once were but to invert the old Yorkshire saying, where there’s brass, there’s muck.
This group blog on European food and farming policy began in 2008 during the ‘health check’ or policy review of the CAP and could be found at the URL caphealthcheck.eu. The ‘health check’ is now well in the past and it’s time to rename this blog to keep up with the times and to introduce a new design. We hope you like it. The entire archive has been transferred to the new domain at capreform.eu and hopefully all the subscriptions (email and RSS) should continue to work. If there are any problems, use the contact form to get in touch.
Britain’s National Farmers’ Union is noted for its strategic, long-term view of agricultural issues. Its officials have a sophsiticated, well informed view of developments and it was therefore interesting to read an interview in the latest edition of Farmers Weekly with the NFU’s head of economics and international affairs, Tom Hind. He was at one time acting head of the NFU’s office in Brussels.
Not surprisingly, he takes the NFU line that farmers need to continue to receive the single farm payment (SFP) to give them a degree of income stability, especially faced with volatile markets. A basic tenet of agricultural economics is that markets for farm commodities are relatively unstable: to put it at its simplest, even with modern agronomy, the weather remains a factor which can disrupt such markets.… Read the rest
Sugar did not experience the massive price spike in 2007-08 of other commodities, but has been making up for this with a tremendous increase in prices in 2009, driven by poor harvests in Brazil (the world’s largest producer) and strong import demand in India (the world’s largest importer). Raw sugar prices have risen from around 10 USc/lb in May 2008 to over 27 USc/lb currently, and market analysts expect further increases in the coming months.
The increase in world prices means that world prices are now above the (much reduced after the recent sugar reform) EU reference price. Recent price trends are shown in the following figure, reproduced from the SugarTraders website
Despite the very tight global market, EU sugar beet supplies have moved in the opposite direction.… Read the rest
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
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
Over at the excellent farmpolicy.com Roger Waite, editor of Agra Facts, has posted a thorough account of the appointment of the new EU Agriculture Commissioner Dacian Ciolos. He says that while Romania had sought the powerful position, it was really a case of appointment by default:
I tend to feel that Barroso was left with no other option, as no one was willing to put forward a good candidate – and that he was the only suitable candidate from among the nominees.
Five leading European farming and environmental NGOs, who between them boast several million members, have jointly published a blueprint for a new Common Agricultural Policy. In an unusual and very modern step, they have published a draft proposal and opened it for consultation. They will produce a final version in 2010. The proposal, which runs to 28 pages, is for a radical reorientation of the CAP away from a productivist and income support model towards a ‘public money for public goods’ ethos.
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
Scotland is far more in tune with current thinking on farm subsidies in mainland Europe than England and Wales, claims Scotland’s rural affairs minister Richard Lochhead. Addressing farmers at a Christmas Carcass competition in Inverurie, Mr Lochhead brought them glad tidings about the deep divide in agriculture policies on the two sides of the border. ‘My opinion on CAP reform is very different from DEFRA’s view that all direct subsidies should be removed and we should rely on a free market. Scotland should not go down that route and our thinking is much closer to the mainstream of Europe which is that the pendulum is swinging back towards support for active agriculture.’… Read the rest