For a legitimate, sustainable and supportive Common Agricultural Policy
I. Why the CAP should be changed?
The collapse of the Cancun WTO negotiations last September has clearly brought to light the deadlock taken by the European Union in its way of reforming the CAP. The CAP needs to find back its international credibility and legitimacy. With the end of the peace clause on 31 December, the EU is likely to face a series of complaints at the WTO, which will oblige the EU to review the CAP reform. By forcing a little bit the CAP reform decision on 26 June, before Cancun, the European Commission has clearly underestimated the refusal of the third countries to tolerate anymore what can be considered as a Euro-American « swindle » imagined at the beginning of the 1990s: decreasing the internal agricultural price to reach the world price and combine it with direct payments (de-coupling), with the maintained intention of strong exports to the world market and “laundering” this new system thanks to the creation of the green box.
The staple farm produce from the EU and USA go on being exported with an excessively low price, artificially curbed by direct payments and often under the production cost. What the EU calls « reinforcing the competitiveness on the world market » is nothing but an artifice linked to shifting the export direct aid -which disappears with the decrease of the European price- towards the direct payments intended for a green box which is only accessible to the rich countries.
The European Union has a great responsibility in the development of an international debate which tends today to put all the public support to agriculture into one and same basket (that has to be eliminated). Public support to agriculture may well be legitimate, for instance for a sustainable family farming to exist in all the regions, provided that this support is not used for low price exporting. Yet this is exactly the very core of the CAP reform implemented today. It is not possible to have a solid economy if it is based on providing products under the production costs.
In actual facts, the present rules of international trade and CAP have a stake for the agri-food business and the mass marketing since they can get low price supplies in Europe, but also increasingly in the East or the South where they have their relocated subsidiaries (see the French company Doux in the poultry sector). These two powerful economic stakeholders are the ones who need first to have “access to the” EU “market”. The relocation of the farm production outside Europe is on the move and the EU is tempted to transform this into bargaining chips during the WTO negotiations.
One example is the animal feedstuffs that has been imported since 1962 without customs duty: the EU has given up its plan for plant protein production (dependency higher than 2/3). The massive imports of animal feedstuffs are the main reason for the existence of the European animal and cereal surpluses, and for these latter the EU does not have any export vocation.
The European Commission presents the CAP reform as a favorable reform for environment and animal welfare. Yet the intensive and industrialized production of poultry, pig, bull-calf, calf and milk, based on massive animal feedstuffs imports, has not been curbed, and these last ten years decoupling between the actual cereal production and the direct payment has not reduced the amount of pesticides in the underground waters. Producing with the lowest possible price cannot guarantee the multifunctional feature of agriculture, claimed by the EU population. For that purpose, the over intensive production methods have to be changed, since they have many negative functions.
The CAP must be legitimate in the eyes of the European tax payers. Therefore it is not possible to maintain a very uneven distribution of the public funds in favor of the big farms, of some sectors, of some regions. Yet the June reform maintains the inequalities.
The CAP is therefore to be reviewed. The issue is not to come back to the CAP of the first years: after 1962, providing support to farm prices without any volume threshold, granting export aids, giving up the Community preference for animal feedstuffs and the absence of supply management have led to : the development of mountains of surpluses, over-intensive farming, production concentration, and dumpling vis-à-vis the third countries.
Today the EU must get out of these contradictions and stop doing the contrary of what it says : let us dare developing a sustainable family farming, as the population claims for it, which is multifunctional and non distortional on the world market. It is a matter of survival for the very European agriculture.
Our proposals are based on several strong ideas and principles:
– The European Union would benefit a lot by maintaining the sustainable family farming, not only for guaranteeing food supply (food security), but also as regards the social and multi-functional role of agriculture. The present trend must be reversed: instead of concentrating the farms, an important fabric of small and medium-sized farms should be maintained, since they play an irreplaceable role in the following fields: a quality and diversified food production, landscape upkeep, wood and forest clearing, human territory occupation, etc. Maintaining the number of people working in agriculture is not a sign of economic “backwardness” but an added value.
– Each State or union of States has the right to define their farm and food policies, as long as they do not disturb the international market: this is what is called food sovereignty.
– Any form of direct and indirect export support below their production costs (dumping) should be prohibited.
– The CAP priority should be to meet the needs of the internal market, and it may not be drafted anymore for meeting the export interests first.
– In order to maintain agricultural farms viable on the long run, their income should be based on the selling of their own products: agricultural price should become again the income’s core element.
– For the farm public support to have a strong social legitimacy, it must be distributed in a fair way among the different farms, sectors, countries, and the production methods should be sustainable.
For the CAP to be consistent, sustainable and legitimate, different levels of proposals must be associated and jointly implemented.
– Farm price / income / external exchanges
– Supply management / production methods /food security / health
– Regional balances / rural world
– Dumping free international agricultural trade
1 . Maintaining a family farming without disturbing the international market: agricultural prices, income, external exchanges, ….
We have seen (page 2) that the EU does not have an export vocation for staple animal products, milk and cereal. Therefore the export driven trend, through the decrease of the internal farm prices, may well be given up. It is possible then to prioritize the internal market, remove all export aid, and manage the supply on the internal market.
If consumers want to maintain an agricultural production in Europe, then farmers should be kept on this continent. For that purpose, since production costs are higher in the European region than in many other regions of the world, the low price import market should be protected: this becomes legitimate as soon as the EU stops its low price exports. The EU sets up then a Community preference level for all the farm produce, including animal feedstuffs, which will be used as an orientation price for the European market. This level is linked to an average European production cost meeting sustainable production conditions, and it is to be reviewed on a regular basis.
If the European citizens and tax payers want to keep the farmers in all the regions, including the less favored areas, they must allow them to produce, while supporting through direct payment the difference between the higher production cost and the level chosen for the Community preference. The EAGGF pays then price complements under the shape of direct payments, regrouped in one single payment per farm, with a ceiling determined according to the number of people working on the farm, taking into account the different products of the farm.
To sum up, the income linked to farm production is first made up of the products’ sales, thanks to a European market price linked to the European production costs, to which a direct payment can be added, variable according to the regions.
For the European market to be able to maintain such an oriented farm price, it is of course necessary to manage the production supply.
2. Managed production supply, sustainable production methods
The objectives of sustainability and supply management are intertwined.
Taking into consideration the important costs of the over-intensive agricultural production methods for society, it is necessary to dis-intensify these over intensive farms. What is needed is a transition period where a financial support is provided to the small and medium-sized farms allowing the implementation of the following measures and instruments (non exhaustive list):
– animal production should be linked with the fodder area of the farm (maximal density): progressive renunciation of industrial animal production,
– strict application of nitrates directive (to be improved),
– prohibition of antibiotics in feedstuffs,
– prohibition of straw shorteners,
– to encourage the farms to use less inputs, to practice the rotation of cultures, to replace silage-maize in Northern Europe by mixing grass with leguminous,
– to support irrigation only in dry zones, when groundwater is in not in danger, and for plants which need irrigation,
– to stop public support for drainage,
– to support the farms which respect stricter environmental standards to preserve biodiversity,
– animal production standards which respect animal welfare: prohibition of batteries, limitation of time of animal transportation,..
– temporary specific support for production of plant proteins in animal farms,
– training and research directed to sustainable family farming.
These measures, dealing with dis-intensification, as well as the Community preference applied on animal feedstuffs, will eliminate the present structural surpluses of animal products and cereal. However, in case of circumstantial surpluses (sustainable farming remains dependant upon climatic factors), other complementary measures are necessary, such as establishing a minimum farm purchasing price for agri-food business and mass marketing.
3. To favour the regional markets and the local processing of products
EAGGF and structural funds should support local and regional markets, direct marketing at the farm (instead of promoting products for export), and small local food processing structures, (instead of supporting the concentration of slaughter-houses or the building of big infrastructures like harbours and highways).
If the sanitary and technical standards are not different from the industrial standards, it is not possible to maintain and develop family and small scale farm produce processing.
Decisions to decrease transport on long distance should be supported in the interest of the environment and food safety.
4. Quality and safety of agricultural products
– General ban of GMOs in food production, food processing, and import .
– The products authorized in animal feedstuffs should be registrated in a positive list, with full labelling regarding composition and origin.
– The emission and the presence of toxic products in food, such as dioxins, nitrofuranes, heavy metals and antibiotics, should be monitored in a stricter way and both these phenomena should be prohibited on the long term.
– Upstream and downstream food processing companies have to be made legally and financially responsible for the consequences of their industrial practices on human and animal health and environment.
– Quality standards should be revised giving priority to the interests of consumers and not of mass marketing.
– The industrial evolution of some protected products (AOP/IGP) requires revision of the European regulation of 1992.
5. for lively countryside
Without an active European policy which supports young and new people settling in farming, the countryside will continue to loose its farmers. We need urgently to:
• to ban any trade of production rights,
• to stop the repurchase of the farm by each generation (in some countries),
• to fix maximal investment ceilings rather than minimum economical areas for supporting settlement: we want
« rather neighbours than hectares ».
In order to limit the concentration of land into the hands of ever greater farms, the member States implement measures allowing the priority allocation of land for rent to small farms and people who want to settle as farmers.
To cure the present regional concentration of agricultural production, a re-localisation of the productions in regions where it is their natural or cultural vocation (where they have disappeared or regressed) is necessary : pig and sheep production in less favoured areas is a good example.
6. international trade without dumping
“Food sovereignty is the RIGHT of countries/unions of countries to decide their own agriculture and food policy, without dumping regarding third countries”- Via Campesina
The different regions of the world have regional products to exchange and the world needs fair rules for these exchanges. But this must be done without economic dumping (exporting below the production costs), or social and environmental dumping. Priority should not be given any more to exporting low price staple products, but to local and regional food production. It is a matter of narrowing down the international agricultural and trade negotiations to commerce and not to let them define the agricultural polices, as it is the case today.
The policy described above will put the European Union in a better position for negotiating and making alliances, since the EU would have abandoned direct and indirect export support. The EU would be able to better justify the Community preference and the right of all the countries / groups of countries to protect themselves from excessively low price imports.
The WTO does not have a place for defining the farm or the public services’ policies (health, education, water, energy, etc). The trade rules should be subordinated to the Universal Declaration of Human Rights and the international conventions on social and environmental issues. The UNCTAD, in connection with the FAO, should be reinstated in their functions in order to deal with agricultural trade rules, and an international independent legal body should be set up in order to settle the trade disputes.
III. Immediate measures
1) A fairer allocation method of the direct payments among the farmers
The historical basis chosen for setting up the direct payments is not legitimate for the tax payers, who in this way go on financing mainly the big agricultural and animal farms. It is necessary to rebalance the public support among all these farms, production sectors and countries, focusing the support mainly on the small and medium-sized farms, which guarantee an alive countryside. A ceiling for direct payments per farm is indispensable, taking into account the number of people who work on the farm.
2) Banning any sale value for the rights to produce and the rights to direct payments
(see item II. 5), which favor speculation and make things even more difficult for people who want to settle as farmers.
3) Adopting the Zero GMO contamination rate for seeds, otherwise GMO dissemination will be unavoidable.
4) Maintaining the GMO moratorium
5) Not increasing the European dairy quota, since the EU has already a surplus in this sector.
6) In case of circumstantial crisis, adopting minimum farm produce purchase prices for agri-business and mass marketing.