Common Agricultural Policy (CAP) & de markt

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The Common Agricultural Policy (CAP) and the Farm to Fork Strategy: what you need to know

The Common Agricultural Policy, the EU-policy that supplies income support for European farmers and promotes rural development, has been abundantly talked about lately. This week, the European Parliament is voting about the current proposal for the CAP reform, proposed by the European Commission. Critique has been outed on this proposal, by left and green parties and organisations. They claim that the proposal is a continuation of the previous CAP but does not make any progress when it comes to solving inequality between farms (because the subsidies are based on the scale of the farm) nor does it promote a more sustainable agriculture. In this CAP proposal, more flexibility is granted to the individual member states to adopt the CAP according to national priorities, which might be beneficial in some cases and cause further detriment of biodiversity and more insecurity for (young) farmers in other cases. The main problem here is that the current proposal has been made by the Commission in 2019, before the arrival of the ambitious Farm to Fork and Biodiversity Strategies discussed in 2020. The CAP reform should be an opportunity to kick-start these strategies.  Instead, it seems to become a demonstration of the EU’s inconsistent policy. The CAP accounts for around 38 percent of the EU expenditure, while it is now said to be heavily conflicting with the European Green Deal, which aims for a climate neutral Europe by 2050. It is time for a quick recap on these policies and strategies, ending with a look into the future and the actions being held to change it. 

 

  1.     What is the Common Agricultural Policy?

The Common Agricultural Policy is the European Union’s policy meant to support agriculture and rural development in the whole European Union, and consists of two pillars. The first pillar grants financial support to farmers. The amount of money a farmer receives, depends on the amount of land the farmer uses, and the country he or she is in. The second pillar involves rural development and agri-environmental measures and is co-financed by the member states. It supports young and new farmers, farmers who have a disadvantaged geographical position and encourages farmers to make their practices more environmental-friendly.

CAP Pillars What is it about?
  1. Financial support to farmers
  • Amount of money farmer receives
  • It depends on size of land/farm
  1. Rural development & Agri-environmental measures
  • More environmental-friendly practices
  • Support young and new farmers
  • Helping farmers with geographical limits

 

 A short history of the CAP

The Stresa Conference, in July 1958, laid the foundation for the CAP, a policy instrument based on the principles of market unity, community preference and financial solidarity. An import levy and an export refund were set in place, to grant European farmers a good position on the international market. The productivity increased, causing an overproduction and the CAP budget was mainly used to export this overproduction, which became more costly as the amount of overproduction increased.

In 1992, the MacSharry Reform forever changed the CAP, which would now offer direct income support to the farmer. The payments were based on what the farmer produces and the amount he produces. In 2003, the income support was decoupled from the production, but the amount the farmer produces per hectare was still held as a historical benchmark. This means that farmers in intensive agricultural countries in the 1990’s, like the Netherlands and Cyprus, still receive more financial aid per hectare than countries that had extensive agriculture between 1992 and 2003.

In 1999, the Common Agricultural Policy was divided into the two pillars (see image 1), as mentioned above. 

 

Image 1: European Commission, The common agricultural policy at a glance.

 

During the reform of 2013, the Greening Payment was introduced, where 30% of the national available money is conditioned by the provision of sustainable agricultural practices. As the CAP is reformed every 7 years, the European institutions are now debating the new CAP reform, which will shape European agriculture for the next seven years.

Today, the CAP maintains and increases inequality between farmers, as 80 percent of the direct payments goes to 20 percent of the farms, because the system benefits large-scale farms (Good Food Good Farming). In the proposal made in 2019 for the CAP reform, neither this inequality nor the lack of clear incentives towards nature-friendly farming are addressed.

 

  1.     What is the Farm to Fork Strategy?

The Farm to Fork Strategy and the Biodiversity Strategy are a part of the European Green Deal, which is a European initiative that envisions Europe as the first climate neutral continent in 2050. The Farm to Fork Strategy encompasses “advisory services, financial instruments and research and education” (EC, 2020) to reach the following goals, amongst others, to:

      reduce by 50% the use and risk of chemical pesticides by 2030

    reduce nutrient losses by at least 50%, while ensuring no deterioration of soil fertility and reduce fertilizer use by at least 20% by 2030

  increase organic farming until at least 25% of the EU’s agricultural land under organic farming by 2030 and a significant increase of organic aquaculture

      halve per capita food waste at retail and consumer levels by 2030

    propose mandatory harmonised front-of-pack nutrition labelling and develop a sustainable food labelling framework that covers the nutritional, climate, environmental and social aspects of food products (Source: Farm to Fork Factsheet)

The Farm to Fork entails long-term goals to ensure that the whole food chain has a neutral or positive environmental impact, whereas nowadays agriculture in the EU accounts for about 10 percent of  global greenhouse gas emissions. The strategy is a direct answer to the climate crisis and aims to mitigate climate change and help farmers adapt to the consequences. The loss of biodiversity is equally addressed in this regard.

The health crisis is another important instigator of the strategy. It is mentioned that in 2017, 1 out of 5 deaths in the European Union was attributed to unhealthy diets. The European Union is striving, with this strategy, to make the most healthy and environmental-friendly option also the most accessible and affordable option. This also relates to the point of animal welfare, which was noticeably one of the priorities on the agenda at the Farm to Fork Conference. All of these goals should be achieved while guaranteeing a fair price for the farmers’ products and maintaining the trade position of European products on the international market (Farm to Fork Strategy and Action Plan, 2020).

 

Image 2: EC, 2020

 

It is fair to say that this is, in light of where we are today, a progressive strategy that many of us will agree with. The only question that lingers now is: how?

During the Farm to Fork Conference, organized by the European Commission to present and discuss the strategy, it was clear that a lot of focus is dedicated to the consumer. The panel speakers included several European Parliament members, a Special Envoy of the UN Secretary-General, and a WWF representative, but there were no farmers as key-note speakers. There seemed to be a consensus that change in the food system comes for the demand-side and should be enabled by policy. Labelling is seen as essential in this regard: the consumer needs to know what is healthy for themselves and for the planet. These sustainable options should be made the most affordable ones, and be made more widely available. As a participant, the only actual discussion between panel members that I witnessed on the first day of the conference was about the denomination of plant-based products, and whether plant-based “burgers” can be called “burgers” on the packaging. In favour was the director general of the European Consumer Organisation (BEUC), who stated that research shows that the consumers do not  mind, and it is helpful to accelerate the transition towards more plant-based diets. Against was Pekka Posonen, the secretary-general of Copa-Cogeca, the agribusiness lobby group. Greta Thunberg used the meme below to raise the point that in debates about the European policy, a lot of attention goes to the point of denomination of vegan products, while the discussion about the incoherence between the CAP and the Farm to Fork Strategy was not held. 

Image 3: instagram post by Greta Thunberg

  1.     The EU Green Deal and the CAP: demonstrating an incoherent policy?

The CAP reform, voted this week in Parliamnet, is currently heavily discussed by environmental organisations, farmers’ organisations and the media, because of its lack of ambition on several levels. Green parties and a number of civil society organisations are positive that the current proposal for the CAP reform is not sufficient to steer us towards a greener and fairer food system. Furthermore, a report by the Corporate Europe Observatory has shown through leaked documents that the agribusiness lobby group Copa-Cogeca and others are actively pushing for a quick CAP deal, while trying to delay the implementation of the Farm to Fork Strategy.

It is obvious that many interests are interlaced when it comes to changing the whole food system in the European Union. Without a doubt, it is difficult to steer the CAP away from scale-based direct payments and towards supporting the livelihoods of all farmers while encouraging a more  resilient, fair and sustainable agriculture. However, it is also made clear by the European Commission itself that the time to change is now.

The Good Food Good Farming campaign, which is supported by a number of organizations and NGOs (such as Friends of the Earth, Voedsel Anders, Pour une autre CAP, IFOAM etc.), published an open letter to the the German Presidency of the European Union for the reform of the CAP in August 2020. The demands include a CAP reform that is compatible with the Farm to Fork Strategy, a higher ambition when it comes to animal welfare, environmental protection and social conditions. They also propose to “replace blind per hectare payments with the principle of “public money for public services” (including rural employment), shifting support to measures that enable farmers to invest in their agro-ecological transition, flanked by market-based mechanisms to improve economic viability, so that farmers can get a decent livelihood from their work as well as a greater weight in the value chain”. The movement called for an 30-day long international action during this month of October to address the problems mentioned above and motivate citizens to demand a fair, social, and future-oriented CAP from their national Members of the European Parliament.

Image 4: Action in the library of Wageningen University as part of the Good Food Good Farming Action Days

In 2018, 58 billion euros were invested in the CAP. This is public, European money. Farmers sometimes mention that they would like to not depend on the direct, European subsidies but it is a long way to a system where this income support is not necessary. Until then, the Common Agricultural Policy should function as a policy in line with the progressive goals that the European Union has set, and take a stance when it comes to environmental protection, the support of young or new farmers, animal welfare and public health. In the meanwhile, the European Union should invest in fair price policy, which also means limiting unnecessary international trade, to secure the livelihood of European farmers. 

Update: The European Parliament voted in favour of the proposed CAP for the coming 7 years, this means that 60 percent of the direct payments will continue to go to farmers without environmental conditions (The Guardian, 2020). 

What do you think about the Farm to Fork Strategy and about the Common Agricultural Policy? Let us know! 

Read further:

 

Boerengroep is closely following the discussion around the renewal of the CAP in 2021. Therefore we were present at the open consultation by the ministry of economic affairs on April 6th 2017. On May 11th we went to the international symposium ‘Who will fix the broken CAP’ in Brussels. Read our report hier inschrijven.

local economyTTIP- Free Festival in Wageningen, May 2016. “Long live the Local Economy”

infograph subsidies

  • Alternative Trade Mandate. Download hier inschrijven
    The Alternative Trade Mandate has been developed in extensive civil society consultations all over Europe. The Alternative Trade Mandate Alliance is an alliance of development and farmers’ groups, Fair Trade activists, trade unionists, migrant workers, environmentalists, women’s, human rights, faith and consumer groups from all over Europe, developing an alternative vision of European trade policy that puts people and planet before big business
  • Koning, 2006. Agriculture, development and international trade. Lessons to be learned from the Common Agricultural Policy of the European Union (Forum on Food Sovereignty, Niamey, 7-10 November 2006. By Niek Koning) . Download here..

  • Agriculture, society and the CAP: history and new challenges (lecture by Niek Koning). Download here..

  • Globalising Hunger: Food Security and the EU’s Common Agriculture Policy (CAP). 2010. Download pdf here..
  • FoodSovCAP, 2013. Commentary by he European movement for Food Sovereignty and another CAP. Read hier inschrijven
  • Proposal for a new European Agriculture and Food Policy. 2010. Download pdf here
  • Green Mercantialism? European progressives and the global food crisis. Niek Koning 2011. Read hier inschrijven
  • Koning and Van Ittersum, 2009. Will the world have enough to eat. Current Opinion in Environmental Sustainability. Download here..

  • Koning, 2007. agricultural Trade Liberalization and the Least Developed Countries. Download here..

  • Koning, 2008. Long term global availability of food continued abundance or new scarcity. NJAS Wageningen Journal of Life Sciences Download here..

  • Koning, 2010. Food Insecurity, Soil Degradation and Agricultural Markets in West Africa. Download here..

  • Koning, Agriculture and the WTO: time to reconsider the basics? Download here..

  • Koning, N., and Mol, A., 2009. Wanted. Institutions for balancing global food and energy markets. Download here..

  • High Food Price Crisis – List of reports by Oakland Institute. Read here..

top cap beneficiaries

  • Philip McMichael, 2009. A food regime genealogy. Download pdf
    Food regime analysis emerged to explain the strategic role of agriculture and food in the construction of the world capitalist economy. It identifies stable periods of capital accumulation associated with particular configurations of geopolitical power, conditioned by forms of agricultural production and consumption relations within and across national spaces. Contradictory relations within food regimes produce crisis, transformation, and transition to successor regimes. This ‘genealogy’ traces the development of food regime analysis in relation to historical and intellectual trends over the past two decades, arguing that food regime analysis underlines agriculture’s foundational role in political economy/ecology.
  • Documentary Fighting for seeds and soil
    Tanzania is at the forefront in the battle for control over Africa’s food system. With the help of the UK government (and others in the G7) corporations are scrambling to expand their markets in seeds, fertilisers, agrochemicals and land. But small-scale farmer organisations are fighting back by strengthening farmers’ knowledge of land, seeds and soil. Watch it here..

  • bilaterals.org  Initiated in September 2004 by the Asia-Pacific Research Network, GATT Watchdog, Global Justice Ecology Project, GRAIN, IBON Foundation and XminusY. What brought these groups together was a shared concern about the growth of bilateral trade and investment deals outside of the World Trade Organisation (WTO) and a feeling that these less visible agreements were “under the radar” of many social justice activists. The bilaterals.org website was thus conceived as a kind of collaborative clearinghouse on the internet where people could find and post their own information and analysis about bilateral free trade agreements (FTAs) and investment treaties being negotiated and signed across the globe, and who is doing what about them.
  • Fighting FTAs: the growing resistance to bilateral free trade and investment agreements. bilaterals.org, BIOTHAI, GRAIN (editors), January 2008. Read here..

  • ‘Regulatory Cooperation’: big business’ wishes come true in TTIP and CETA. Read hier inschrijven
  • TTIP and CETA – a threat to high-quality European agriculture, animal husbandry and food supply. Read online

 

==== CASH CROPS & FLEX CROPS ====

1. SOY

==== GREEN REVOLUTION ====

  • Patel, R. The Long Green Revolution. Download pdf