April: highlights in chronology

09/04 Preparation of the European Council in June by the European Affairs Ministers: persistent divergences for the future CAP budget

15/04 Some ministers reiterate call for solid budget

full note available on FE members area 

• European Parliament: Comagri operates a major community reframing of the reform project

March was marked by the elaboration of the drafting of the compromise amendments by ComAgri MEPs on the three texts of the reform rapporteurs, to reinforce the commonality of the rules, as well as alternative amendments. These amendments are put to the vote on 1 April (single CMO), 2 April (strategic plans Pillar 1 & Pillar 2) and 8 April (horizontal regulation) respectively.

The Members of the agricultural committee of the European Parliament adopted yesterday and today the two first reports on the Common Agricultural Policy reform (proposal on National strategic plans, and single CMO). The amendments voted by the COMAGRI MEPs significantly improve the initial proposal of the European Commission. 

Despite the tight schedule, the Committee gave a strong orientation to the next CAP, striking the right balance between economic and environmental performance and between flexibilities and common rules.

Among the orientations given by the MEPs on the strategic plans, the flagship decisions are:

• the definition of the parameters for the financial allocation of the first pillar, with 60% for basic payment support and redistributive payment, 20% for the ecoscheme and 10+2% for coupled support in addition to 3% for sectorial schemes;

• a proper cross-compliance with clear EU rules and the possibility for Member States to propose equivalent measures, which guarantees a level playing field across Europe while offering the possibility for a real simplification;

• a balanced allocation of the second pillar targeting at least 30% to environmental objectives (including a maximum of 40% of the allocation for less favoured areas supports) and at least 30% to investment and risk management tools;

• on internal convergence: at least 75% of average direct subsidies by 2024 and 100% by 2027;
• a support to digital and precision farming via investment incentives which are necessary to accompany a forward-looking EU agriculture;

• a capping at €100.000 (possible deduction of 50% of agriculture-related salaries), unless the Member States implement a 10% redistributive payment;

• a limitation at 15% of financial transfers from 1st to 2^nd pillar and 5% from 2^nd to 1st pillar.

• compulsory redistributive payments of at least 5 % in each Member state,

• Deletion of EFAs provision from the new conditionality (cross compliance), minimum EFAs to be defined by MS and inserted in eco-schemes.

• implementation of the CAP reform postponed – at this stage – to 2022.

When it comes to the single CMO, the Committee set in the Regulation:

• the possibility for reduction scheme as successfully implemented in 2015-2016 to cope with the milk crisis;

• improvements in the competition rules to further encourage farmers’ organisations;

• extension of the Regulation tools for the wine sector to 2050 and a good compromise for wine labelling.

The next step will take place next week on April 8th, with the vote on the 3rd Regulation of the CAP reform, tackling financial management, audit and controls rules. This Regulation is a cornerstone of the CAP reform proposals. It will be of the utmost importance for the MEPs to guarantee that the CAP does not turn into 27 different national frameworks without a solid EU framework. In the meantime, this Horizontal Regulation must set the parameters and provide financial capacity to the CAP to react effectively in case of crisis, via a reformed crisis reserve.

• Member States: Delegations that refuse to enter the negotiation process pending budget decisions.

• Positions of Member States in the SCA on the voluntary or mandatory nature of measures of the strategic plans and on the performance framework
• An Agricultural Council which revealed the reluctance of Member States to negotiate in a piecemeal way the texts of the reform, in particular in the absence of visibility on the MFF
• The request from the Member States for a transitional regulation to ensure continuity of aid in 2021, when the delay of entry into force of the new CAP is now recognized by the Commission itself

full note available on FE members area

This month started with the awaited votes of the European Parliament’s Agriculture Committee (ComAgri) on negotiation positions on the CAP post-2020 reform package, namely the new EU rules for the Common Market Organisation in agricultural products (April 1), the CAP Strategic Plans (April 2) and the Horizontal Regulation (April 8).

In terms of wine market dynamics, latest figures presented by the OIV show that world wine production in 2018 reached a record of 292.3 mhl, which represents an increase of 42.5 mhl since 2017 and close to the high level of 2004.

Organic wine consumption worldwide is expected to show a rapid increase in the coming years. This is mainly due the rapid growth of consumers’ attention towards environmental sustainability and wellbeing. European markets will play a major role in this evolution, with Europe expected to account for 78% of organic wine consumption in 2022.

Climate change is having and will continue to have major impacts on vineyards, that’s why the sector needs to react and focus on the most effective solutions.

Finally, as part of a dispute with the EU at the WTO over subsidies for the aerospace industry, U.S. President Donald Trump threatened to add additional import duties on a series of agri-food products, wines included.

full note available on FE members area 

Persistent concerns but mainly doubts over what the ECJ ruling on NBTs actually means in concrete terms for Member States, are far from being exhausted. At the same time, many research projects of gene-editing adoption in both crops and farm-animals are taking place on both sides of the ocean.

A recent study requested by the European Parliament highlighted the potential of CRISPR-Cas9 approach as being “a substantial contribution towards a better targeting application and reduction of herbicides, fungicides and insecticides”.

News from abroad: new genome-editing technique discoveries which go beyond established methods and target commercial crops varieties show the first promising results.

Finally, few weeks ago, EU Health Commissioner Andriukaitis stated once again his opinion on New Plant Breeding Techniques, which, he said “need a new regulatory framework that takes into account the latest advanced technologies”. A similar reaction also from the EP side by MEP Paolo De Castro, who declared that genome editing is going to be “high” on next Parliament agenda.

full note available on FE members area 

The Member of the Agricultural Committee voted on April 8^th the Horizontal Regulation which is the cornerstone of the reform package of the Common Agricultural Policy (CAP) proposed by the Commission.

The concept of a new agricultural reserve, well-funded and more reactive, has been endorsed by the EP Committee by a wide majority. Such a crisis reserve financed with up to 1,5 billon EUR would allow the CAP to cope with major crisis and would help in developing stronger and more targeted risk management tools across Europe. This crisis reserve would aim at triggering market measures in case of serious market disturbances. Furthermore, it would work as a re-insurance for the Income Stabilisation Tool to be developed by farmers in the future with support available from the CAP 2nd pillar.
The reserve should be financed in addition to direct payments from the CAP and rural development funding. Its initial budget should be 400 million euros, while other funds could be added each year as well as unused funds from previous years, up to 1.5 billion euros. If this were not enough, the mechanism of financial discipline should be activated, but only as a last resort and excluding the first 2000 euros of payments.

full note available on FE members area

The Member of the Agricultural Committee voted today the Horizontal Regulation which is the cornerstone of the reform package of the Common Agricultural Policy (CAP) proposed by the Commission.
Farm Europe is delighted to see that the concept of a new agricultural reserve, well funded and more reactive, has been endorsed by the EP Committee by a wide majority. Such a crisis reserve financed with up to 1,5 billon EUR would allow the CAP to cope with major crisis and would help in developing stronger and more targeted risk management tools across Europe. This crisis reserve would aim at triggering market measures in case of serious market disturbances. Furthermore,  it would work as a re-insurance for the Income Stabilisation Tool to be developed by farmers in the future with support available from the CAP 2nd pillar.
All agricultural sectors, including crop farmers and beef producers are in real need of a proper crisis management “toolbox” at EU level. In the very short term, for dairy farmers and the sugar beet sector such tool could be a real game changer, allowing the supply chain to have more visibility and to better protect the producers’ income against volatility. To ensure the effectiveness of this renewed system, Risk Management tools and Crisis management at EU level should be used in a complementary way in the  future. Something that would be both cost effective for public spending and economically efficient to protect farmers in a volatile world.

Beyond the crisis reserve, the amendments to the Horizontal Regulation proposed by the European Commission and adopted todayby the EP Agricultural Committee go in the right direction, by improving the Common framework for audits and controls and limiting the risk of a renationalisation of the policy. In particular the MEPs’ vote guaranteesa level playing-field, which setsEU standard for both audit and sanctions and definesa clear conformity system to be implemented in each Member state and controlled by the Commission. These arebasic conditions for a truly Common CAP, able to demonstrate its efficiency both financially and “on the ground”to all taxpayers and citizens.

The Members of the agricultural committee of the European Parliament adopted today the two first reports on the Common Agricultural Policy reform. Farm Europe welcomes these votes which significantly improve the initial proposal of the European Commission.

Despite the tight schedule, the Committee gave a strong orientation to the next CAP, striking the right balance between economic and environmental performance and between flexibilities and common rules.

Among the orientations given by the MEPs on the strategic plans, the flagship decisions are :

–       the definition of the parameters for the financial allocation of the first pillar, with 60% for basic payment support and redistributive payment, 20% for the ecoscheme and 10+2% for coupled support in addition to 3% for sectorial schemes ;

–       a proper cross-compliance with clear EU rules and the possibility for Member States to propose equivalent measures, which guarantees a level playing field across Europe while offering the possibility for a real simplification ;

–       a balanced allocation of the second pillar targeting 30% to environmental objectives (including part of less favoured areas supports) and 30% to investment and risk management tools ;

–       a support to digital and precision farming via investment incentives which are necessary to accompany a forward-looking EU agriculture ;

–       a capping at €100.000 unless the Member States implement a 10% redistributive payment ;

–       a limitation at 15% of financial transfers from 1st to 2^nd pillar and 5% from 2^nd to 1st pillar.

When it comes to the single CMO, the Committee set in the Regulation :

–       the possibility for reduction scheme as successfuly implemented in 2015-2016 to cope with the milk crisis ;

–       improvements in the competition rules to further encourage farmers’ organisations ;

–       extension of the regulation tools for the wine sector till 2050 and a good compromise for wine labelling.

The next step will take place on April 8th, with the vote on the 3rd Regulation of the CAP reform, tackling financial management, audit and controls rules. This Regulation is a cornerstone of the CAP reform proposals. It will be very important for the MEPs to guarantee that the CAP does not turn into 27 different national policies without a solid EU framework. In the meantime, this Horizontal Regulation must set the parameters and provide financial capacity to the CAP to react effectively in case of crisis, via a reformed crisis reserved.

By a very large majority the European Parliament has adopted the Unfair Trading Practices Directive within the agri-food supply chain. Farm Europe commends the work done during this term by the European Commission and the European Parliament, in particular at the instigation of Paolo De Castro and Mairead McGuinness, who played a key role in raising the level of ambition of the initial text. This directive will be the main step forward for the agricultural and agri-food sector during this term of office – alongside the Omnibus which has made it possible to update the CAP.

The Directive will apply to anyone involved in the food supply chain with a turnover of up to 350 million euros and differentiated levels of protection provided below this threshold. The new rules will apply to retailers, food processors, wholesalers, cooperatives or producer organizations or a single producer who engages in any of the identified unfair trading practices.

Prohibited UTPs – initially limited only to perishable products (payment after 60 days) – have been extended to cover: late payments for perishable food products (payment after 30 days); cancellations of last minute orders; unilateral or retroactive contract amendments; forcing the supplier to pay for wasted products and refusing written contracts. Other practices will only be permitted if they are subject to a clear and unambiguous prior agreement: a buyer returning unsold food products to a supplier; a buyer charging a supplier to guarantee or maintain a food supply agreement; a paying provider for a promotional, advertising or marketing campaign of a buyer.

Member States will be able to extend the scope of the Directive into national law, in particular by adopting a threshold of more than EUR 350 million or take additional measures if they wish so. It will be up to them to designate the authorities responsible for enforcing the new rules, including their ability to impose fines and initiate investigations on the basis of complaints. Confidentiality may be requested by the parties filing a complaint to address concerns about possible retaliation.

The Commission will put in place a coordination mechanism between the supervisory authorities to enable the exchange of good practice.

The agreement also includes a review clause set at 4 years. The provisions of the legislative text will therefore have to be assessed and possibly revised during the next term of Parliament.