Buying grain into intervention may be intended to be a safety net under the new look CAP, but it is a safety net that has been much needed this summer. This in spite of the fact that much of Europe has been afflicted by a drought that is estimated to hit crop yields by seven per cent. In Spain and Portugal, where the drought is at its worst, the Commission has approved emergency aid to farmers.
As last year, the surplus production is mainly in central and eastern Europe. By the end of June, the EU had almost 12 million tonnes in intervention with another four and a half million tons under offer. Although it was possible to export some of the stockpiled grain, storage space is at a premium.
The total bill for cereals intervention this year could be almost €500m, almost eight times the original budget. Money has to be clawed back from other underspent parts of the CAP budget.
Incidentally, this page has just returned from a trip through five central and east European states, two already EU members, two candidates and one (Serbia-Montenegro) still in ill favour. Impressionistically, I thought that Bulgarian agriculture and infrastructure looked in far better shape than in Romania where the horse (or the mule) is still very much in use as a means of transport.