Friday, September 26, 2008

Wait a minute

The Scottish farm minister Richard Lochead has firmly ruled out a demand from NFU Scotland for the early payment of £61m of less favoured area support. He pointed out that early payment would jeopardise the Single Farm Payment as EU rules state that SFP must be paid ahead of LFA support.

The Scottish NFU argued that early payment would provide some respite to farmers escalating feed, fertiliser and fuel payment. Many families are constrained by rising food, energy and petrol prices. Perhaps on the same logic child benefit should be paid out early?

In an editorial Farmers' Weekly calls for a 'coherent, joined-up plan ... from DEFRA, which encourages a scaling-up of UK food production'. It doesn't get much to get the farming community to fall back on a call for Stalinist five-year plans. Machine Tractor Stations anyone?

Those in farming tend to see the world rather differently from the rest of us. To be fair, there are progressive farmers who see the need to engage in a dialogue with consumers and respond to market opportunities. But all too often they are not the public voice of the industry.

Monday, September 22, 2008

Food security and CAP reform

A short overview article I have written on this subject can be read here:

New book recommendation

Whilst I have some reservations about plugging a book in which I wrote the concluding chapter (on 'Implications for Future Reforms'), I do recommend Johan Swinnen (edited) The Perfect Storm: The Political Economy of the Fischler Reforms of the Common Agricultural Policy published by the Centre for European Policy Studies in Brussels. You can now download it for free here:

It was based on an excellent workshop in Brussels which involved some of the Fischler insiders as well as academics. The result is, I think, one of the most informed and authoritative accounts of the Fischler reforms that we have available to us.

Tuesday, September 16, 2008

An exercise in decoding

France has produced a paper on the future of the CAP which is designed to stimulate discussion at the informal farm council to be held there in the Rhone-Alps region on 21-23 September. The paper is very vague, no doubt deliberately so, and interpreting has to be an exercise in decoding.

The paper argues that in the 'new context' of rising food and fuel prices, the future of the CAP should centre around four areas. The first of these is assuring food security in the EU. No suprises there, as France has been a vigorous adopter and champion of the revived food security discourse which provides a new underpinning for subsidy and protection.

New content can be placed in it, however, as is evident from a discussion on economic patriotism I participated at Science Po in Paris last week. The argument there was that even new market approaches could be brought under the economic patriotism umbrella.

The second objective is contributing to sustainable and balanced food supplies in the world. A laudable aim, but the EU has frustrated it by dumping surplus produce on the world market and undermining local suppliers, as well as frustrating the development of commercial agriculture in the Global South by placing barriers to entry around the European market. Hopefully, some of the worst of these practices are coming to an end.

The third aim is preserving the rural fabric and ensuring territorial cohesion, an objective close to French hearts with its emphasis on the cultural dimension of the CAP. The paper argues that the uniformity of Pillar 1 is in danger of stifling the diversity of the French agricultural landscape. Vulnerable areas, of which no doubt there are many in France, should get some sort of 'top up'.

The fourth objective is participating in the mitigation of climate change, which everyone is in favour of, but the challenge is how you actually do it, particularly in an economic downturn.

The most specific the paper gets is a call for less static support tools which a decoding suggests are favoured in part because they may be a way of getting around international trade rules. As well as providing support for integrated enviromental measures, these tools (whatever they might be) would be a means of dealing with increased market volatility.

This leads me to suppose that one might be talking about some modernised verision of deficiency payments, as used in Britain before it joined the common market. It may be, and this is just surmise, that the French think they cannot keep the SFP going beyond 2013, but they may be able to sell a subsidy that is linked to climate change and environmental benefits and also gives farmers some protection in hard times.

Whether such a vague document will lead to a structured or useful discussion at the informal Farm Council remains to be seen, but somehow I doubt it.

More information on the meeting is at Council

Saturday, September 06, 2008

Credit crunch hits organic food sales

Sales of organic foods to leading supermarkets in Britain are struggling, suggesting that when recessionary conditions hit shoppers are ready to sacrifice their green credentials in favour of cheaper food. According to TNS World-panel data, sales of organic produce at Sainsbury's fell by 3.8 per cent and at Tesco by 1.3 per cent in the three months to early August. Spending on organic produce in the whole market has fallen by 19 per cent from £100m to £81m this year.

Organic agriculture is inherently more expensive than intensive agriculture. However, the Soil Association insisted that what was happening was a plateau rather than a reversal. Year-on-year average growth over the last decade has been 25 per cent.

It is interesting that organic egg sales have taken a particular hit, falling by 18 per cent in the four weeks to end of August. Consumers think that they can still be ethical by buying free range eggs.

These market developments could offer an opening for Integrated Crop Management which offers a route to more environmentally friendly farming without going organic. It is, of course, remarkable how tolerant consumers are of the use of so-called 'traditional' compounds by organic farmers, but they may not be aware of their use. 'Organic' has certainly embedded itself in the public consciousness with a very favourable image.