Getting agreement on CAP is near impossible

Reflecting on the outcome of the CAP negotiations, NFU president Peter Kendall is critical of the decision-making process, saying that it is near impossible to reach agreement: Kendall. He makes a good point, but how could one start to change it, given the range of interests and institutions that have a stake in the way decisions are made?

Have farmers less to whinge about?

Sometimes I think that Farmers Weekly should be called Whingers Weekly. Often it's the weather - too hot, too cold, too dry, too wet. Admittedly, it is a challenge in the UK's variable climate. Then it's often prices (where dairy farmers have real concerns) or late payment of subsidies. After that it's vegetarians, defenders of the badger and opponents of GM crops (both of the latter two go way over the top on many occasions). Or it's retailer power, and that's where I have real sympathy with farmers. Let's hope the new supermarket ajudicator makes a difference.

Anyway the NFU has launched a new campaign to boost the image of British farming. Apparently the president is going to emulate the Jubilee by going up the Thames in a farm themed boat to the House of Commons: Farming

Last year farming was one of the most profitable industries in the UK, lifting aggregate net profits 25 per cent to £5.7bn. Measured against other sectors only mining and oil saw bigger growth according to UBS, the investment bank. Of course, farming can have bad years as well as good and not all sectors are doing well, but it does lead one to wonder whether such large blanket subsidies are needed.

As NFU presiden Peter Kendall points out, modern farms make a great deal of use of ICT and 'It's now a high-tech industry, not the way it was 10 years ago.' Pardaoxically, consumers may like a more bucolic image, but then they also want a ready supply of cheap food.

The good times may also be over before they beagn. Farming is fossil fuel intensive and in the long run prices are likely to rise in real terms despite the current dip. Farmers do, of course, pay a lower level of duty on 'red' diesel (sufficiently lower to lead to its occasional illegal use). Supplies of grain are rising which is likely to depress prices. Turmoil in the eurozone may hit exports and the rise in the value of the pound will reduce the amount received in subsidies. However, demand for food is likely to continue to rise, pushing up prices.

Initial win for France

France has won the first round of the CAP budget negotiations with the Commission recommending that the farm budget should be frozen in real terms up to 2020, although additional provision would be made for the accession of Croatia and a €500m 'crisis intervention fund': Budget

Of course this is only the first stage in a long battle. The budget plans also assume a 5 per cent increase in the overall budget at a time of fiscal austerity and the UK has made it clear that it will oppose this increase. If it went ahead it would shrink the CAP share of the budget from 45 per cent to 38 per cent despite the total farm envelope being protected.

This budget recommendation might seem to confirm the view that French educated farm commissioner Dacian Ciolos is in the pocket of Paris. NFU president Peter Kendall recently criticised him for favouring a bucolic view of the countryside that promoted small, traditional farms (which are numerous in Romania) Mr Kendall said that Mr Ciolos had taken a 'Lark Rise to Candelford' view of agriculture which was old fashioned and shunned development.

There are concerns that the complexity of the changes proposed for the CAP and the delays which result from co-decision mean that any new package will not be brought into place by the target date of 1 January 2014. It might have to be delayed for one year.

It has become increasingly evident that the CAP in its current form will outlive me but I wonder if it will also outlive my granddaughter who starts secondary school in September.