Farmers in all sectors should see their bargaining power boosted, farming rules simplified and be better equipped to deal with market challenges and production risks, the Agriculture Committee said in a vote on Wednesday. MEPs also want the Commission to table a law against unfair trading practices in the food supply chain.

Agriculture MEPs approved an opinion on the so-called Omnibus regulation for the Budgets and Budget Control Committees, who share the lead on the file, by 34 votes in favour to 10 against, with one abstention. The draft law on the financial rules applicable to the general EU budget amends inter alia several core components of the EU’s Common Agricultural Policy (CAP), such as crisis and risk management tools and definition of active farmer, to make them more up-to-date and easier to apply.

”The opinion approved today by the Agriculture Committee shows that the approach of the European Parliament to the Omnibus proposal is much more ambitious than those of other EU institutions. Together with my co-rapporteur Albert Dess we decided to focus on three guiding principles for our work: simplification, organisation and risk management. Building on these, we sought to provide our farmers with tools that would be immediately available if they need them, which is particularly important in current uncertain times,” said rapporteur Paolo De Castro (S&D, IT).

“We urgently request the European Commission to propose an effective regulatory framework to tackle unfair trading practices and safeguard farmers’ interests in the food supply chain”, said rapporteur Albert Dess (EPP, DE). “We also want to increase the support for small farmers to up to €2,500, as compared to the current ceiling of €1,250, and we insist that current rural development programmes continue to apply until 2024 to provide farmers with certainty they need,” he said.

“We also found a practical solution for permanent grassland to make life of farmers easier. Land leased as arable land and converted into grassland can now be returned at any stage to its original status, independent of the five year rule”, Mr Dess added.

Strengthening farmers in a fairer supply chain

Members of the Agriculture Committee insist that farmers’ bargaining position in the food supply chain must be boosted, producers must be allowed to join forces when negotiating delivery contracts without breaking the EU’s competition law, and unfair trading must be outlawed on the EU level.

To this end MEPs want to:

  • extend the mandatory recognition of producer organisations that fulfil set criteria from the milk to all other sectors,
  • allow all recognised farmers’ organisations to plan production and negotiate delivery contracts on behalf of its members without falling foul of the EU’s competition rules. Collective negotiations are currently allowed only for milk, olive oil, beef, cereals and protein crops producers, and
  • oblige the EU’s executive to come up, by 30 June 2018, with a draft EU law to combat unfair trading practices in the food supply chain.

Better tools to face market and production risks

In the aftermath of series of agricultural crises in recent years MEPs insist that farmers need better tools to protect themselves from both market volatility and unforeseen production risks such as adverse weather conditions, plants pests or animal diseases.

To this end MEPs want to:

  • update rules on crop, animal and plant insurance, mutual funds and the income stabilisation tool (IST) to increase compensations and make them accessible to more struggling farmers. Compensation of up to 70% (currently 65%) should be available to farmers who lost more than 20% (currently 30%) of their annual production. The Commission proposed the same measure but only for losses covered by the IST,
  • make IST sector-specific so that losses incurred by farmers would be calculated for the type of production that was hit and they could be compensated even if their other productions did not suffer,
  • extend the existing scheme, which grants aid to dairy farmers who voluntarily reduce supply of their geographically protected products (PDO and PGI labels) in times of serious market imbalances, to all other sectors,
  • untie the Commission’s hands in times of crises by allowing it to move quickly with exceptional actions without the need to activate first the public intervention and private storage measures,
  • allow for coupled support, currently limited to sectors or regions struggling with maintaining previous levels of production, automatically to the protein crops sector.

Active and young farmers: More flexibility introduced

MEPs endorsed the Commission’s proposal to give member states more flexibility to define an active farmer, i.e. a person eligible for EU farm subsidies. But they strictly opposed the suggestion to allow EU states to do away with the definition completely as of 2018.

The committee wants to allow member states to increase young farmers’ top-ups from 25% to 50% of the basic payment entitlement, but within the same range of first hectares (25 - 90). The top-up should be made available also to farmers under 40 years old who have already been farming for some time and so are not just setting up their business, but only if they have not been in receipt of young farmers’ support until now, says the approved text.

Next steps

The opinion of the Agriculture Committee will now be forwarded to the Budgets and Budgetary Control Committees, which have the lead on the file. Their MEPs intend to vote on the draft legislative resolution during the 30 May joint committee meeting.

The Agriculture Committee has an associated status on this draft regulation. This means that its amendments should be automatically accepted by lead committees and once given a green light by the Parliament per se, Agriculture Committee negotiators should lead trialogue talks with the Council and the Commission on CAP-related aspects of the draft regulation.

Wednesday, 3 May 2017

Committee on Agriculture and Rural Development

In the chair: Czesław Adam Siekierski (EPP, PL)


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