The percentage of the financial discipline adjustment rate necessary to respect the budget ceiling is currently being proposed at just under 5 per cent.
NFU SPS adviser Richard Wordsworth said: “The financial discipline mechanism will hit UK farm payments, but because the factors affecting final reduction are still to be ironed out we cannot predict the precise impact.
“However, it is clear that the proposal to apply the adjustment to amounts in excess of €5000 would disproportionately impact on Member States that historically have a larger farm structure. The NFU believes that placing the burden of this adjustment on farmers based on size is unfair at the European scale and would prefer no threshold for any adjustment.
“To put the issue in some context, the exchange rate changes we have seen in recent times have had a far greater potential to impact these direct payments. For instance if the financial discipline mechanism reduces payments by just under 5 per cent, as proposed, and the exchange rate stays where it is at the moment, at 6 per cent above the 2012 rate, then farmers will not feel the impact.
“Clearly if the exchange rate deteriorates there is more chance of the financial discipline mechanism biting, but by the same token an improvement in the exchange rate will be beneficial to farm payments. But whatever happens it is an unwelcome development at a time when the industry is under pressure from many angles, not least the current weather patterns and that will hit the bottom line.”
Farm ministers agree CAP negotiating position
At midnight last Tuesday Europe's farm ministers agreed on a negotiating position for the future Common Agricultural Policy with an emphasis on flexibility over internal convergence and the ability to design and implement greening measures at a national or regional level. Irish farm minister Simon Coveney said: “We now have a clear direction and are on track for the political agreement by the end of June.” The position agreed by farm ministers will now form the basis for negotiation with the European Parliament which adopted its position on the CAP last week. Negotiations between the two institutions and the European Commission will commence on April 11 and around 30 “trilogue” meetings are expected to take place until June 30. Agriculture Commissioner Dacian Ciolos said the Irish presidency had done “a sterling job” adding he was “confident that we will be able to meet the tight deadlines over the next few months”. If all goes well The Commission, Council and Parliament are expected to sign off on a political agreement in July.
MEP hammers “unacceptable” Council proposals on CAP
The European Parliament's rapporteur on direct payments has hammered the Agriculture Council position on direct payments, stressing that tough negotiations lay ahead to find common ground. “Double funding is absolutely unacceptable. It destroys the legitimacy potential of the greening, by watering down environmental demands and by the possibility of granting a payment two times for the same purpose", said Luis Manuel Capoulas Santos. He added that Council’s suggestion to make the young farmer payment voluntary was “totally contrary to the EP mandate”. Mr Capoulas Santos also attacked the Council’s position to make capping voluntary. “The EP as the representative of EU citizens has taken a historically important decision on the capping of payments to farmers. It is highly disappointing to see that the Council has taken a different stand,” he said. The Portuguese MEP finished with a request to see figures on national envelopes before negotiations begin. “It has been more than a month and the EP rapporteurs on the CAP are still not aware of the figures…I will not sitdown at the negotiation table on these issues without information on what figures the Council has decided to put down,” said Mr Capoulas Santos.
Commissioner Barnier calls to strengthen the food chain
The bargaining position of farmers must be strengthened to reduce market volatility, Internal Market Commissioner Michel Barnier agreed with MEPs last week. He also said the EU must be better equipped to curb speculation on commodity markets as he answered MEP questions in the parliament’s agriculture committee. The EU must strive to ensure "transparency, traceability, quality and sustainability" in the food supply chain and deliver "more resilient farming in the face of market volatility", Mr Barnier told the committee. He added that "we need to regulate financial market speculation which can greatly accentuate the volatility of raw material prices". Many MEPs echoed these views, and several called for immediate action to stabilise the food supply chain and curb speculation. Mr Barnier also talked about the Commission’s Green Paper on unfair commercial practices, launched in January, and urged farmers and farming organisations to submit their evidence. EU farming body Copa-Cogeca is now preparing a detailed response to this.
Vote on neonicotinoid ban goes to appeal
Health and Consumer Affairs Commissioner Tonio Borg has confirmed that the European Commission's proposal to restrict the use of three neonicotinoids in order to protect bee health will be sent to an Appeals Committee. Brussels media reports suggest it could be discussed in the second half of April with a ban still possible in July. EU member state experts failed to reach an agreement on the proposed ban on March 15 after nine members voted against and five abstained, including the UK. Mr Borg told Farm Ministers last week: “As the next step, the Commission will now submit the proposal to the Appeal Committee, where we will further endeavour to find solutions which command the widest possible support.” He added that he was grateful to the UK for informing Farm Ministers that new field data would soon become available. “As indicated to the Standing Committee, the Commission will submit these data as soon as they become available to the European Food Safety Authority for assessment,” said Mr Borg. The UK had raised the issue of neonicotinoids as an Any Other Business item during last week’s Agriculture Council.
Member states call for better food labelling
France, Germany, Finland, Greece and Portugal have issued a joint statement on meat origin labelling in response to the contamination of beef meat scandal. The five member states called for the European Commission to draft legislative proposals on origin labelling for meat that included all types of meat irrespective of their percentage in the final product and the inclusion of information concerning the rearing and fattening of the animal and the place of processing. The Commission is expected to report its findings of an impact assessment later this year.
EU and Japan launch free trade talks
The EU and Japan this week officially launched the negotiations for a Free Trade Agreement (FTA). The aim is for a comprehensive agreement in goods, services and investment eliminating tariffs, non-tariff barriers and covering other trade-related issues, such as public procurement, regulatory issues, competition, and sustainable development. The first round of negotiations will be held in Brussels from 15 to 19 April 2013. Japan is the EU's 7th largest trading partner globally and the EU’s 2nd biggest trading partner in Asia after China. Conversely, the European Union is Japan’s 3rd largest trading partner, after China and the United States. An agreement between the two economic giants is expected to boost Europe’s economy by 0.6 to 0.8 % of its GDP and will result in growth and the creation of 400,000 jobs.
Green capital 2015 shortlist includes 2 UK cities
Bristol and Glasgow join Brussels and Slovak capital Ljubljana to complete the shortlist for the prestigious title of European Green Capital of 2015. Candidates were assessed in a range of fields include water use, sustainability, land use and biodiversity. The successful city will be announced at a ceremony on June 14 2013, hosted by the current European Green Capital, Nantes in France.