A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.
It brings together, managers from the agricultural world and important people from external perspectives,
such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
A look at the news

CAP instruments and reducing volatility:
Angélique Delahaye opens the way

May 16, 2016


Encouraging discussion and ideas on the potential role of risk management tools in the fight against volatility and stabilizing incomes in view of the future CAP: this is the objective of the draft report just released by MEP Angélique Delahaye on 9th May1. This will serve as a working basis for the members of the Agriculture Committee of the European Parliament. It will be officially presented by Angélique Delahaye on 6th June, before amendments and a committee vote scheduled for September and its adoption during a plenary session in December 2016.

We can only welcome the observation made by the Rapporteur: “Since 2007, global agricultural markets are characterized by extreme price changes, with increasingly more frequent and pronounced economic shocks”; “Price volatility generates uncertainty for agriculture and hinders investment”; “Global players in agricultural markets have established policies aimed at mitigating volatility”. Consequently, Angélique Delahaye believes that volatility should be regarded “as the norm” and that “the most exposed players should be accompanied in order to mitigate its negative effects”. In this context, Europe can no longer base its agricultural policy on decoupled direct aids “that are not adapted to situations of price volatility" as the objective “to stabilize markets” remains one of the CAP’s objectives.

For the CAP’s reorientation, Angélique Delahaye provides three key ideas: better organization of the sectors, the development of risk management tools and the continued implementation of price observatories. As this concerns risk management tools, the MEP considers that the measures “of the second pillar of the current CAP are notoriously inadequate” and calls for the development of “different types of insurance and mutual funds”. These should be “established by professionals” and are “more suited than direct payments”.

Finally, for Angélique Delahaye the distinction must be made between the management of volatility and crisis management. The current report deals only with the first aspect, as she “has decided not to broach the subject of counter-cyclical aid, understood to be crisis management measures”.

In their White Paper2, Momagri supports the implementation of counter-cyclical aids for the next CAP reform and considers them not only crisis management tools but also the basis for volatility management tools and a fortiori of crisis when this volatility is excessive. These aids which vary in function of prices, continue to demonstrate their effectiveness in the United States and Canada in particular. They should be introduced into the CAP, as called for by MEPs who have launched a think tank called “a new strategic direction for the CAP3”. Implementing counter-cyclical aid is even a sine qua non for the development of insurance and mutual funds which could only cover small economic losses. Because the risk of price fluctuations is systemic, i.e., it affects all producers at the same time, it is indeed difficult to insure. Insurers will not develop contracts on economic risk as long as the government does not treat heavy losses as a priority via countercyclical aid.


1 The entire draft report is available from
http://www.europarl.europa.eu/committees/en/agri/search-in-documents.html

2 The entire Momagri’s white paper is available from
http://www.momagri.org/UK/momagri-home.html

3 The opinion column of these five MEPs, Marc Tarabella (Belgium), Eric Andrieu (France), Jean-Paul Denanot (France), Nicola Caputo (Italy) et Tibor Szanyi (Hungary) is available from
http://www.lalibre.be/debats/opinions/un-nouveau-cap-strategique-pour-la-politique-agricole-(...)



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