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.
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The CAP has had explosive effects!



Pierre Boiteau, Frédéric Hénin, Terre-net


Article published in Terre-net



Beyond the raw numbers, farm income forecasts for 2013 made it possible to draw further conclusions, in particular concerning the evolution of the Common Agricultural Policy (CAP) over the past ten years.


CAP 2004-2013 ASSESSMENT: 10 BILLION IN LOSSES!

Picture all French farms a single company, the “French Farm”. In 2013, compared to 10 years ago, this company received up to six billion more in aid per year1. However, this aid did not consolidate farm incomes. Primarily it funded an increase in expenses. The “French Farm’s” added value, i.e. the wealth created by the farmers was losing up to 10 billion euros per year at the expense of their income. Finally, it was the demographic factor which served as the main driver for change in the income of active farmers. The decrease in the number of farmers from 2 to 4% per year has preserved the income of the “French Farm” from further decline or at least mitigated its magnitude because it is shared among fewer workers. The group “benefitting” most from this demographic phenomenon being the bosses of medium and large sized farms.


DISPARITIES AND MARKET VOLATILITY

Income disparities among farms have risen during the past 10 years in France, e.g. in 2012, the income of sheep farmers was three times lower than those of grain farmers. Within each sector there is increasing volatility, with variations in income of 1 to 2.5 in milk and meat cattle and of 1 to 4 in crop production from one year to the next.

Fluctuations in the annual incomes of grain farmers are now greater than those continuously observed in other sectors which traditionally received little support from the CAP, such as pigs and poultry. The CAP assessment in 2010 did not therefore have the anticipated effect of reducing the gaps. The boom years and rising grain prices simply transferred revenue from cattle farmers to grain farmers, food costs increased the revenues of the latter to the expense of the first, since compensation from consumer prices is not really feasible.


AND FOR THE REST OF EUROPE?

The economic crisis does not affect the income of most farmers. According to estimates by the statistical office of the European Union, Eurostat, real agricultural income per worker2 increased by 29.2% between 2005 and 2013 in the EU 28, while the agricultural labour force decreased by 20.8%. The differences between countries are related to the specificity of their agriculture.

For 2013, the agricultural income per worker grew in 15 Member States and decreased in 13. The largest increases were in the Netherlands (+11.4%), Romania (+10.4%), Spain (+10%) and Italy (+8.9%), and the most pronounced decreases were in Estonia (- 17.2%), France (- 16.4%), Croatia (- 16.2%) and Germany (- 10%).

France is suffering from one of the largest declines in income among European countries, probably because it has a larger share in crop production compared to its neighbours. And the future? There will be more in an upcoming issue of Terre-net Magazine ...


1 This is the increase in decoupled aid, paid directly to farmers to compensate for price reductions and other aid that appeared in previous common agricultural policies.
2 Across all categories (farmers, workers)

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Paris, 25 June 2018