Outcome of Agricultural Council of June 2002
European Commission - MEMO/02/159 28/06/2002
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Bruxelles, le 28 juin 2002
Outcome of Agricultural Council of June 2002
Political agreement on framework regulation on hygiene for foodstuffs (BG)
The Council reached a political agreement on the Commission's proposal on the hygiene of foodstuffs presented by the European Commission on 14 July 2000. Under this proposal food operators right through the food chain will bear primary responsibility for food safety. The focus is on setting objectives while leaving business flexibility to decide the safety measures to take, rather than prescribing them in great detail. The Council followed the Commission's proposal in providing for flexibility to accommodate the needs of food businesses that are situated in regions suffering from special geographical constraints and to take account of traditional methods of food production (see IP/02/948 of 27 June 2002)
Zoonoses and other zoonotic agents (BG)
The Commission and the Presidency updated the Council on the progress achieved on the proposals for monitoring and control of foodborne diseases, particularly emphasising the need to control salmonella. A large number of delegations support these proposals and it should be feasible to achieve a common position under the Danish Presidency (see IP/01/1167).
EU Veterinary Fund (BG)
The Presidency submitted a Memorandum in April on expenditure in the veterinary field, with a view to obtaining a debate on the system in place for funding animal disease control measures . The Council agreed on Presidency Conclusions.
BSE - Update on current situation in the EU (BG)
Commissioner David Byrne outlined to the Council the current state of play, highlighting that the overall incidence of BSE cases in the EU is stable and updating the Ministers on upcoming legislative proposals and scientific opinions. He made also reference to some national measures still in place in Europe, the incidence of scrapie, reports of the Food and Veterinary Office and the situation of meat-and-bone meal.
Medium term outlook for agricultural markets (GK)
Commissioner Fischler presented the latest market forecasts for agricultural markets. They depict a medium-term outlook for the main EU agricultural markets that would appear rather favourable for most products, with the noticeable exception of rye, rice and to a lesser extent- barley and poultry meat. "Yet this outlook remains subject to significant uncertainties.
These include notably uncertainties concerning the extent and size of world economic growth, and thus demand growth in the developing world, the medium-term outlook for the €/$ exchange rate and the impact of existing and future domestic and trade policies. In this respect, the new US Farm Bill, the Farm Security and Rural Investment Act of 2002, deserves some specific attention. Without prejudging the results of an in-depth analysis, the main elements of this assessment are as follows: The increased level of support under the new farm bill with respect to its predecessor, the FAIR Act, implies higher production levels in the US than what market prices would generate and should thus exert further downward pressure on world market prices. In the long-term, the capitalisation of support in land prices should increase US production costs and could lead to a deterioration of the financial situation of the US farm sector, thus generating an ever-increasing need for additional support.The greatest impact would be felt in the cereal sector where the new farm bill is expected to increase the competitiveness of US products. In contrast, US oilseed production may be foreseen to decrease somewhat, thus releasing some pressure from market prices. For the European Union, the largest impact is to be expected on the wheat sector, and, to a lower extent, on coarse grains and meat production.", the Commissioner underlined.
According to the report, EU competitiveness of cereals improves as a result of Agenda 2000, and combined with the moderate recovery in oilseed prices is expected to generate a further increase in cereal feed use over the medium term.
The market for rye is foreseen to display a continuous and structural imbalance, as prospects remain constrained by relatively high market prices and lack of market outlets. The annual surplus is estimated at approximately 15 % of production, and is projected to result to an accumulation in public stocks of some 13 mio t by 2009 (more than twice the projected level of production). Similar developments are expected in the rice sector, where the balance of the market is projected to deteriorate dramatically over the medium term and public stocks reach unsustainable levels.
Regulatory framework on synthetic alcohol (GK)
The Council discussed the Commission proposal. Mr Fischler said that the Commission was open to suggestions from Council and European Parliament to include synthetic alcohol into the framework and to change the name "Common Market Organisation". He however insisted that the Commission could not accept the exclusion of state aids (Article 10), as foreseen in the Presidency Compromise. "If the production of alcohol by the German farmers under the rules of the Monopoly, including Federal payments, is necessary for the maintenance of precious eco-systems or to cover extra-costs of environmental friendly production methods, the current state aid rules would offer substantial possibilities to grant aids for those purposes or aid schemes foreseen in Rural Development could be used. On the other hand, the Commission remains convinced that those small distillers that produce not only a raw alcohol but also produce and market directly a spirit could benefit from the de-minimis rule on state aid for non-agricultural products.", Fischler stressed.
The Council decided to refer the matter back to the SCA.
Protection of Greek Feta (GK)
The Council did not reach agreement on a Commission proposal to reinstate the registration of the name 'Feta' as a protected designation of origin. This implies that "Feta" cheese may only be produced in certain areas of Greece and respecting strict product specifications.
Producers in other Member States or not respecting these specifications will be given a maximum 5-year transitional period to change the name or to stop production. On the basis of an extremely detailed inquiry on the production, consumption, labelling and consumer perception of 'Feta' cheese in all Member States, the Scientific Committee concluded, in 2001, that the name is not generic. It had already earlier concluded that Greece had provided the requisite information for starting the registration procedure under the Regulation.
"Providing protection against usurpation of our multitude of European regional and traditional specialities as an important instrument to valorise our cultural heritage and to ensure that the revenues return to the people of the land that produce these specialities., Mr Fischler said.
In the absence of an opinion of the Council the Commission will now adopt the proposal according to the rules on Comitology.
Risk management in agriculture (GK)
The Council adopted Presidency conclusions about risk management in agriculture. "The Commission is ope for further discussion. There seems to be a broad consensus, that risks in agriculture increase with growing liberalisation and globalisation as well as with growing climatic uncertainties. This hold for both price and production risks. In order to avoid distortions of competition, it is therefore important that risk measures are taken within a common framework. Such a framework exists in the form of the guidelines and rules for state aids. Should the EU go still further? Of course, we observe and analyse what our trade partners and competitors are undertaking to help their farmers to manage risks and it is imaginable that this subject will also play a certain role in the new world trade round. I believe, we have therefore good reasons to remain open and to continue our discussion. New policy instruments for risk reduction would have to fit into the overall policy-mix of the CAP and sufficient funds would have to be made available. Against the current strict ceiling for agricultural expenditure, this could mean that less money might be available in such a case for the other, more traditional instruments of the CAP.", Fischler said.
Fruit and vegetables (GK)
The Council adopted Presidency conclusions about a simplification and an increase legal security for national administrations and Producer Organisations in the common organisation for fruit and vegetables, without increasing expenditures. "The Commission agrees that an improvement is needed on the inter-relation between the Common Market Organisation and Rural Development. In this respect, we take note of the emphasis put by the Council on avoiding double funding and we reaffirm the importance of making consistent and efficient use of both instruments. We agree that something must be done in order to support the development of POs in regions where there is a low level of organisation and, in this respect, ways should be found to facilitate mergers and associations of POs, and also transnational POs.", the Commissioner said.
French and Portuguese paper on the mid-term review (GK)
Responding to French and Portuguese position papers on the mid term review, Mr Fischler said: "Our general policy objective is to achieve a sustainable agriculture. The Commission will bring forward its proposals on 10 July. Our task is to meet our society's expectations. We have to meet the expectations of the society as a whole, while at the same time keeping in mind the concerns of the rural community. This is what I mean by creating a socially sustainable agricultural policy."
Evolution of cereal markets (GK)
Austria raised concerns about imbalances on the EU cereal markets in the light of incrased exports and the double zero agreements with the candidate countries. "Concerning the monitoring of the wheat and maize tariff quotas, special management procedures will be put in place in order to insure an orderly, transparent and non-speculative execution of the quotas. As regards the request to reinstate the additional 10 € duty in relation to imports from Eastern Europe. Tthis is not an acceptable solution to limit cereal imports at the moment. It would be politically unacceptable to apply higher tariffs for candidate countries than we actually do for the rest of the world. In addition, the Commission is currently examining several proposals in order to insure an adequate external protection in the EU cereals market.", Fischler responded.
As to the double zero agreements, the Commissioner said that the Council unanimously supported the negotiating objectives proposed by the Commisison in December 2001. These agreements convey a strong political signal of the willingness to integrate the CEECs into the European Union, to build confidence between the parties and to facilitate the enlargement negotiations. ", Fischler concluded.
Tobacco study (GK)
Mr Fischler informed his colleagues on the state of progress of the report on the functioning of the CMO for raw tobacco. The Commission asked, at the beginning of January 2002, to the Member States for a series of available statistical data on the development of the sector during the last three campaigns. The gathering and the processing of these data required a great effort on the part of the national administrations that delayed their sending. The requested elements were received only at the end of April 2002. The Special Committee on Agriculture was informed about this. "Under these conditions, the drafting of the Commission's report which will be a factual presentation of the compiled data, will be finalised as soon as possible in order to submit it to the Council during the month of September. The evaluation should be ready before the end of the year.", the Commissioner said.
Adopted as A-points: