Brussels, 19/08/2014 (Agence Europe) - On Monday 18 August, the European Commission announced that it was to unblock €125 million to support the EU fruit and vegetables sector, which has been hit by a year of Russian embargo on Western food products. An extraordinary meeting of the agriculture ministers of the EU will be held in Brussels on 5 September to take stock of the impact of the Russian ban.
These market support measures through compensated withdrawals of products concern carrots, tomatoes, white cabbage, peppers, cauliflowers, cucumbers, gherkins, mushrooms, apples, pears, red fruits, table grapes and kiwis, will be formally announced in a few weeks' time, but have been in force retroactively since Monday 18 August. They will stay in place until the end of November.
The main suppliers of perishable vegetables and fruit to Russia - Poland, Lithuania, Belgium and the Netherlands - will be the main beneficiaries of this support.
All producers will be eligible. “All farmers of the concerned products - whether in producer organisations or not - will be eligible”, said the Commissioner for Agriculture, Dacian Ciolos.
The EU budget earmarked for these measures is in the region of €125 million. The aim is to reduce the quantities placed on the market to prevent prices from dropping to crisis level, a source close to the Commission's services explained. The Commission has decided to trigger these emergency measures, which it is able to fund out of a crisis reserve of more than €420 million a year, due to the absence of alternative outlets for the perishable products in question, hit by the ban in the middle of harvest.
The mechanism will increase from 5% to 10% the volume of products which can be withdrawn from the markets and will compensate producers at a level of 50% to 100%, depending on whether the product is sold in any other form, has not been harvested or is distributed free of charge.
The Commission states that it will “not hesitate to support further sectors”, such as cheese and meat, which have also been hit by the ban.
After a meeting of the agricultural experts of the Commission and of the 28 member states of the EU, the Commission announced on Thursday 14 August that it would be taking further exceptional measures to support fruit and vegetable producers affected by the Russian embargo.
On Monday 11 August, the Commission had already decided to assist the peach and nectarines sector, in which problems caused by poor weather conditions have been made worse by the Russian ban (see other article).
In a press release, Copa-Cogeca “welcomes” this support to the agriculture sector of the EU in response to the crisis. It calls on the Commission to rapidly implement the planned measures to prevent any further deterioration of the market. “Prices for perishable products” such as fruit, vegetables and fresh dairy products “have been hit hard by the crisis, falling by up to 90% in some cases. Prices for other products targeted by the ban are also coming under intense pressure”, the organisation states. It calls for “implementation of extraordinary market measures such as withdrawing products from the market and sending them to, for example, charities, accelerating the date of payment for direct payments, speeding up promotion campaigns to stimulate new demand and accelerating some free-trade agreements with non-EU countries to open their markets”.
The Russian ban will hit the farming sector hard well beyond one year, says Copa-Cogeca. Initial indications show that costs will be considerably more than the €400 million earmarked out of the CAP crisis funds, according to these organisations, which argue that the aid granted should be paid for out of funds other than just the CAP budget. “In view of the size of this crisis, monitoring the profit margins in the food chain will also be of huge importance to reduce speculation. The Commission must also ensure measures are co-ordinated between member states and ensure that extra national funds are released to deal with the crisis”, Copa-Cogeca concluded. (LC)