Brussels, 10/02/2006 (Agence Europe) - On 9 February, the European Commission published its farm market forecasts, predicting a 12.8% rise in real terms in the average EU farm unit's income between 2005 and 2002, but this figure hides huge differences between countries, with an average +6% rise forecast for the old 15 Member States and +50.4% for the new Member States, despite the latter seeing a slow-down in the growth of farm income (+182% in 2003, just before joining the EU). Last year, the European Commission predicted a 11.7% rise in EU farm income (see EUROPE 9003). The Commission admits its forecasts are subject to change, depending on WTO decisions on free trade (the Doha Trade Round) and bird flu.
The report writes that the mid-term prospects are relatively favourable for the cereal, meat and dairy product markets, but the increase (since 2004) in stock-piled cereals could make the market more fragile. It is expecting a gradual fall in cereal surpluses, however, through a moderate rise in internal demand, better conditions on the world commodity markets and better integration of the new Member States into the single market. The meat market has returned to normal following problems encountered in recent years. The current beef market situation (where more beef is eaten than is produced in the EU) is expected to continue throughout the 2005-2012 period so the Commission is forecasting a rise in beef imports into the EU. The production and consumption of pork and poultry is expected to grow in the medium term, according to the Commission's report, but it admits that it has not taken the impact of the bird flu crisis into account in its predictions of poultry sales. For the dairy industry, the Commission is forecasting a fall in the medium term in the production of butter and skimmed milk powder because of the increasing trend to convert milk into cheese and other dairy products with higher value added. (The full European Commission report is available on the web at: http://www.europa.eu.int/comm/agriculture/publi/prospects2005b/index_en.htm )