Brussels, 14/06/2007 (Agence Europe) - Agriculture ministers from EU member states reached a unanimous political agreement, on Tuesday 12 June, on reform of the common market organisation in the fresh and processed fruit and vegetable sector. According to Mariann Fischer Boel, the commissioner for agriculture, reform will fulfil the following objectives: to improve competitiveness and market orientation of the fruit and vegetable (F&V) sector; to reduce income fluctuations resulting from crises, to promote consumption and thus contribute to improved public health; and to enhance environmental protection. The changes aim to encourage more growers to join producer organisations (PO); to offer POs a wider range of tools for crisis management; to integrate the F&V sector into the single payment scheme; to require a minimum level of spending on environmental measures; to increase EU funding of organic production and promotional measures; and to abolish export subsidies for F&V. The reform will enter into force in 2008.
Single payment system: each farm cultivating F&V will become eligible for the single payment system as applied in other agricultural sectors. Current aid paid to processed F&V producers will be decoupled (an end in the link to level of production) and national budgetary ceilings applied to the single payment system will be raised. The total amount to be transferred to the single payment system is around €800 million a year.
The compromise includes two transition periods before the change to the full decoupling of aid: for tomatoes, member states will be authorised to conserve aid per hectare for four years (2008-11) on the condition that the part coupled with the payment does not exceed 50% of the national ceiling.
Multi-annual crops: (such as prunes), the transition period (before total decoupling) is five years (2008-12), provided that after 31 December 2010, the part of aid that is coupled does not exceed 75% of the national ceiling. Member states that want to can postpone rights applicable to F&V by three years.
Crisis management: this will be organised through producer organisations (50 percent financed by the Community budget). Tools will include help in securing bank loans (this addition in the compromise was not included in the initial draft), market withdrawal, green harvesting/non-harvesting for F&V, promotion and communication tools in times of crisis, training, harvest insurance and financing of the administrative costs of setting up mutual funds. Crisis management tools cannot account for more than a third of spending in operational programmes implemented by POs. Withdrawals can be carried out by POs with 50 percent co-financing. Withdrawals for free distribution to schools etc will be 100 percent paid by the Community.
Two concessions were granted during negotiations to producer countries: Community aid to POs will remain limited to 4.1 percent of the total value of marketed produce, but this may rise to 4.6 percent provided that the excess is used only for crisis prevention and management; for three years, state aid may be granted to extend crisis management measures to non members who enter into a contract with a PO. Compensation for non members will be no more than 75 percent of the Community support received by PO members.
Producer Organisations: There will be additional support (60 percent Community co-financing rather than of 50 percent) in areas where production covered by POs is less than 20 percent, particularly in the new member states. Member states and POs will develop operational programmes based on a national strategy.
Environment: as well as cross compliance (aid granted on condition of meeting mandatory standards), POs must devote at least 10 percent of expenditure in each operational programme to environmental measures. There will be a 60 percent Community co-financing rate for organic production in each operational programme.
Consumption: There will be a budget of €6 million for promoting regulation of F&V, targeted at children in educational establishments. There will also be €8 million for free distribution of F&V to schools, hospitals and charitable bodies, which will be 100 percent financed by the Community up to a limit of 5 percent of the quantity marketed by a PO. The Council asked the Commission to carry out a feasibility study into the creation of a school fruit and vegetable scheme. Fischer Boel hopes to make €200 million available from public funds for this programme (50% funded from EU - 50% from member states).
Red fruit: To allow producers (especially Polish) of strawberries and raspberries for processing to adapt to market circumstances, they will receive a transitional direct payment worth €230 per hectare.
Surface area eligible for this support covers 52,700 ha: 48,000 ha for Poland, 2,400 for Bulgaria, 1,700 for Hungary and 66 ha for Lithuania. These countries are authorised to pay a national complement, on condition that the total aid does not exceed €400/ha.
Potatoes, orchards, nurseries and tomatoes: The countries (Italy, Finland and Cyprus) that pay state aid to the potato sector, may continue to do so until 31 December 2011. At the request of Sweden and Denmark in particular, the member states may subsidise orchards. Also, nurseries become eligible under the single payment scheme. Greece receives an increase in aid for fruit and vegetables thanks to the fact that the 2004 peach harvest, which was catastrophic, was not included in the calculations. Finally, Italy and Spain have been authorised to pay national aid of €15 million during the 2007-2008 harvest year to their tomato processing industries.
Simplified payment regime: The new member states that use the single area payment scheme (SAPS) are authorised to make a decoupled fruit and vegetable payment to historical producers of fruit and vegetables. By 1 November 2007 at the latest, these countries should decide how much should be deducted from the SAPS envelope to cover this. (lc)