Single farm payments cut being proposed

The European Commission has proposed a 1.37% cut in single farm payments.

This is under its financial discipline procedures, used to balance the CAP budget.

The reduction will ensure the EU retains a CAP crisis reserve of e450 million, which over the past two years has been used largely to offset the impact of the Russian trade ban.

This will apply in the CAP financial year, which begins in October.

This means the reduction will be from single payment applications submitted in May and due for payment in December, provided member states meet the timetable.

This applies to all single payments above e2,000.

The proposed figure is subject to final adjustment, based on the budget closer to the date. Farm ministers from the world’s developed economies will meet this week in a meeting organised by the Organisation for Economic Cooperation and Development (OECD).

The meeting is at a time when agriculture in just about every country is facing problems because of weak global markets and the fallout from economic problems in China.

Despite that the agenda is focused on ways to achieve a ‘productive, resilient, global food system’, which is far removed from the reality of farmers worrying about a cash flow crisis in their business.

This is the first time since 2010 that farm ministers have met through the OECD and the hope has to be that more relevant issues will surface during discussions. The European Commission has confirmed further bad news for dairy farmers, with production in January rising by 5.6% – the biggest ever month on month increase recorded.

This underlines the challenge in trying to balance European production in the face of global markets set to remain weak for the rest of this year.

More positive news, however, emerged on meat, with the commission reporting a surge in exports for beef, pork and poultry. Pigmeat exports in particular boomed.

These were up by 25% on January last year, thanks to China coming back into the market.

Poultry exports were up by 10%. Beef exports were relatively flat but live cattle exports, mainly to Turkey and Israel, jumped by almost 50%.

Much of this export success is down to the weakness of the euro against the US dollar, which makes Europe globally competitive. The European Commission has agreed a e30 million plan to shift some of its dairy surpluses by giving milk to Syrian children, displaced by war.

The milk will be exported as UHT and distributed through existing European programmes, mainly in Syria but also in other war affected areas