1,532,746 research outputs found
An assessment of the impact of possible CAP reform scenarios on Romanian agriculture
No full textUsing a simplified model, with key-variable the prices of two different possible scenarios of CAP reform after 2013 (moderate and radical), this paper present a comparison between the price effects of implementation of each reform scenario at 2015 horizon on Romanian agriculture. This short analysis shows that, under the presented hypotheses, the net welfare effect, due to the price changes, for the selected products, is positive in both reform scenarios, yet greater in the case of the radical reform. Integrated in the large context of Romanian development, it seems that the influence of CAP reform upon agriculture and rural areas will be most likely a gradual one: an interpenetration between the two scenarios is foreseeable, starting with the moderate reform that will dominate the period around 2013, the reform measures acquiring a more radical character afterwards.CAP reform, Romania, welfare effects, Agricultural and Food Policy,
The CAP and its Reform - Half a Century of Change?
No full textIn the fifty years since the Stresa Conference, the CAP has undergone many changes. Its presence, however, has been one of the most prominent and constant features of the 'European project'. This article outlines how the policy has changed and identifies the key pressures driving that change, in the context of unchanging formal objectives for the policy. Having established price support as the primary means of supporting farm incomes, crucial elements of the EU budget process then combined with rising production and surpluses to put the CAP on a path that led inexorably to financial crisis. As the EU began to deal with these pressures, so price support was already taking the policy towards another pressure point - growing subsidised exports and, ultimately, clashes in the GATT over trade-distorting policies and their effects on other countries. In the reforms since 1992, designed to address both budget and trade concerns, the direction the policy has taken has also been influenced by newly-emerging issues, notably the welfare and health of the environment, animals and consumers. Yet despite all these changes and the vast sums spent, the extent to which the farm income problem has been resolved remains unclear. Despite the centrality of income concerns to the CAP, data on farm household incomes remain limited - and there exists considerable political opposition to changing this situation. Copyright (c) 2008 The Author. Journal compilation (c) The Agricultural Ecomomics Society and the European Association of Agricultural Economists 2008.
CAP-uudistuksen vaikutukset kasvintuotantoon
No full textTutkimuksessa tarkasteltiin CAP-tuen irtikytkemisen eri vaihtoehtojen vaikutusta viljelijän tuotantopäätöksiin tilatasolla sekä kasvintuotantoon koko maatalouden tasolla Tuen irrottaminen tuotannosta parantaa sellaisten viljelykasvien ja pellonkäyttömuotojen suhteellista kannattavuutta, joiden CAP-tuki on ollut viljojen tukea alhaisempi, tai jotka eivät ole aikaisemmin saaneet CAP-tukea lainkaan. Suomessa keskeinen kysymys on, kuinka paljon vilja-alasta siirtyy kesannolle tai nurmelle. Tutkimustulokset viittaavat siihen, että jos CAP-peltokasvituen perusosa irrotetaan tuotannosta, mutta kuivauskorvausta ei, vilja-ala ei muutu. Jos kuitenkin kaikki CAP-peltokasvituki irrotetaan tuotannosta, se siirtänee pitkällä aikavälillä 10-20 % vilja-alasta kesannolle. Suomen vilja-ala saattaisi alentua pitkällä aikavälillä nykyisestä lähes 1,2 miljoonasta hehtaarista noin 950 000 hehtaariin, eli samalle tasolle kuin se oli runsaan kesannoinnin vuoksi vuosina 1994-1995. Muutos olisi suurin keskimääräistä heikkotuottoisemmilla viljelysmailla ja tiloilla, joilla tuotantokustannukset ovat keskimääräistä korkeammat. Peltoa siirtyisi nautakarja- ja maitotiloilla jossain määrin myös viljalta nurmelle, mutta nurmiala kokonaisuudessaan edelleen alenisi nykyisestä. Vilja-alan pieneneminen ei kuitenkaan vähentäisi maataloustuloa, vaan se alentaisi ensi-sijaisesti rehuviljan vientitarvetta. Rehuviljaa riittäisi edelleen tyydyttämään kotimaisen tarpeen eikmuutoksella olisi oleellista vaikutusta rehuviljan hintaan. CAP-peltokasvituen täydellisellä irrottamisella taattaisiin tukioikeuksien säilyminen samalla tasolla, vaikka tuotannon määrä vähenisi ja tuotannosta poistuisi heikkolaatuista peltoa. Vaikka heikkotuottoisella maalla tai erityisen korkeiden kustannusten tiloilla kannustin investoida viljan tuotantoon heikkenisi, suurella pääosalla tiloja kannustin tuottaa viljaa ei olennaisesti heikkenisi muiden tuotantoon sidottujen tukien vuoksi, ja myös sen vuoksi, että pelto olisi kuitenkin pidettävä viljelykunnossa irrotetun tuen saamiseksi. Nämä seikat huomioiden rajakustannus viljantuotannon jatkamiseen ei ole suuri. Kannattavuuskirjanpidon kustannusaineisto osoittaa merkittäviä kustannussäästöjä tuotantoyksikköä kohti suurilla yli 50 hehtaarin tiloilla verrattuna pieniin alle 30 hehtaarin viljatiloihin. Sen vuoksi suuntaus suurempiin tilakokonaisuuksiin ja tehokkaaseen työnkäyttöön viljantuotannossa jatkuu kaikilla CAP-pelto-kasvituen vaihtoehdoilla. Rukiin interventiojärjestelyjen päättyminen voi alentaa merkittävästi rukiin hintaa ja vähintäänkin lisätä sen hintavaihtelua EU:n sisämarkkinoilla. Rukiin suhteellinen kannattavuus alenee selvästi muihin viljoihin nähden. Rukiin osalta tarvittaisiin edelleen tuotantosidonnaista tukea, mikäli sen viljelyala halutaan säilyttää nykyisenä.In the reformed Common Agricultural Policy (CAP) of the EU support is no longer paid on hectare basis. The decoupling area based CAP-support from production increases the relative profitability of all crops which have not been eligible for CAP support earlier. In Finland, the CAP-reference yields vary between 2.3-3.4 tons per hectare and the level of CAP support paid per hectare is relatively low. The other area based supports schemes, like LFA- and environmental support as well as some national support, remain largely tied to production. In addition, farmers have to keep land in good condition in order to receive decoupled support. Hence, the cost of continuing crop production after decoupling the CAP support is relatively low, considering other production linked supports. Consequently, decoupling CAP area support is not likely to have any drastic effects on Finnish crop production or use of agricultural land. Especially, if the specific grain drying support, paid in Finland and in the northern part of Sweden, remain coupled to production one cannot reasonably expect any changes in crop production in Finland. However, if also the grain drying support were decoupled then the overall grain area, according to our research results, would decrease by 20%, i.e. from the current 1.2 million hectares to 0.9-0.95 million hectares in the next ten years. This would diminish the feed grain production and gradually cease the oversupply and exports of feed grain from Finland. However, the domestic feed grain supply would still cover domestic demand. The set-aside area would simultaneously increase from 0.2 million hectares up to 0.5 million hectares in Finland. The change in crop production and land use, however, would not affect agricultural income at all, because only marginal land, which produces low crop yields, would be left as set-aside. There would be no change in land usage on lands with average or high crop yields. Hence, the CAP reform and reduction of oversupply would have a positive impact on grain markets in Finland. The decreasing grain area would also mean lower level of production linked supports for tax payers without any loss of farm income. However, rye cultivation would cease as a result of CAP reform which will cease intervention purchases of rye. The resulting drop of rye prices would make rye clearly a relatively uncompetitive and unprofitable crop in Finland if no other production linked support will be established for rye. These conclusions were derived from farm level production decision methods and a mathematical regional sector model used in the analysis.vokMTT TaloustutkimusImpacts of decoupling CAP support on crop production in Finlan
CAP Reform Options: A Challenge for Analysis and Synthesis
No full textThe European Union’s Common Agricultural Policy is continually evolving. The growing debate about the future of the EU Budget post 2013 raises major questions about the future of the CAP. A formal Communication on the future of the Common Agriculture Policy (CAP) after 2013 is due to be published by the Commission in the summer/early autumn of this year – in order to launch a full public debate on the issues, and as a part of the Budget Review of 2011. Formal legislative proposals on the post-2013 CAP will then follow in mid-2011 – together with Commission proposals for the post-2013 Financial Perspectives. It is, therefore, appropriate to review the discussions of further reforms, and also to consider our professional capacity to provide robust analysis of potential futures. The debate on the future CAP is of more than an agricultural interest as it affects, inter alia, the environment, climate change, food quality and security and rural communities and their development. Numerous views have already been expressed on the future of the CAP. However there is very limited synthesis of the options and principles underlying their evolutionary fitness – that is, the extent to which suggestions correspond to the socio-economic environment and political climate upon which the future persistence of the CAP depends. This paper synthesises present views on the future of CAP, and outlines a possible conceptual framework for future research and analyses in the field.Agricultural and Food Policy,
Good Regulatory Lags for Price Cap and Rolling Cap contracts
No full textPrice caps are a popular form of monopoly price regulation. One of its disadvantages is the perverse incentives that regulated firms might have to scamp on cost reducing effort during the last years before a price review. In order to avoid this problem a “rolling cap†contract was introduced in the United Kingdom that overcomes this last problem. In spite of their popularity, there is scant research on the optimal regulatory lag (number of years between price reviews) of a price cap or rolling cap contract. In practice, around the world most price cap or rolling cap contracts have a lag of 4 to 5 years, but this is not based on any optimality consideration. As is well known, the regulatory lag determines the power of an incentive contract and thus the incentives to undertake cost reducing effort. Schmalensee (1989) studied the optimal power of regulatory contracts in a static model with uncertainty and asymmetric information. She finds that medium powered contracts are generally superior to the polar cases of high or low powered contracts. In this paper, we extend Schmalensee (1989) model used to study the optimal power of regulatory contracts to a dynamic framework. We use numerical simulation to study the optimal regulatory lag for different combinations of demand and cost parameters under a particular linear quadratic structure. We find that in general a 2 year lag is optimal under both a price cap and rolling cap contracts and that a benevolent regulator prefers the rolling cap over the price cap contract in almost all the casesPrice Cap, Rolling Cap, Regulatory Lag, Dynamic Programming
Decoupling and prices: determinant of dairy farmers’ choices? A model to analyse impacts of the 2003 CAP reform
No full textThe reform of European Common Agricultural Policy (CAP) in 2003 has resulted in substantial changes to the attribution of subsidies to dairy farmers. Moreover, dairy farmers are in also facing an unprecedented situation on the markets with the soaring prices of agricultural raw materials: they sell their products at a higher price (milk, meat and cereals), but must also cope with the increasing prices of concentrates. In this paper1, we discuss cross effects, on the productive strategy of French dairy farms, of the Luxemburg Agreement and the prices variations. A model based on mathematical programming has been privileged to determine how dairy farmers might re-evaluate their systems to identify optimal production plan. While respecting the principle of agent rationality (maximization of profit), the model incorporates the economic risk related to the volatility of the inputs and outputs prices. Thus the model maximises the expected utility of the income while taking into account a set of constraints: regulatory, structural, zootechnical, agronomic and environmental. The model is applied to four types of dairy farms to cope with the diversity of production systems in the west of France (“grazier” type, “semi intensive” type, “milk + cereals” type and “milk + young bulls” type). The model is used to produce quantitative estimations and support reflection through the simulation of the setting up of the Single payment scheme. The sensitivity of the results is discussed by taking into account several options of prices for cereals and livestock products. These may have a strong influence on the structure of the diet and, therefore, on the level of intensification of the forage area. The results show that the implementation of the CAP reform encourages farmers to substitute a part of corn silage by grass in the diet. However, the rising price of agricultural production encourages, on the contrary, farmers to intensify their system in order to free up land for growing cereals. We also observe that a decrease of the young bulls fattening activity to develop cereal crops is also economically profitable.dairy farm, single payment, price variation, Agricultural and Food Policy, Livestock Production/Industries,
Various Features of the Chooser Flexible Cap
No full textIn this paper, we theoretically look into various features of a chooser flexible cap. The chooser flexible cap is a financial instrument written on an underlying market interest rate index, LIBOR (London Inter-Bank Offer Rate). The chooser flexible cap allows a right for a buyer to exercise a limited and pre-determined number of the interim period caplets in a multiple-period cap agreement. While the chooser flexible cap is more flexible and cheaper instrument than the normal cap, its pricing is more complicated than the cap's because of its flexibility. So it may take long time for its price calculation. We can use the features to cut down the calculation time. At the same time the option holder can use the features for exercise strategies.chooser flexible cap, LIBOR, dynamic programming, exercise strategy.
Effects of EU CAP implementation on Bulgarian farms
No full textThis paper assesses impacts of EU CAP implementation on Bulgarian farms of different type and specialization. First, a framework for assessing the CAP effects on farms is presented. Next, an evaluation is made of the impacts of CAP on: economic results and income of farms; production and governance efficiency of farms; level of competitiveness of farms; and economic, social, and environmental sustainability of farms. Finally, factors for improvement of CAP impact on farms in the country are identified.impacts of EU CAP, income, efficiency, competitiveness, and sustainability of farms
CAP-uudistuksen vaikutus naudanlihantuotantoon
No full textUudistuksessa on mahdollisuus säilyttää osa nautatuista tuotantoon sidottuina seuraavasti: 1) Säilytetään emolehmäpalkkio ja enintään 40 % teuraspalkkiosta tuotantoon sidottuna; 2) Säilytetään teuraspalkkio tuotantoon sidottuna 3) Säilytetään enintään 75 % sonnipalkkiosta tuotantoon sidottuna Muu osa CAP-nautatuista maksetaan tuotannosta irrotettuna tilatukena. Koska noin 90 % Suomessa tuotetusta naudanlihasta on peräisin lypsykarjarotuisista eläimistä, naudanlihantuotantoon vaikuttavaa merkittävästi maidontuotannon kokonaismäärä. Koska lypsykarja-rotuisten nautaeläinten lukumäärä alenee väistämättä maidon maakiintiön ja lehmien keskituotoksen nousun vuoksi, naudanlihantuotannon tulevan kehityksen kannalta olisi tärkeää säilyttää kannustin naudanlihantuotantoon. Mikäli tuotantomotivaatio säilyy, teuraspainojen nousu ja emolehmien määrän kasvu voivat jonkin aikaa hidastaa naudanlihantuotannon vähenemistä. Mikä tahansa ym. vaihtoehto kuitenkin heikentää naudanlihantuotannon kannattavuutta. Ellei nautaeläimiä kasvateta täyteen teuraspainoonsa, naudanlihantuotanto voisi yhdessä lypsykarjarotuisten eläimien vähenemisen myötä vähentyä merkittävästi. Jos tuotanto alenee, naudanlihan hinta voi nousta. Suomen korkeiden tuotantokustannusten takia mahdollinen hinnannousun ei todennäköisesti olisi riittävä jotta se kannustaisi tuotantoon. Tilatason kustannusaineiston avulla laskettujen katetuottojen mukaan CAP-nautatukien täysi irrotus tuotannosta johtaisi eläinkohtaisen katteen merkittävään alenemiseen, mikä puolestaan heikentäisi oleellisesti kannustinta investoida naudanlihantuotantoon. Vaihtoehto 3 säilyttäisi parhaiten kannustimen tuottaa naudanlihaa ja investoida tehokkaisiin erikoistuneisiin tuotantoyksiköihin. Investointeja tarvitaan jatkossakin jotta erikoistuminen naudan-liha- ja maitosektoreilla voisi edetä. Nautatilojen kannattavuus ja talous riippuvat myös siitä miten tuotannosta irrotettu CAP-tuki maksetaan. Historiallisen tuotannon mukaan maksettava tilakohtainen tuki pitäisi tukisumman entisellään ellei tila olisi laajentanut tuotantoa vuoden 2000 jälkeen, kun taas alueellinen tasatuki voisi vähentää nautatilan tukea. Toisaalta viitekauden 2000-2002 tuotannon perusteella maksettava tilatuki houkuttelisi tasatukea enemmän tuotannosta luopumiseen.In the reformed CAP, there are three alternatives to maintain beef cattle supports coupled to production: 1) Maintain the current suckler cow premium at up to 100% and maintain the current beef slaughter premium at up to 40% 2) Maintain the current beef slaughter premium at up to 100% 3) Maintain the current special male premium at up to 75% All the other CAP animal supports in each alternative will be decoupled from production and paid as a single farm payment. 90% of the Finnish beef supply comes from dairy breed bovine animals and only 10% from beef breed bovine animals. Even if the milk production volume were to stay unchanged, which is a rather optimistic assumption taking into account the CAP reform analysis made for the dairy sector, beef production will inevitably decrease in the long-run because of increasing milk yields of dairy cows. In the short-run the slaughter weight of bovine animals as well as the number of suckler cows may increase for a while and prevent the decreasing beef supply. The upper limit for suckler cow premiums is 55,000 animals in Finland, where the number of suckler cows was approximately 30,000 animals, and the number of dairy cows was 340,000 in 2002. Any decoupling alternative, however, will weaken either incentives for suckler cow production, or incentives for bull fattening considerably in Finland. Beef prices are likely to go up in Finland if beef production declines, but the price increase is not likely to be sufficient in order to retain incentives for production because of high production costs in Finland. According to the farm level data material used in this study, the full decoupling of CAP animal supports would reduce operating margin per bull or suckler cow drastically and cease the ongoing trend of specialised bull fattening. The alternative which maintains 75% of special premiums for bulls and 10% aid entitlement directed for suckler cows, however, would still provide future prospects for beef production. Even if the rate of return on invested capital on beef farms were to decrease in any alternative, this alternative would still provide some incentives for investment in feedlots. Such investment would facilitate the production specialisation in both beef and sectors, potential for higher slaughter weights and increasing farm size also in the future. The profitability of current beef farms, however, depends on the decision on the form of the single farm payment. The historical single farm payment would keep the returns of beef bull farms at a higher level than would be the case in a regional flat rate support system. On the other hand, support entitlements based on historical production would make the exit from beef production more attractive than regional farm payments.vokMTT TaloustutkimusImpact of decoupling CAP supports on beef productio
THE FUTURE OF THE CAP – A DECLINING POLICY IN THE EUROPEAN UNION?
No full textThe CAP, more than any other EU policy, has traditionally been seen as the core of European integration. Yet, the interests of the member states over agricultural agenda diverge to an extent that has encroached on the supranational construction and the communautaire nature of this policy area. The 2008 health-check debate has clearly shown a tendency for providing several policy options, which vary significantly the level of agricultural support among Member States (partial decoupling, additional payments within Article 69 of the Council Regulation No 1782/2003). The second pillar of the CAP is treated in fact as an indirect source of subsidies for farmers, instead of improving economic and social development in rural areas. In fact, specific patterns of re-nationalization in this policy sphere can be discerned. Therefore, is the CAP a EU policy in decline? Will the future CAP lose its common character and be replaced by national agricultural policies? The present paper sheds light on the current health-check debate and considers the future perspectives of the CAP. Specifically, national positions of selected old and new Member States on major elements of the health check are examined. In particular, Germany, France, United Kingdom, Poland and the Czech Republic are cited as examples of countries with heterogeneous agricultural sectors. It conclusion, it is noted that growing differentiation within the CAP leads to its marginalization and will also probably lead to its formal re-nationalization. Therefore, the evolution of the CAP from the most common and regulated EU policy to a wide range of possible national implementation systems raises a question about the future of other EU policies, particularly those in the making, like for example the European Security and Defense Policy.CAP, national preferences, health-check debate, Agricultural and Food Policy, Political Economy, Q18,
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