European Farmers’ Protests: A Response to CAP Reforms and Economic Pressures.
Farmers across Europe began protesting in late 2023 and continued into 2024, primarily driven by the stricter environmental regulations imposed by the reformed Common Agricultural Policy (CAP), compounded by economic uncertainties, and trade policies that favor cheaper imports from non-European countries. In a nutshell, CAP sets guidelines for farming in Europe, provides farmers financial support, ensures an affordable food supply for European consumers, and supports rural development. CAP makes up about 30 to 40 percent of the total EU budget, whereas the U.S. Farm Bill, a similar policy in the U.S., accounts for 2 to 3 percent of the federal budget.
In 2023, CAP went through some significant changes that took effect in 2024 to align European agriculture to environmental and climate goals. These changes include stricter environmental regulations, tying CAP payments to eco-scheme that reduces direct payments to farmers, and not addressing import competition from trading partners that do not have the same environmental standards.
While these CAP reforms are in line with broader EU funded initiatives and have achieved some objectives, they have also led to notable drawbacks. For example, stricter environmental regulations have increased operational and administrative costs and the financial support given by the EU does not fully offset these costs. Also, mandatory agricultural land use for non-productive uses, such as conservation, could make Europe more dependent on imports as less land is available for production.
Through their protests, farmers are seeking modifications to the new environmental requirements that will help reduce their costs. They also want the EU to support trade policies that will prevent cheap agricultural imports from non-EU countries from flooding the market and ensure that imported goods meet the same environmental standards required of EU-produced goods.
For European processing tomato growers, the reformed CAP is expected to lead to higher production costs due to the need for additional inputs and the administrative burden of complying with new environmental standards. On the flip side, because a portion of CAP payments are now tied to eco-schemes, farmers may receive less direct payments if they choose not to participate in these voluntary programs. As a result of these higher costs and tighter margins, the European processing tomato industry could face reduced domestic production and increased competition in the domestic and export market for their finished products.
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