On
4 June 2012, the EC opened a public consultation with sector
stakeholders on the future of the fruit and vegetable regime. The
consultation period is open until 9 September 2012, and inputs will be
fed into the preparation of a report, scheduled for May 2013, on the
performance of the regime since the 2007 reforms (which entered into
full effect in 2009), and into possible further changes from 2014. This
forms part of the necessary sector reviews which will inform the broader
process of CAP reform.
The EC maintains that no major changes to the fruit and vegetable regime are foreseen, as the 2007 reforms already set in place crisis prevention and management tools, decoupled processing aids and eliminated export refunds, and sought to strengthen producer organisations (POs).
The consultation paper posted by the Commission to stimulate inputs does, however, recognise some significant shortcomings in the reforms to date. It notes the limited coverage of POs: in some new member states a meagre 0.2–0.3% of producers are organised in POs, and in no member states are more than half of all producers organised in POs. As a consequence, most EU fruit and vegetable producers do not benefit from the current regime, since implementation of support measures is currently exclusively through POs.
The paper also notes ‘the persisting imbalance of bargaining power that fruit and vegetable producers have vis-à-vis the distribution sector’, and ‘recurrent market crises’, citing ‘limited use of crisis prevention and management tools’ – in the ‘crisis year’ of 2009, only 3.1% of operational programme expenditures were used on crisis measures, compared to a permitted ceiling of up to 33%).
The paper observes that ‘as a result of the globalization of the markets, the EU fruit and vegetable sector faces increasing and more intense competition from products from third countries.’
Stakeholders’ inputs are sought on a number of major issues, including how to:
Option 1: The status quo.
Option 2: Creating new instruments to reinforce POs, improve crisis management and stimulate competitiveness of individual producers. This could involve: further strengthening POs; supporting new forms of cooperation; encouraging more cooperation between POs and individual producers; directly supporting individual producers to improve productivity and competitiveness.
Option 3: Transferring certain support measures to the rural development instrument, since currently investment support measures are split between fruit and vegetable regime programmes and rural development programmes.
Option 4: Transferring all fruit and vegetable support measures to the EU rural development programme pillar.
Specific measures envisaged include:
The EC maintains that no major changes to the fruit and vegetable regime are foreseen, as the 2007 reforms already set in place crisis prevention and management tools, decoupled processing aids and eliminated export refunds, and sought to strengthen producer organisations (POs).
The consultation paper posted by the Commission to stimulate inputs does, however, recognise some significant shortcomings in the reforms to date. It notes the limited coverage of POs: in some new member states a meagre 0.2–0.3% of producers are organised in POs, and in no member states are more than half of all producers organised in POs. As a consequence, most EU fruit and vegetable producers do not benefit from the current regime, since implementation of support measures is currently exclusively through POs.
The paper also notes ‘the persisting imbalance of bargaining power that fruit and vegetable producers have vis-à-vis the distribution sector’, and ‘recurrent market crises’, citing ‘limited use of crisis prevention and management tools’ – in the ‘crisis year’ of 2009, only 3.1% of operational programme expenditures were used on crisis measures, compared to a permitted ceiling of up to 33%).
The paper observes that ‘as a result of the globalization of the markets, the EU fruit and vegetable sector faces increasing and more intense competition from products from third countries.’
Stakeholders’ inputs are sought on a number of major issues, including how to:
- strengthen competitiveness and enhance productivity while managing the environmental consequences of fruit and vegetable production;
- close the widening gap between trends in input costs (rising) and producer prices;
- promote consumption and development of new fruit and vegetable products to reverse the decline in per capita consumption which is under way;
- improve the resilience of the sector to market disruptions;
- improve the functioning of fruit and vegetable supply chains to increase ‘the share of value added for producers’, including by ‘improving the bargaining power of producers’;
- simplify the regime and enhance budgetary disciplines;
- identify challenges not so far addressed by the EC within the fruit and vegetable sector;
- identify the likely impact of the different measures advanced under the various options for reform set out in the consultation document.
Option 1: The status quo.
Option 2: Creating new instruments to reinforce POs, improve crisis management and stimulate competitiveness of individual producers. This could involve: further strengthening POs; supporting new forms of cooperation; encouraging more cooperation between POs and individual producers; directly supporting individual producers to improve productivity and competitiveness.
Option 3: Transferring certain support measures to the rural development instrument, since currently investment support measures are split between fruit and vegetable regime programmes and rural development programmes.
Option 4: Transferring all fruit and vegetable support measures to the EU rural development programme pillar.
Specific measures envisaged include:
- the extension of entitlements to decoupled direct aid payments to all fruit and vegetable producers, not just those previously receiving processing aids, with a consequent extension of cross-compliance requirements to all producers;
- the establishment of an overall budgetary ceiling for expenditures through POs, not just ceilings for individual POs.
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