PDF file: Annual Report 2002/2003 - Scottish Crop Research Institute

Director’s Report
EU Agriculture Agriculture in the EU should be seen
in the context of its interface with the rest of the
world, and its relevance to the economic and social
development of the Union. The EU remains the foremost
importer of agricultural products in the world,
and the second largest exporter after the USA; in
2000, the trade flows in agricultural products in the
EU were around €58 billion for imports, and a similar
figure for exports. In addition to its involvement
in the WTO and OECD, the latter having its important
Committee for Agriculture, the EU operates the
Generalised System of Preferences in order to promote
the integration of the LDCs into the world economy
and the multilateral trading system, the UN’s Food
and Agriculture Organisation (FAO), as well as a
series of bilateral and regional trade negotiations with
the USA, Canada, Mercosur, Chile, South Africa,
South Korea, Japan, the non-EU Mediterranean
states, and the Balkan States. Within the EU, the pattern
of spending on agriculture is split between market-related
measures (Pillar 1), and rural development
(Pillar 2). There is also spending under the Guidance
Section of the EAGGF. Pillar 1 expenditure covers
spending on market-related measures (e.g. direct aid to
farmers, public intervention, export refunds), and
measures to promote product quality. All Pillar 1
measures are funded in their entirety from the EU
budget. Pillar 2 is designed to finance rural development
measures such as agri-environment and early
retirement schemes, training programmes, afforestation
of agricultural land, and compensatory
allowances in the less-favoured areas of the EU. Pillar
2 spend has a component of co-financing by Member
States. According to Eurostat, in 2000, the shares of
individual products in final agriculture production in
the EU were (a) fresh vegetables including potatoes
and fresh fruits 17.8%, milk 13.8%, beef and veal
10%, pigmeat 8.7%, cereals excluding rice 12.6%,
wine and grape must 5.5%, poultry 4.1%, sugarbeet
1.7%, eggs 1.8%, sheepmeat and goatmeat 2.2%,
oilseeds 1.9%, olive oil 1.8%, and the rest 17.8%. As
a share in final agricultural production in the EU in
2000, there was great variation: France 22.7%,
Germany 15.9%, Italy 14.9%, Spain 12.1%, UK
8.7%, The Netherlands 7.0%, Greece 3.9%,
Denmark 3%, Belgium 2.5%, the Republic of Ireland
2.1%, Portugal 2.0%, Austria 1.8%, Sweden 1.8%,
Finland 1.3%, and Luxembourg 0.1%.
Around 18% of the value of agricultural production in
the EU is derived from the fruit and vegetable sector,
and exhibits remarkable variety. Total vegetable production
in 2001-2002 was around 55 million metric
tonnes (Italy 15 mmt, Spain 12 mmt, and France 8
mmt); fresh-fruit production was around 57 mmt
(Italy 18 mmt, Spain 15 mmt, and France 11 mmt).
Interestingly, the 10 accession states produce around 9
mmt of vegetables and 6 mmt of fruit, dominated by
Poland (5 mmt vegetables, 3 mmt fruit). Tomato production
(15 mmt), citrus (10 mmt), apples (9 mmt),
peaches and nectarines (4.2 mmt), dry onions (3.9
mmt), carrots (3.7 mmt), lettuce (3.2 mmt), cabbages
(3 mmt), and pears (2.9 mmt) are the major horticultural
crops, mainly addressing EU consumption of 43
mmt fresh fruit and 46 mmt of vegetables. Global
production of fresh fruit and vegetables in 2001-2002,
according to FAO, was around 1.230 billion tonnes,
with fruit production around 470 mmt and vegetables
around 760 mmt. The regional share of production
was Asia 61%, EU 9%, North and Central America
9%, Africa 8%, and South America 7%. Preliminary
data indicate a strong trend of increasing production.
Although the EU has a fruit and vegetables policy
(operating as a ‘regime’ for fresh fruit and vegetables,
both covering a wide range of produce and products)
the aim of the regimes is to encourage horizontal integration
of producers and strengthen their market influence.
Funds are made available for producer
organisations, and for operational programmes such as
product improvement and promotion. Assistance is
also given under certain conditions to organisations
involved in the processing of citrus fruits, peaches,
pears, and tomatoes, as well as for the production of
grapes for drying, dried figs and dried prunes, and for
the storage of currants, dried figs, and sultanas.
Likewise, production aid is given for almonds, hazelnuts,
locust beans, pistachios, and walnuts.
The ornamentals sector accounts for 6.6% of agricultural
production on the EU, covering cut flowers, potted
plants, bulbs, shrubs, amenity trees etc. It is a
sector that receives no EU financial assistance to producers,
and no financial support through intervention
purchases or export subsidies. Production is worth
around €16 billion, with the main producers in value
terms being the Netherlands (30%), Germany (16%),
Italy (15%), France (14%), and the UK (7%).
Danish and German consumers buy the most ornamentals
in the EU (an average of €80 per inhabitant
per year). EU exports were worth about €1.493 billion
in 2001; imports in 2001 were about 8% of the
value of EU production and are governed by WTO
rules permitting application of tariffs and other measures
to protect the EU industry.
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