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1 EUROPEAN UNION: ESTIMATES of SUPPORT to AGRICULTURE Contact Person

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1 EUROPEAN UNION: ESTIMATES of SUPPORT to AGRICULTURE Contact Person EUROPEAN UNION: ESTIMATES OF SUPPORT TO AGRICULTURE Contact person: Morvarid BAGHERZADEH Email: [email protected] Tel: 33 (0)1 45 24 95 54 Fax: 33 (0)1 44 30 61 01 DEFINITIONS AND SOURCES Table 1. Agricultural Support Estimates / Total Transfers contains country Total Support Estimate (TSE) and derived indicators, which cover all agricultural production, i.e. all agricultural commodities produced in the country. Definitions of basic data sets refer to the specific programmes applied in the country. For the Producer Support Estimate (PSE) and Consumer Support Estimate (CSE), each policy measure is classified according to implementation criteria, which include: the transfer basis of support (output, input, area/animal numbers/receipts/income, and non-commodity criteria); whether support is based on current or non-current basis; whether production is required or not to receive payment. Each policy measure is also assigned several “labels” indicating additional implementation criteria. "MPS commodities", which vary across countries, are those for which the market price support is explicitly calculated in Tables 4.1 – 4.21. Table 2. Breakdown of PSE by Commodity and Other Transfers provides a breakdown of the total PSE into four categories reflecting the flexibility given to farmers regarding which commodity to produce within the various policy measures. These categories are: Single Commodity Transfers (SCT); Group Commodity Transfers (GCT); All Commodity Transfers (ACT); and Other Transfers to Producers (OTP). All data sets in Table 2 come from Tables 1 and 3.1 – 3.21 where definitions are included. Tables 3.1 – 3.21 Producer Single Commodity Transfers contain producer SCT by commodity, which are calculated for the European Union for the following commodities: wheat (common wheat, durum wheat), maize, other grains (barley, oats), rice, oilseeds (soybeans, sunflower, rapeseed), sugar, milk, beef and veal, pig meat, poultry meat, and eggs (Tables 3.1-3.20) provided that the value of production of that commodity exceeds 1% of the total value of production. In addition, SCT for “other commodities” is also calculated (Table 3.21), which covers transfers to single commodities other than MPS commodities. All data sets in the calculation of producer SCT by commodity come from Tables 1 and 4.1- 4.21 where definitions are included. Tables 4.1 – 4.21 contain Market Price Support (MPS) and Consumer Single Commodity Transfers (consumer SCT) by commodity, calculated for the same set of commodities as Tables 3.1 to 3.21, as well as potatoes, tomatoes, plants and flowers, and wine. Definitions are provided only for basic data sets from which all the other data sets in this table are derived. Definitions of the indicators, criteria for classification of policy transfers included in support estimation, and methods of calculation are contained in the PSE Manual (OECD’s Producer Support Estimate and Related indicators of Agricultural Support: Concepts, Calculations, Interpretation and Use). 1 European Union (EU) corresponds to EU12 for 1986-94, to EU15 for 1995-2003, to EU25 for 2004- 06 and to EU27 from 2007-2013 and EU28 from 2014 onwards1. It includes ex-GDR as from 1990. Levels of production and consumption are on a crop year for crops and on a calendar year for livestock products. For example, 2000 production and consumption data for crops refer to the crop year 2000/01. Producer price and reference price for all products are on a calendar year. Budgetary payments are on a fiscal year basis (1 November-31 October). Payments and levies for crops, livestock and the single payment in fiscal year t+1 are allocated to the PSE in year t, for example, payments reported in the 2000 PSE refer to fiscal year 2001. The Common Agricultural Policy (CAP) is composed of two pillars, with two separate funding sources. Pillar I is funded by the European Agricultural Guarantee Fund (EAGF). It defines and funds market measures under the Common Market Organisation, and includes the Basic Payment Scheme (BPS), (previously the Single Payment Scheme (SPS2)), the Greening payment, the Young farmers scheme and the Single Area Payment Scheme (SAPS), together with a number of optional schemes. Pillar II, or Rural Development Regulation, funds come from the European Agricultural Fund for Rural Development (EAFRD) and member states’ national budgets. Pillar II contains various measures co- financed by EU member states, including agri-environmental schemes, payments to less favoured areas (LFA), rural development and investment assistance. Prior to 2007 the European Agricultural Guidance and Guarantee Fund (EAGGF) funded the CAP. It was composed of two sections: the Guarantee section and the Guidance section. The Guarantee section of the EAGGF (European Agricultural Guidance and Guarantee Fund): Spending under the EAGGF Guarantee fund covers direct payments to farmers, market intervention measures, export refunds, as well as co-financing with national budgets for agri-environmental, afforestation, early retirement and other Rural Development Regulation (RDR) measures. With the Agenda 2000 Common Agricultural Policy (CAP) reforms, the EAGGF Guarantee fund became the main source of funding for all agricultural expenditure. Guidance section of the EAGGF: The EAGGF Guidance fund section, which is one of the EU's Structural Funds, co-finances measures to assist structural change in the agricultural sector and to promote rural development. Specific measures include investment aid, schemes to help young farmers set up for the first time, training activities, support for processing and marketing of agricultural and forestry products and rural infrastructure projects. With the Agenda 2000 CAP reforms, the EAGGF Guidance fund finances RDR measures under Objective 1 (regions which are lagging behind) and the EU rural development initiative (LEADER PLUS). In addition, national policies are also taken into account: Expenditures by EU member States (national contribution to EU payments or purely national or local expenditure), that are mainly paid on a fiscal year basis, were, as far as possible, allocated to various generic measures in the different PSE categories. Efforts to improve the policy coverage and classification of national measures will continue. 1 Croatia was included in the EU PSE calculations as from the year 2014. 2 http://ec.europa.eu/agriculture/direct-support/pdf/factsheet-single-payment-scheme_en.pdf 2 LIST OF ACCRONYMS ACT: All commodity transfers BPS: Basic Payment Scheme CMO: Common Market Organisation COP: Cereals, Oilseeds and Protein crops EAFRD : European Agricultural Fund for Rural Development EAGF: European Agricultural Guarantee Fund EU: European Union GCT: Group Commodity transfers LEADER: Links Between Actions for the Development of the Rural Economy LFA: Less-Favoured Area LU: Livestock Units MGA: maximum guaranteed area. MGQ: maximum guaranteed quantities. RDP: Rural Development Plan RDR: Rural Development Regulation SCT: Single Commodity Transfers SAPS: Single Area Payment Scheme SPS: Single Payment Scheme TNA: Transitional National Assistance VCS: Voluntary Coupled Support 3 TABLE 1. EUROPEAN UNION: Total Support Estimate This table contains the EU’s Total Support Estimate (TSE) and derived indicators, which cover all agricultural production, i.e. all agricultural commodities produced in the country. Definitions of basic data sets refer to the specific programmes applied in the country. For the Producer Support Estimate (PSE) and Consumer Support Estimate (CSE), each policy measure is classified according to implementation criteria, which include: the transfer basis of support (output, input, area/animal numbers/receipts/income, and non- commodity criteria); whether support is based on current or non-current basis; whether production is required or not to receive payment. Each policy measure is also assigned several “labels” indicating additional implementation criteria. "MPS commodities", which vary across countries, are those for which the market price support is explicitly calculated in Tables 4.1 – 4.21. Definitions: I. Total value of production (at farm gate): Total agricultural production valued at farm gate prices, i.e. value (at farm gate) of all agricultural commodities produced in the country [1]. I.1. Of which share of MPS commodities (%): Share of commodities for which MPS is explicitly calculated (in Tables 4.1-4.21) in the total value of agricultural production. II. Total value of consumption (at farm gate): Consumption of all commodities domestically produced valued at farm gate prices, and estimated by increasing the value of consumption (at farm gate) of the MPS commodities according to their share in the total value of agricultural production [(II.1) / (I.1) x100]. II.1. Of which MPS commodities: Sum of the value of consumption (at farm gate prices) of the MPS commodities as indicated in Tables 4.1-4.21. III.1 Producer Support Estimate (PSE): Associated with total agricultural production, i.e. for all commodities domestically produced [Sum of A to G; when negative, the amounts represent an implicit or explicit tax on producers]. A. Support based on commodity outputs A.1. Market Price Support: On quantities domestically produced (excluding for on-farm feed use -- excess feed cost) of all agricultural commodities, estimated by increasing the MPS for the MPS commodities (sum of the MPS for the MPS commodities listed in the rows below) according to their share in the total value of agricultural production [(ΣMPS commodities)
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