Set aside for year 2008 (debate) 
President
The next item is the proposal for a Council regulation, under examination by the Committee on Agriculture and Rural Development, derogating from Regulation (EC) No 1782/2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers, as regards set aside for year 2008 - C6-0302/2007 -.
Mariann Fischer Boel
Member of the Commission. - Madam President, I can tell you that the cereal market outlook is clearly at the forefront of our minds, as we are in a situation where the prices have shown unprecedented growth in the recent months. This is not only the case within the European Union but all over the world.
With too much rain in certain parts of Europe and with droughts in other parts of Europe, the climatic conditions within our own regions this year have been adverse to cereal production and, with an estimated output of 258 million tonnes, the 2007 harvest is below average. A compulsory set-aside of the present 10% in the old Member States, the EU-15, is not compatible with the present market situation. Against this background, the Commission has proposed to set 0% on set-aside for the autumn 2007 harvest and the sowing in spring 2008. According to our estimates, this will mean extra production within the European Union of between 10 and 17 million tonnes, and I think this will send a positive signal to the sector and, hopefully, also contribute to stabilisation within the grain sector.
A rapid decision on this matter is clearly needed so that farmers can decide their next production year and, in this context, I am actually very thankful for the fact that Parliament obviously understood the urgency of the matter and agreed to follow the fast-track procedure. I really am very grateful.
Finally, our legal proposal will be as short and as simple as possible and it will not imply any new administrative burdens.
Looking further ahead, it is necessary, within the health check, to take a good look at whether the set-aside is still an appropriate tool in the present and in the future market circumstances. We also need to consider how we can retain the environmental benefits within our set-aside system, such as maintenance of permanent pastures, the protection of riparian strips and measures that are also linked to climate change.
So, thank you for a quick reaction. It is nice to see that Parliament can really move when it is badly needed.
Neil Parish  
chairman of the AGRI committee. - Madam President, Commissioner, yes, Parliament can move very quickly. Of course, the thought that Parliament could be blamed for the fact that farmers would not know what to plant on their land this year did concentrate our minds quite a lot, so we were delighted to work with you to be able to get to this firm decision. I also compliment my own committee, the Committee on Agriculture and Rural Development, on its unanimous decision.
The points I would like to raise really is, what a difference a year makes! Twelve months ago we were talking about EUR 90/tonne for wheat. Now we are talking about EUR 250-270, so we are talking three times the price. Now is the time, therefore, to look seriously at bringing set-aside down to 0%. I would even go further back than that. When you think that for 20 odd years now in Europe we have been talking about food surpluses, farmers are not really needed, that we have to turn the land over to something else and that food security does not really matter. All of a sudden food security does matter.
I think there is a moral argument here as well. When the world has plenty of food, then perhaps Europe does not need altogether to do its share of production, but when the world is short of food and the prices go up, then Europe is morally obliged to produce food. Europe is never going to starve, whatever the price of food is, because we basically have money to pay for it, but many parts of the world will. All of a sudden we are in a different world and one that we must face up to. The Commission is proposing a set-aside of 0% for 2008 and at the beginning of the marketing year 2008, like I said, the market is characteristically high in price.
As the Commissioner said, we have had droughts in some parts of Europe and we have had floods in others. We also see, throughout the world, changing situations on grain, where in Australia you have salt coming up through the land and it is becoming very difficult to plant. We are also seeing China and India taking in unprecedented amounts of food because of their economies increasing and wanting more food. All this is taking its toll on the wheat and cereal production throughout the world. We are now probably at about half the stocks that we historically have and stocks are getting low, so now is the time to do it.
I believe, Commissioner, and I am sure you do too, that if we have a common agricultural policy that is decoupled away from production, we cannot really have set-aside in many respects because, if ever there was a policy that was linked to production, then set-aside must be that, so now is very much the time to remove it.
As we remove set-aside, we must remember that there have been some environmental benefits to it and we must remember, too, that farmers will have the choice now as to whether to plough up set-aside land or not. Under single farm payment systems they could still carry on using it if they so chose, but the economic benefits of actually growing cereals will mean that many of them will plough the land. We can still have the six-metre strips around the fields and hedgerows on environmental means and I think that is also very good.
It is not really something to be debated tonight, but I think, in the health check, one of the things we will deal with is that there is no doubt that we will have to move to second generation biofuels and not actually use wheat and oil seed rape for biofuels. Again, a year ago I was very much in favour of that when prices were low, but now when prices are high we will literally only fuel that.
I recommend to Parliament that we deal with this swiftly. I thank all the groups for their support and I thank the Commissioner very much for her speedy response. Together I think we can come to the right decision. There are a few amendments here from the PSE Group and the Verts/ALE Group, most of which we will be able to support. One, however, I cannot accept - and that is a tax on the export of grain, because farmers have suffered low prices in the past. As soon as prices rise, please do not actually put a tax on it because that would not be quite right in my opinion. If we are going to deal with market forces we are going to have to face up to the realities of life.
Esther de Lange
on behalf of the PPE-DE Group. - (NL) Madam President, I would first of all like to thank the Commissioner for her presence this morning and now once again at this debate, which was added to the agenda at the last minute. Most of all, however, I would like to thank her for her proposal to remove the compulsory set-aside for the coming season. She complimented us on our speed, but the Commission has also shown that it is able to respond relatively quickly to developments within the market, which is now enduring a period of dwindling cereal supplies in the EU. It is expected that stocks will reach an all-time low at the end of this season at worldwide level too.
An instrument to control supplies, such as the compulsory set-aside that was introduced in 1992, therefore no longer has any real purpose. Consequently, it is only logical that the Commission is proposing that this obligation now be removed. It is also logical that the Commission is retaining the set-aside system and is only reducing the compulsory percentage from the current 10% to 0%. This will keep the debate on track. After all, only when it is time for the health check is it time to discuss a potential change to the existing regulations and structures.
Furthermore, I understand that, should we agree to this proposal and should the Council also make a swift decision, it is likely that we will break a record for passing legislation quickly. This will also send out a signal to citizens and to farmers in particular that, when necessary, the EU can also make rapid decisions.
There is just one more thing, however, that I would like to get off my chest, Madam President - not as a PPE spokesperson, but as a member of the CDA in the European Parliament from the Netherlands. There are yet other sectors in which, given the current market development, a certain degree of flexibility would seem appropriate. Take the dairy industry, for example, in which demand is increasing sharply and Europe is probably not making the most of its full potential. One option is probably to make quotas that are not fully utilised in certain Member States marketable across borders, or to increase the quota even further on 1 April 2008 by a few percent.
Finally, Madam President, I would therefore like to make a personal appeal to the European Commission to show the same drive that is now being exhibited in respect of cereals in other sectors too, as and when necessary.
Luis Manuel Capoulas Santos
I too am pleased to see the Commissioner here and should like to say that current conditions on the cereals market oblige us to reflect, but above all to act, and I congratulate the Commission on its proactive stance.
The Socialist Group in the European Parliament shares the Commissioner's analysis of the present situation and agrees that, within the health check, we shall have the opportunity to examine this issue in depth and take more fitting definitive decisions for the future. We are also fully aware that the problem facing us cannot be solved merely by eliminating set-aside in the context of the transitional measures we are preparing to take, but agree that they might help significantly to redress the balance of the market in the coming year.
We share the opinion that this measure might, in a pessimistic scenario, bring at least half of the current 3.89 million hectares back into production and that could represent, in a year with normal climate conditions, additional production of between 5 and 10 million tonnes at least, even though some land is of the less productive variety, which is naturally why the farmers set them aside.
We think, however, that in order to achieve this objective, it would be appropriate for the Commission to extend this derogation slightly, that is to extend the validity of the measure to two years rather than one; and it is understandable that it should be prolonged because it is obvious that there is a lack of programming for agriculture and at the beginning of the next Autumn-Winter season we shall still not have a definitive decision on the outcome of the debate we shall be holding within the health check. I therefore call on the Commission to take into account the amendment we will be tabling to that effect and which, I am sure, will merit a majority in tomorrow's plenary session.
On the other hand, we are all aware that bringing all this area back into production will have obvious negative impacts both as regards the release of CO2 from the ground, and as regards biodiversity, since everyone nowadays acknowledges the environmental added value which set-aside brought. We therefore think that it would be appropriate for the Commission to carry out an impact study as soon as possible so that we are able to have all the relevant factors available for taking the decision which we shall be obliged to take within a year on this same subject.
Friedrich-Wilhelm Graefe zu Baringdorf
(DE) Madam President, Madam Commissioner, yes, we have worked quickly, but the Commission has also been late in submitting its proposals. This has been discussed for a long time and the growers' impatience has pretty much been fuelled by the question of when it will finally be over. We have not held up anything, that is true, nor did we want to do that.
Your justification is that prices are high and some stabilisation was needed here. I hope we are both pleased - and especially your husband with his enterprise - that money will finally be reaching the enterprises. This has been long overdue, and we should be careful to say here that we must do something to push down prices. What is more, this somewhat contradicts your statement this morning in relation to sugar. You will remember that you said: with the price of grain as it is, people are now perhaps going faster into cereals and out of sugar. If you force grain prices down again now, your own logic and your own intention could be undermined with it.
You address the fact that this entails crop rotations. Yes, that is correct. Originally, this was a measure associated with crop rotation, since crop rotation also needed vegetation. This means we have to attend to the environmental aspect, even though this has been very much neglected in recent years, simply by making continual set-aside possible, whereby a large proportion would be taken into production for energy products.
We are asking you in an amendment not just to deal with what you have in mind for 2008, but also to tell us in Parliament how crop rotations are to be arranged with a view to environmental protection.
Vincenzo Aita
on behalf of the GUE/NGL Group. - (IT) Madam President, ladies and gentlemen, I believe that Parliament ought to see this as a new element, one which opens up a new period of reflection and a new debate on agricultural production in Europe. The point is not only that we have had a change in climate and that in some rural areas we have had production difficulties. The issue is that the entire system of agricultural production in this sphere is changing because, and there were some references to this in the previous debate, today many crops are being produced using different production systems, as we have heard.
The point is that we should now review the policy implemented for agricultural production in recent years by the European Community. It is not only grains that are the issue, but in a few months' time we will also have to tackle the problems of meat production and dairy production, because there are already changes in production and drops in production in this field. I therefore believe that the Commissioner and the Commission ought to have a careful period of reflection and enable Parliament to give a definitive response to these problems, to avoid the current situation: a rise in food costs that is causing problems for many families in Europe and elsewhere.
Jim Allister
Madam President, at a time of spiralling and punitive increases in feedstuff prices, which is so hurting our intensive sector, it would be criminal to lock out of production land capable of decreasing our reliance on foreign imports. Thus set-aside must go and must go now.
But more is needed, including a proactive plan to address the looming crisis in our intensive sectors. For my part, such must include hands-on pressure on the multinational supermarket chains to give up the pricing strategy which suppresses farm-gate prices. If this does not happen, we are facing wipe-out in much of our intensive sector. Such would be the greatest failure of agricultural policy of our time and something, Madam Commissioner, which you must urgently address.
Esther Herranz García
(ES) Mr President, to start with, I welcome the European Parliament's decision to adopt, by urgent procedure, the immediate abolition of mandatory set-aside.
I think that European consumers and farmers are the main victims of the massive increase in the price of agricultural raw materials. I think that the current situation should lead us to undertake an in-depth discussion on the shift that is currently occurring in the common agricultural policy, and we should ensure that the decisions adopted in this area are in harmony with the global context, in which the demands of third countries are growing at a staggering rate, in particular due to the growth in consumption of countries such as India and China, which play a decisive role in the global economy.
If this deficit situation continues, I think that the European Union should think about creating new mechanisms to avoid unsustainable increases in food prices.
For years we have been hearing that the common agricultural policy involves excessive costs for European taxpayers, but I would now like governments to explain to citizens why they will now have to pay more for bread and milk. I would also like governments to explain the measures that they are prepared to adopt in order to guarantee a fair price to consumers and prevent an excessive burden being placed on producers, which would endanger the profitability of many farms.
The world needs more and more food, and the exponential growth in consumption will not be resolved by an agricultural policy that is increasingly mean and stingy towards European producers. I think that European leaders should think twice before putting producers between a rock and a hard place.
I think that the European Union should use the health check on the common agricultural policy to introduce mechanisms that avoid serious deficit situations in the future, if we do not want other global producers to monopolise the international markets.
Rosa Miguélez Ramos
(ES) Madam President, it is true that cereal stocks have decreased in recent years and we have already heard some reasons relating to the current climate - increasing consumption in emerging countries, adverse climate conditions in producer countries or production being reserved for internal consumption in exporting countries. Neither can we forget the impact of certain speculative movements on the markets concerned, such as Paris or Chicago. All of these issues have contributed to prices reaching historic highs.
However, according to data from the International Cereals Council, in addition to the problem of supply there is a problem of reserves: global reserves, which are below 17%, which according to the FAO guarantee food security, and Community reserves, which are practically exhausted in a market with prices that are above international levels.
In my opinion, Commissioner, in view of the health check we should think about the role in this crisis of the disappearance of the Community instruments to regulate the market.
The European Union is obsessed with the costs of managing stocks and the pressure from the World Trade Organization; it has reoriented its agriculture policy towards containing production and liberalising the markets and has turned its back on producers and consumers, abandoning the fundamental principal of the CAP: guaranteeing self sufficiency.
Bernadette Bourzai
(FR) Madam President, Commissioner, ladies and gentlemen, I would first of all like to express my support for the recultivation, on a voluntary basis, of land that is currently set aside in order to boost European production of cereals and oilseeds, to replenish stocks and thus ensure our self-sufficiency.
However, two production and marketing years seem necessary to allow farmers to adapt to this change. It is also important that we apply quotas to cereal exports so that Europe's needs are met first.
Conversely, I am more cautious about the proposal for a measure abolishing taxes on animal feed. I am well aware that the increase in food prices makes things very difficult for farmers, but I would not want this measure to open the floodgates to imports of genetically modified soya and maize. However, I am in favour of promoting and encouraging the development of a European GMO-free animal feed industry, which would be in a better position to guarantee both our food security and our independence.
I would also like to point out that, although set-aside is no longer economically justified, it is vital for biodiversity and for soil and river protection, and this should be recognised and maintained. The Socialist Group is therefore asking the Commission to carry out an environmental impact assessment of the effects of scrapping the set-aside scheme. I am mainly thinking of the consequences that the abolition of set-aside would have on the necessary diversity of sources of pollen and nectar for bees, at a time when this sector is going through a serious crisis.
Finally, abolishing set-aside now will not help us resolve all of the problems at the heart of the CAP review in 2008 and 2009.
Mariann Fischer Boel
Member of the Commission. - Thank you, Madam President, and I should like to thank the Members very much for all the positive comments, for all the endeavours to stabilise our cereal market. I feel quite well equipped now to continue this discussion in the Council tomorrow with the Member States and I hope that the legal act can be published within a short period. I am quite sure farmers will be keeping an eye on us to see what decision will be taken here in Parliament and in the Council tomorrow.
I shall just speak briefly on the four different groups of amendments. On the idea of extending this one-year 0% set-aside to two years, I must say that we will have the possibility of discussing the communication during the winter and the legal proposals next spring and summer, when we will have a clear idea of which direction we are moving in. So I will not be able to support the idea of extending the one-year period, but we will return to this issue.
On the environmental benefits of the set-aside, it is obvious, as I said in my first intervention, that we will have to look into this in the health check to see whether we can find solutions to maintain the benefits of the environmental biodiversity issue in the set-aside.
On the monitoring of the cereal market, it is obvious that we will do everything possible to keep up a strong dialogue with Member States, stakeholders and the public at large to see in which direction the market is moving.
On Amendment 8 on export restrictions and the possible introduction of an export tax, I must say that this is not the way we want to follow. It will send totally different and wrong signals to the market. It will bring us into a situation similar to that of Russia and Ukraine, which we have both accused of using this tool to keep their production for themselves, and therefore this is not the way to follow.
Regarding the other idea that you mentioned on the import side, we will look - and we have actually started doing so already - into the suspension of cereal import duties. They do not fit with the present situation. A change of the entire policy, the stock policy, would, I think, be an option for us to discuss in the health check to find the best way to tailor-make solutions both to farmers and to cereal stakeholders, to the cereal sector.
Thank you, again, very much. I do really appreciate the enthusiasm with which Parliament and the Committee on Agriculture and Rural Development have acted in this case.
President
The debate is closed.
The vote will take place on Wednesday.
Written statements (Rule 142)
James Nicholson  
in writing. - A serious situation has developed through rising grain prices throughout the European Union which is being driven by high world prices. It is necessary that we have security in our food supply. We no longer have that. The cost of grain has continued to spiral upwards. This can only be dealt with through rising prices to the consumer. The Australian government last week said that Australian production this year will be down by 30%. We must have market access to cereal substitutes from the United States or the supply of beef, sheep and chicken meat will become more difficult. I call on the Agriculture Council and the EU experts to approve new cereals at a faster pace to guarantee us security of supply.

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