An agricultural roadmap narrowed down to the essentials

“This is a time for Europe”, this is how the program of the French Presidency of the EU Council (FPEU) opens, with reference to health and climate issues. This reference also applies to agriculture well: 2021 was one of the most active years I have ever seen for agricultural initiatives in Brussels.

While with the rise of the Green Deal, the CAP remains the main European policy and the historical cement of the EU, it is clear to us that the CAP is no longer the only policy that has a significant impact on agriculture.

The ‘Farm to Fork’, ‘Biodiversity 2030’, ‘methane’, ‘soil’, ‘forest’, ‘phasing out of cages’ strategies,
and the ‘Fit for 55’ package are all initiatives whose guiding principles were sketched out in 2021
and which will have to be translated into legislative proposals from 2022 onwards, partially
under the French Presidency. The same observation applies to the review of the EU trade policy,
with the potential conclusion of the EU-Australia and the EU-New Zealand trade deals and the
uncertainties related to the ratification of the EU-Mercosur agreement.

All these initiatives propose profound changes that will redefine our agricultural model for
decades to come. On the ground, European farmers are already engaged in multiple transitions.
From a political point of view, for the farming community, the most important is coherence:
coherence between these different initiatives at local, national, and European level, but also (and
above all) coherence with our trading policy.

Throughout the year 2021, we have tried to promote this twofold demand for European coherency, adding to it a clear and recurrent request for a comprehensive study on the cumulative impacts of these initiatives. However, let’s be clear, while we have seen that the European legislator was creative with regards to the requirements imposed on its producers, the chapter dedicated to the proposals to ensure fair competition with our international trade partners often remained very vague and lacked the same ambition.

In this context, the roadmap presented by the French Presidency of the European Union, which focuses on the debate ensuring fair competition in the context of, “Strengthening the strategic autonomy of the Union” is very relevant for Copa-Cogeca. The Commission has argued that it may breach WTO rules, exposing the EU to potential legal and economic retaliations.

In this regard, we will examine with great attention the report that should be published by the
Commission by June 2022, on the feasibility to apply our standards to all imports coming into
the EU. The farming community has been consistent in its calls for fair competition. In
principle, imports into the EU should mirror the high requirements that EU farmers have to implement.

This subject is THE cross-cutting issue that will determine, to a large extent, the ambition and success of the Green Deal in agriculture. Copa-Cogeca supports trade within the EU and with third countries, but trade must be based on balanced, fair and transparent rules to avoid 2| 3distortion of competition. We will remain vigilant and contribute to the debate on mirror measures and more broadly on the way to integrate sustainability and the Paris agreement goals in international trade.

If there is a second point in the French Presidency’s roadmap that we feel is also essential, it is
the emphasis placed on the development of ‘carbon farming’. This initiative will be positive if it
enables agriculture to be more sustainable, delivers on climate benefits and ensures an
additional income for farmers. The two key dimensions of the popular success of this new
business model for farmers are carbon pricing and market-based instruments.

The European legislative package ‘Fit for 55’ is paving the way. However, the EU’s new soil protection strategy, the biodiversity 2030 strategy, and the Nature Restoration’s objectives will also have to be
consistent with the key role of agriculture in carbon storage. We will also ensure that farmers are
rewarded not only for their participation in increasing carbon sequestration, but also in reducing greenhouse gas emissions.

In terms of international trade, the proposal to set up a carbon border adjustment mechanism to
prevent carbon leakage is also interesting. The main studies released around Farm to Fork show
that this carbon leakage effect has the potential to largely wipe out all the efforts made by European farmers. For the moment, the Commission has decided to exclude agriculture, even though the production factors that are essential for the continuity of agricultural activity (mainly fertilisers) will be subject to this mechanism.

Not only would this reduce the competitiveness of European agriculture, but it would also lead to carbon leakage from the agricultural sector by favouring imports of agricultural and food products with a higher carbon footprint. It should be rectified by excluding the fertiliser sector or developing a tool to prevent carbon leakage in agriculture. But given the very little political willingness to remove the fertiliser sector from the Commission proposal, it is of utmost importance to improve the proper functioning of the fertiliser market in the short run.

Next Monday, the first meeting of the Agri-Fisheries Council under the French Presidency will
take place. We are counting on the FPEU to bring forward an ambitious and strategic vision for
European agriculture, by putting food and environmental issues back into perspective. This is an
important deadline, and our expectations are high!