MEMO/01/98
Outcome of the Agricultural Council, 19 March 2001
BSE – state of play on the beef market (GK)
The Council discussed the latest developments on the EU beef market. Presenting
the state of play the Commissioner said that EU-beef consumption was still 25%
lower than under normal circumstances. Fischler further hinted at first slight signs of
improvement. «The market hit hardest by the crisis is Germany. However, for the 5th
week we have seen that prices for young bulls are getting slightly better. The two
Member States which have been in the compulsory safety-net intervention, Germany
and the Netherlands, are now ready to leave it again, because their prices are now
over the 60% benchmark. This positive trend is the consequence of slowly
recovering consumption. The export performance of about 10,000 to 15,000 tonnes
a week is - under the present adverse circumstances - quite satisfying. Fischler
stressed that the EU market measures were starting to show a positive effect. By
applying public intervention and the purchase for destruction scheme up to now
240.000 tonnes of beef have been withdrawn from the market.
Referring to the food and mouth disease, Fischler said. «Coping with the BSE crisis
or FMD seperately would already be an enormous challenge for the European
agriculture sector. Now they are striking at the same time. And the silver lining on the
horizon of the beef market might turn out to be an illusion if consumers turn their
back on meat all together. In this case, the Commission obviously would have to
revise its market and financial forecast for 2001.»
Report on plant proteins in the light of the meat and bone meal ban
(GK)
The Commissioner presented a Commission report on the supply of plant proteins to
satisfy the additional demand for plant protein in animal feed. The demand mainly
stems from the ban on uses of processed animal proteins (PAP) in farmed livestock
feed adopted by the Council in December 2000 to reinforce guarantees to
consumers on the safety of food.
According to Fischler, there is no major problem to replace protein from animal meal
by protein from plants. He pointed out that the relatively limited quantities of soya
meal needed to satisfy this additional demand for protein (1-1.5 Mio t) could easily be
imported, adding only some 5% to our current imports of soya meal. «The additional
demand of protein is expected to be covered by a combination of domestic cereals,
imported soya meal and improved efficiency in feed use. Soya meal is the best
suited to replace PAP. In the immediate future, the main substitutes for PAP will be
cereals and soya meal.», Fischler stressed.
In the report presented today to the Council, the Commission analysed the following
options to promote the cultivation of plant proteins in the EU:
1. Increasing the oilseed payments to 75€/t
Re-introducing crop-specific aid for oilseeds would mean that the EU-production
remained limited under the Blair House agreement. This solution would be costly.
The opportunity cost would be some 1.270 € per additional ton of soya meal
equivalent, or six times the price of soya meal. Most of the additional aid would
benefit the area, which would also be sown under Agenda 2000 conditions. In other
words: it would give additional economic support to oilseed producers for what they
already produce.
2. Increasing the protein crops (peas, beans, sweet lupins) payments
With the current price relationship between cereals and protein crops, the increasse
of protein crops would be very limited while the extra budgetary costs for this aid
increase would be substantial.
3. Authorising the production of protein rich crops on set-aside land.
Allowing to grow protein crops on set-aside land would seriously weaken set-aside
as a tool for regulating the supply of cereals. This would not be a step to be taken
lightly in view of the importance the EU attaches to the Blue Box as a contribution to
the process of agricultural reform. A basic requirement of Blue Box payments is that
they are given under production limiting programmes.
4. Promoting the production of dried fodder:
Dried fodder is mainly fed to ruminants for which animal meal is already forbidden
since a number of years. It is not suited for pig and poultry feed. Furthermore it is
questionable whether an increase of the maximum guaranteed quantities for dried
fodder would lead to increased protein production, given the maximum guaranteed
quantity is estimated to be overshot by 12% in 2000/01 also without additional aid.
Fischler concluded that economically speaking there was no sound reason to
introduce new or increase existing support schemes for proteins in the EU.
«Furthermore, I do not see a possibility to allocate more money within the current
farm budget However, the Commission is open to any alternative feasible option,
provided that such an option avoids the disadvantages that characterised the options
analysed by the Commission.», Fischler said.
Following a discussion, the matter was referred to the SCA for further examination.
Reform of the cotton sector (GK)
Following the opinion given by the European Parliament, the Council discussed the
Commission proposal to reform the cotton regime. While maintaining the present
guide price level of 1,063 euro per tonne as well as the level of guaranteed national
quantities, the proposal foresees an increased penalty rate in order to limit the
production and to achieve budgetary discipline. According to the proposal, the aid
would be reduced by 0.6% (the «stabiliser») of the guide price (instead of 0.5% in the
past), if the national quantities were exceeded by 1%. The Commission also
proposed that Member States should draw up objective environmental criteria for the
cotton production and they should, if necessary, restrict eligibility for the aid to certain
areas.
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Fischler underlined that a new regime under all circumstances would have to take
into account the budgetary restrictions and the environmental aspects of cotton
production. «Therefore alternative proposals which cost more for the EU-budget and
do less for the environment are not acceptable.» He reminded his colleagues of the
fact that for social reasons cotton production was already benefitting from a much
higer aid level than other crops. He called upon the Member States to take a
decision in the next Council so that the new regime could enter into force from the
marketing year 2001/02 on.
The Council concluded instructed the Special Committee on Agriculture (SCA) to try
to resolve the remaining open point (the percentage-level of the stabiliser) so that a
decision could be taken in April.
Reform of the sugar sector (GK)
The Commissioner stressed that in the light of the opinion given by the European
Parliament the Commission would be prepared to look into a prolongation of the
existing sugar quota regime for more than two years, provided that the other
elements of the Commission reform proposal would be retained. He called on the
Council to make the necessary preparation to enable a quick decision. «We need a
decision soon, also because major parts of the existing regime run out end of June
and we want to avoid a legal vacuum.», he declared.
The Council concluded that the issue would be further discussed in the SCA and in
the next Council.
Exchange of views on Foot-and-Mouth Disease (BG)
Mr Byrne updated the Member States on the situation on Foot-and-Mouth Disease
and recalled the strict measures taken at the EU-level to prevent the further spread
of the disease. He said that the EU could take considerable comfort from the very
decisive action taken by the UK and French authorities. He regretted that third
countries had not acknowledged the firm action taken at European level. The
Commission is currently establishing with third countries concerned the basis and
rationale for the restrictions adopted. He explained the Commissions approach to
vaccinationan against FMD and asked Member States for their views on this subject.
It can be concluded that Member States supported the UK and France in their
current strategies to eradicate the disease. No Member State advocated immediate
preventive vaccination in the EU. Some Member States however would wish to have
a more general debate on the EU´s approach to vaccination in due course. Mr Byrne
outlined that the revised EU-proposal on FMD which is already in preparation for
some time would review our FMD-policy and also elaborate on criteria for the use of
vaccination based on scientific advice.
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Debate on BSE (BG)
The Council had a debate on current developments on BSE. Mr Byrne updated the
Ministers on preliminary figures on testing in Member States which will be
consolidated shortly. He also updated the Council on the forthcoming Commission
proposal to exempt certain third countries from the obligation to remove for all
imports to the EU in meat and meat products so-called specified risk materials
(SRM) like brain and spinal cord. This obligation will enter into force soon for third
countries. The proposal is in the Commission today and will be put forward to the
Standing Veterinary Committee tomorrow.
Member States supported the view that the same rules on SRM-removal should
apply to third countries in the view of the assessment of the SSC that BSE might be
present in many third countries.
The Council also had a debate on the prohibition to feed meat-and-bone meal to
animals (MBM-ban). Several Member States favoured a prolongation of the EU ban.
Mr Byrne and the Presidency explained that the Commission will present a report to
the Council in April with a view to discuss it in depth.
Spain raised the problem of feeding animal carcasses to vultures and claimed that
the SRM-removal obligation would prevent the feeding of these endangered species.
Mr Byrne explained that ruminant carcasses can still be fed to wild birds, but that
SRMs would need to be removed beforehand.
Discussion on Animal Transport (BG)
On the request of the German delegation the Council held a short debate on the
necessity to improve animal welfare and animal transport conditions in Europe. Mr
Byrne informed the Council that the Commission is in favour of improving regulations
and would soon come up with a proposal to improve the ventilation and humidity
systems of trucks for animal transports. Nevertheless he reminded Member States
that many problems arleady arise through weak implementation of existing rules and
called upon Member States to attach priority to the strict implementation of existing
legislation.
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