EU targets fruit, vegetables sector for reform
Source: Reuters
(adds detail, quotes) By Jeremy Smith BRUSSELS, Jan 24 (Reuters) - Europe's agriculture chief unveiled plans on Wednesday to overhaul the EU's vast fruit and vegetables industry, revising or scrapping many of the annual 1.5 billion euros ($1.95 billion) of subsidies paid to farmers. If farm ministers agree, the reform plan would decouple subsidies for producing and processing fruit and vegetables -- EU jargon for breaking the link between how much a farmer produces and the amount of subsidy received from Brussels. In future, that cash would be calculated by area based on historical payments for each fruit or vegetable product, as part of the streamlined single farm payment scheme agreed under the EU's mammoth agriculture reform in 2003. Fruit and vegetables farmers who get these new-style production payments would also have to spend at least 20 percent of them on projects to enhance or preserve the environment. Export subsidies for the fruit and vegetables sector, which accounts for nearly a fifth of EU agricultural output, would be scrapped. The plan should be presented to farm ministers next week although its details will not be debated for some months. Authored by EU Agriculture Commissioner Mariann Fischer Boel, it also aims to dilute the power of large food retailers that account for between 70 and 90 percent of all food retailers in Britain, France, Germany, the Netherlands and Nordic states. "It's no secret that the retail sector, now highly concentrated, has an astonishing power to set prices," she told the European Parliament's agriculture committee. "Many agricultural sectors have to cope with this problem. But the supermarkets seem to have the fruit and vegetable sector in a particularly strong arm-lock," she said. The EU is a major player in world horticulture, with wide variations in the types of products grown. The plan would also extend the regime to include culinary herbs. Its subsidy regime covers dozens of products including nuts, fruits like melons, grapes, pineapples and quinces, and vegetables such as onions, mushrooms, radishes and cucumbers. COUNTER POWER OF RETAILERS To counter the price-setting power of large retail chains, Fischer Boel's blueprint contains several ideas to streamline producer organisations (POs), which directly receive subsidies to fund marketing projects on behalf of smaller farmers. "It is through producer organisations that individual producers can stand up to the retail giants. In some parts of the European Union, this is what happens. But not in all," she told the parliamentary committee. "There are far too many producers who go it alone -- and find that they are no match for the retailers," she said. One of the main changes is to alter the way POs receive EU cash to withdraw perishable produce from the market if it is not selling well. Most withdrawals now qualify for 100 percent financing from Brussels, but that will be cut to 50 percent. But if those products are earmarked for free distribution, the EU will continue to pay all the cost, as part of the Commission's drive to promote healthy eating and combat obesity. More cash would be channelled into promoting consumption of fruit and vegetables, especially among children. "We want to make a special effort to boost fruit and vegetable consumption," Fischer Boel told a news conference. "The WHO recommends average daily consumption of 400 grams of fruit and vegetables. Currently, only Greece and Italy reach this level -- that is why we need to redouble our efforts to stimulate consumption," she said. Britain, Ireland and Sweden have the EU's lowest daily per capita intake of fruit and vegetables, Commission figures show. The plan would also see the EU paying for market withdrawals that would be distributed free in schools, holiday camps, public institutions, with a budget of 48 million euros over six years.
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