IENICA REPORT: SPAIN
Technical
considerations
Legislative matters
Economic issues:
subsidies and financial aid
Impact of Agenda
2000
TECHNICAL, LEGAL AND ECONOMIC CONSIDERATIONS OF ALTERNATIVE CROPS
TECHNICAL CONSIDERATIONS
In the coming years, agriculture will have to adapt to changes in market evolution, market policy and international trade regulations. These changes will also, of course, affect the local economies of rural areas, at a time when many of them are beset with serious problems of economic development. Furthermore, rural areas are being more and more called upon to fulfil major environmental and recreational functions.
With regard to this last point, a major role will be played by agro-environmental methods to encourage maintainable development in rural areas and respond to society’s ever-increasing demand for environmental services.
Measures concerning agro-environmental issues must be strengthened and encouraged through the increase in alternative crops.
Another possibility worthy of greater consideration is the taking into account of the fact that the least favoured areas and those of great natural value are often the same places, and gradually turning the system of related aid into a basic instrument for maintaining and encouraging systems of farming less dependent on input.
LEGISLATIVE MATTERS
ORDER of the 21st April 1998 concerning the Production Regionalization Plan for Spain, applicable to the system of compensation payments to be made to the producers of certain herbaceous crops in the 1998-99 season.
ROYAL DECREE 136-1986, No. 1462/1986 OF THE MINISTRY OF AGRICULTURE, FISHERIES AND FOOD CONCERNING FARM AND FISHERY PRODUCE AND THE EUROPEAN ECONOMIC COMMUNITY. Stimulation of the improvement of transformation and marketing conditions.
ROYAL DECREE 466/1990 of 64-1990 AGRICULTURE AND LIVESTOCK. Sets the compensation to be paid in certain depressed areas.
ORDER of the 11th September 1997, whereby base hectarages are established for the determination of compensation payments to be made to the producers of certain herbaceous products.
ORDER 1-3-1996 AGRICULTURE-EUROPEAN COMMUNITY. Regulations for co-financing regional plans of rural renewal under the auspices of the Community LEADER initiative.
ORDER 2-4-1997 COTTON-EUROPEAN COMMUNITY. Establishment of the area to be sewn with cotton for the period 1997-98.
ORDER 24-11-1997 FLAX AND JUTE-EUROPEAN COMMUNITY. Regulations for the requesting and granting of aid to flax and jute production in the sales period 1997-98.
ORDER 24-11-1997 AGRICULTURE-EUROPEAN COMMUNITY. Regulates, for the sales period 1998-99 (1998 harvest), the set-aside of plots benefiting from the compensation payments set out in EEC Council ruling 1765/1992 of the 30-6-1992, the specific regulations for aid to producers of oilseeds and the use of set-aside for growing non-food crops.
ORDER of the 27th November, 1997 regulating the procedure for requesting, channeling and granting aid to the producers of certain herbaceous crops in the sales period 1998-99 and the determination of hectarage for textile crops.
ORDER of the 8th July, 1998 establishing the regulations for requesting and granting aid to flax and jute for the sales period 1998-99.
ORDER of the 9th December, 1998 establishing regulations for the granting of aid for promoting the sale and consumption of flowers, aromatic plants and live plants.
ECONOMIC ISSUES: SUBSIDIES AND FINANCIAL AID
AID IN ANDALUSIA
Aim: Development and use of hillsides.
Target area: Rural areas in Andalusia.
Period: Open.
Granting body: Regional Department (Consejería) of the Environment.
AID IN ASTURIAS
Aim: Acquisition of machinery, auxiliary equipment and facilities for reforestation and the exploitation, handling, transformation and marketing of forestry products.
Target area: Principality of Asturias.
Period: Open.
Granting body: Regional Department (Consejería) of the Environment.
Aim: Handling, transformation and marketing of farm produce
Target area: Principality of Asturias.
Period: Open.
Granting body: Department (Consejería) of Agriculture.
Aim: Plans for improvement through all kinds of investment in farms.
Target area: Principality of Asturias.
Period: July.
Granting body: Regional Department (Consejería) of Agriculture.
Aim: New technology for farm machinery and equipment.
Target area: Principality of Asturias.
Period: November.
Granting body: Department (Consejería) of Agriculture.
Aim: Non-crop activities and remunerative investments, and instruction in new farm and forestry techniques.
Target area: Principality of Asturias.
Period: Open.
Granting body: Regional Department (Consejería) of Agriculture.
AID IN CASTILE AND LEÓN
Aim: Extensive agriculture.
Target area: Castile and León.
Period: December.
Granting body: Regional Department (Consejería) of Agriculture.
Aim: Marketing and transformation of farm and forest products
Target area: Castile and León.
Period: Open.
Granting body: Regional Department (Consejería) of Agriculture
AID IN CASTILE-LA MANCHA
Aim: Co-operativism, marketing and transformation of food products.
Target area: Castile-La Mancha.
Period: December.
Granting body: Regional Department (Consejería) of Agriculture.
Aim: Protection of the environment
Target area: Castile-La Mancha.
Period: Open.
Granting body: Regional Department (Consejería) of the Environment.
AID IN CATALONIA
Aim: Rural development under the LEADER II programme.
Target area: Municipalities in Catalonia.
Period: Open.
Granting body: Regional Department (Consejería) of Agriculture.
Aim: Transformation and marketing of farm, forest and fishery products .
Target area: Catalonia.
Period: Open.
Granting body: Regional Department (Consejería) of the Environment.
Aim: Development of the rural environment.
Target area: Municipalities in Catalonia.
Period: Open.
Granting body: Delegation of Rural Development of the Regional Department (Consejería) of Agriculture.
AID IN EXTREMADURA
Aim: Marketing of farm products.
Target area: Extremadura.
Period: Open.
Granting body: Regional Department (Consejería) of Agriculture.
AID IN THE BALEARIC ISLANDS
Aim: Farm production methods compatible with the protection and conservation of wetlands.
Target area: Balearic Islands.
Period: Open.
Granting body: Regional Department (Consejería) of Agriculture.
AID IN THE COMMUNITY OF MADRID
Aim: Marketing farm products
Target area: Madrid.
Period: August.
Granting body: Regional Department (Consejería) of Agriculture.
Aim: New farming technology and equipment
Target area: Madrid.
Period: Over.
Granting body: Regional Department (Consejería) of Agriculture.
Aim: Plant protection methods
Target area: Madrid.
Period: October.
Granting body: Regional Department (Consejería) of Agriculture.
IMPACT OF AGENDA 2000
Proposals of the Commission
Basically, the proposals for the reform of the cereal sector aim to continue the process begun in 1992. In principle, support prices will be cut by 20%. As for supply control, a tendency for prices to fall below those of the world market will reduce the need to limit production, as there are no limits to the amounts countries can export without subsidies. There would then be much less need to take land out of production.
The proposed cuts in support prices have not been completely offset by an increase in direct aid to income, but the Commission considers that, as far as is foreseeable, market prices will probably remain higher than support prices. This situation, together with changes in the behaviour of investors observed since the last reform, indicates that cereal producers will be able to keep their level of income.
Detailed proposals
Support prices will be cut by 20% as from the 2000-2001 season, falling from the present 119.19 €/t to 95.35 €/t., whereby support will again take on its original function as a safety net for farmers’ incomes, allowing EU farmers to benefit from export possibilities;
The Regulation of herbaceous crops proposes an increase in direct payments from 54 €/t to 66 €/t, exactly the same as for oilseeds and non-fibre flax. Non-specific payments for oilseeds remove the initial requirement for production hectarage limitations imposed by the Blair House agreement while allowing the Commission to repeal the specific provisions concerning oilseeds;
Once intervention has been stepped down, any seasonal price adjustments are no longer justified, so the system of monthly increases is suppressed, although no changes are foreseen in the support period;
The arrangements applicable to maize and sorghum, export rebates (especially on malt), minimum prices for potatoes for starch production and compensation payments to be made to producers of such potatoes will be adapted accordingly;
The idea of quality category will no longer mean anything, as intervention prices will be pegged to a given minimal quality, with no differentiation of any kind;
Compulsory setting aside of land will continue, but the normal percentage is fixed at 0%; if the percentage were higher, "small farmers" would remain exempt;
Voluntary setting aside will continue, but the system will be subject to certain improvements with the specific aim in view of protecting the environment: to be precise, conditions will be introduced regarding the minimum areas throughout the Community, while member States will be authorized to establish maximum areas; in relation to the environment, member States will be given the opportunity to bring in five-year programmes for set-aside in order to enhance the effects of the system on the environment;
To ensure the relative profitability of protein crops in comparison with others, they will be awarded a premium of 6.5 €/t in addition to the direct base payment of 66 €/t, with a consequent decrease in total aid to 72.5 €/t from 78.49 €/t.
The role of agriculture does not stop at the simple production of food and renewable energy. For centuries, farm production- by means of a system of land use adapted to natural conditions - has shaped landscapes of great beauty and rich in biodiversity. The total abandoning of farming could put this environmental heritage in jeopardy, with a resultant fall in biodiversity and an increased risk of erosion. Similarly, the intensification of land use, especially where production techniques are not suitable for local conditions, could also cause erosion, landslides and serious flooding.
Although agriculture has certainly made a vast contribution to the conservation of the environment and rural scenery, it is no less true that the use of more intensive methods has brought about new problems, including environmental deterioration. Increase in the use of fertilizers, pesticides and other means of production has increased the level of pollution of water, air and soil. The effects are more serious in some regions than in others, but the general intensification of land use, especially when production techniques are not adapted to local conditions, has brought about undesired consequences for the environment.
If agriculture were subject only to the dynamics of the market, undesirable results would also arise as farmers would abandon uncultivated land, with the consequent irreversible loss of valuable habitats and scenery.
The Commission has decide to propose a new framework based on paying farmers in return for environmental services.
Direct payments for oilseed and non-fibre flax rise from 54 to 66 € per tonne.
In order to ensure the profitability of protein crops in comparison with other herbaceous ones, an additional direct payment is proposed of 6.5 € per tonne, which would increase the total amount available for these crops to 72.5 € per tonne. In this way, farmers would be offered a contract whereby they would provide environmental services capable of satisfying the demands of society in general.
Strengthening of Agro-environmental Measures
As a key factor in the strategy for integrating the environment in farming policy, agro-environmental plans will remunerate farmers on a contractual basis for the provision of environmental services and the use of farming practices that are friendly to the environment. Owing to the diversity of natural conditions and farm structures, it will be important to conceive agro-environmental measures depending on the target regions, but without applying them, as is done today, via regional funds.
Specific measures include aid to the improvement of production cost effectiveness, ecological agriculture, ecology-based set-aside and the conservation of such valuable elements of the landscape as hedgerows, ditches and woods. To date, no fewer than 1,300,000 contracts have been signed, one for every six farms in the European Union.
Special Measures for Depressed Areas
In depressed areas, whose difficult natural conditions mean low agricultural production, the Union gives direct aid to farmers in the form of compensation and aid to investment when conditions are favourable.
One of the basic aims has been to ensure the continuation of farming activity, which in many areas constitutes a pre-condition for maintaining scenic beauty and habitats of environmental value. Under current conditions, more than half the agricultural land in the EU (56%) is considered to be depressed, half of it being in mountain areas.
The Commission proposes maintaining the present system of compensation payments to depressed areas and making it compatible with a set of minimal environmental requirements. As before, payments will be granted in compensation for natural disadvantages. Member States must ensure, however, that such payments are used to help sustainable farming.
Both in its natural aspects and in man-made ones, the environment is of primordial importance within the new generation of rural development programmes destined to become operative as from the year 2000. These programmes will include measures to aid any form of management of the environment in rural areas aimed specifically at improving the soil, water management and the elimination of the effects of natural disasters. Furthermore, measures have been included in the programmes to contribute to the conservation of Europe’s rural heritage, including village renewal.
Conclusion
The introduction of alternative crops yielding non-surplus products will prevent the mass abandoning of farmland and will stimulate the development of depressed areas, encouraging the use of cultivation techniques that are perfectly compatible with the environment.