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European Union (EU) got an unique opportunity to reform the EU’s Common Agricultural Policy (CAP) and to utilize the fund in better ways as the higher commodity price has made the farmers less dependent on gover..

10 Oct 2011

LONDON (Commodity Online): European Union (EU) got an unique opportunity to reform the EU’s Common Agricultural Policy (CAP) and to utilize the fund in better ways as the higher commodity price has made the farmers less dependent on government support.

According to the new report by the Organisation for Economic Co-operation and Development (OECD), the European support to farmers has gone down substantially over the past 20 years. Farmers earned 22% of total annual receipts from government support in 2008-10, down from 39% annually over the 1986-88.

“Expected growth in demand and higher real commodity prices offer tremendous opportunities for farmers and government alike,” said Ken Ash, OECD director of Trade and Agriculture, during the launch of the report.

As per the existing policy, the large farm lands get large part of the income support despite above average income they receive. Now a window has opened to revisit the policy and make necessary changes.

The Commission has proposed to cut down the payments above €150,000 a year, with a cap at €300,000 and the farmers who employ large numbers of labors will be eligible to receive more than this amount.

"Modifying the distribution of payments by imposing ceilings on individual farms or excluding hobby farms would not address the problem” said OECD

According to Ash, the land aside program should be initiated at the time when food demands grows faster than supply.


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