The rise in foodstuff prices, consumer protection (debate) 
President
The next item is the debate on
an oral question - B6-0321/2007) concerning the rise in foodstuff prices and consumer protection by Joseph Daul, Lutz Goepel and Neil Parish, on behalf of the PPE-DE Group to the Commission,
an oral question - B6-0377/2007) concerning the rise in foodstuff prices and consumer protection by Luis Manuel Capoulas Santos, on behalf of the PSE Group to the Commission, and
an oral question - B6-0378/2007) concerning the rise in foodstuff prices and consumer protection by Sergio Berlato, Janusz Wojciechowski, Gintaras Didžiokas and Liam Aylward, on behalf of the UEN Group to the Commission.
Neil Parish  
author. - Mr President, it is with great pleasure that I stand up and talk tonight because we are in a situation now where food security has become a real issue. For 25 years we have been in a situation where there has been plenty of food in Europe. In fact, we have been taking many decisions in agriculture, in the common agricultural policy, to restrict production in order to maintain prices and reduce the use of export subsidies and to export products on to the world markets.
Now we are facing a situation that is completely different: cereal prices have risen threefold this year; the livestock sector is having a huge problem, having seen its feed costs going up by perhaps 50% or 60%, and we are extremely concerned about this. Mr Daul, Mr Goepel and I have tabled this oral question - and we are delighted that Commissioner Fischer Boel is here tonight - because we feel we now have to look at every opportunity for getting extra feed into the European Union.
We will have to face up to the reality that there are some feeds that are derived from GM maize and GM soya which cannot come into the European Union at the moment because they are not licensed. I think we have to make sure that we look at this and that we have a system by which we can license these products. Provided they are safe, they should come in to be fed to our poultry, and to our pigs in particular, as well as to our cattle, both beef and dairy, because we need to keep a very competitive industry.
We also have to look at the situation regarding supermarkets, because - do not forget - not only are we concerned at the price that the farmer receives for his or her products, but we are also interested in what the consumer has to pay. There is no doubt that we are seeing, for instance, that only 10% of a loaf of bread is actually made from the raw material of wheat and yet there are huge increases in the price of the loaf because the supermarkets say they are having to pay so much more for wheat. So we need to put pressure on the supermarkets to make sure that consumers are paying the right price.
It is great that it puts European agriculture in a very strong position to face up to the brave new world, because we will need food production, we will need farmers and we need the countryside, and all these things work very well.
But, as I say, we now have to get the balance right between the cereal and livestock sectors, and that is why we have tabled this question. We shall be delighted to hear what Commissioner Fischer Boel has to say about it.
Luis Manuel Capoulas Santos  
author. - (PT) Mr President, Commissioner, it is a pleasure to see you again here in Parliament. As you know, we were surprised a few months ago by a change in the situation in the market for some agricultural products, which not long ago we believed to be unthinkable; an enormous pressure on supply, with the consequences that we have been seeing.
This in turn caused a major disturbance in the livestock production sector, foreseeable consequences in the rise of consumer prices and not forgetting the FAO's warning about the consequences for foodstuffs in many areas of the world that could result from this situation. Let us not forget that while in Europe we spend 10-20% of household incomes on food, there are societies where this item accounts for 90% of income or more, and it is easy to imagine what a price rise would mean to these vast populations that are already so deprived.
Therefore we need to act, and act immediately; and I am very pleased that the Commission has acted swiftly - and well - by taking some palliative measures, reducing the set-aside for 2008 to zero. It is a shame we did not go further. There are other measures that could perhaps be adopted without additional cost to the Community budget, such as advance authorisation of payments to certain livestock farmers of the aid they are entitled to, who are of course doubly affected not only by rising prices, but also by having to deal with livestock diseases, such as 'bluetongue', and so I think we could go a little further just now.
However, most of all we must go further in assessing and studying the situation so that we can quickly identify the measures that, in the short term, can be adopted in the immediate future. We naturally place our trust in the sensitivity of the Commissioner and the Commission in following up this concern of ours.
Sergio Berlato
author. - (IT) Mr President, Commissioner, ladies and gentlemen, throughout Europe we are seeing across-the-board increases in the price of foodstuffs. Market surveys carried out show how European consumers are radically changing their eating habits, being forced to change the quality and type of products that they buy as a result of the exorbitant prices.
These increases can be blamed on the one hand on the excessive number of intermediate phases that products must go through from the producer to the consumer, and on the other on the disproportionate increases applied by major supermarket chains. One thing is certain however: the blame for these increases cannot and must not be placed on our farmers, who are the main victims of this worrying situation.
Mr President and Commissioner, we believe that today more than ever, the European agricultural model must be protected in order to shield national agricultural markets from international price fluctuations and give substance to the defence of models of production and use of the territory which are so characteristic of European agriculture. We welcome the Council's recent decision to ratify the proposal for zero set-aside for 2008.
However, this does not do enough to reassure us about the worrying situation in terms of cereal stocks and the rising price of cereals on the world market. We also need to work with the various CMOs and make good use of these mechanisms for rebalancing the market, which would help ease food prices, at least in the internal market. We asked the Commission, in a recent question, to propose an immediate increase in milk quotas of at least 2-3% to help stabilise the price of this staple product.
In a difficult economic climate such as this one, the European Union and the Member States have a responsibility to help consumers maintain their food purchasing power while at the same time protecting our farmers' right to an income.
Mariann Fischer Boel
Member of the Commission. - Mr President, I recall what I think is an old Japanese curse: 'May you live in interesting times', and I think this is exactly what we are doing now. We have seen, over the last six to eight months, prices for raw materials within the agricultural sector rocketing, as mentioned already by the speakers, but I have to say that this is happening from an historically low level. I think this is an important reminder to all of us. These increases in prices will be reflected on consumer prices but to a lower extent. If I may use the example of bread, a basic commodity - and I will use a German example - if you take the price of bread in a supermarket or in a store in Germany, only 4% of the price relates to the price of the cost of the wheat.
For the dairy sector, as has been mentioned already, a number of different measures have already been foreseen. Milk quotas were increased on 1 April 2006 and 1 April 2007 by 0.5% in 11 Member States. On 1 April 2006, eight new Member States received this restructuring reserve varying from between 2% and 5% of their national quota level. On 1 April 2008 - next year - another 0.5% will be added to the increase in the quota allocated to 11 Member States.
In addition, all market support aids have been massively reduced and, at the moment, there are no export refunds and no disposal aid at all - zero for both of them. The market outlook report in the dairy sector will be adopted by the Commission later this year and it will provide us with the basis for a further discussion on whether we need to increase again the quota. Moreover, I have already had the chance here to signal clearly the expiry of the milk quota system by 31 March 2015, and indicated as well that we needed, for the period from now until 2015, a soft landing for the abolition of the quota system. Among the possibilities mentioned is to increase the quota system over the period and we will have the possibility to discuss this during the health check next year.
In the cereals sector there are various different reasons for the increase in prices. I shall just say, just to be sure that there are no misunderstandings, it is not biofuels that are causing the steep increase in prices. We use, today, less than 2% of cereal production for ethanol in Europe, but the reasons are different: adverse weather conditions in Australia, drought in southern Europe, floods in the northern part of Europe, increasing demand from India and China, and restricted exports out of Russia and Ukraine. Then, of course, there is the snowball effect from the very strong focus on ethanol in the United States and, therefore, a certain influence on the increase of prices in corn.
The Commission has, as mentioned already, reacted: set-aside is put to zero for the coming production year, for the sowing to take place this autumn and next spring. Then whether to continue a zero set-aside will be a discussion to be held during the health check. We expect that the zero set-aside could contribute to somewhere between 10 and 12-15 million tonnes, depending on the climatic conditions. Moreover, I will submit to the College of Commissioners a proposal to the Council to suspend cereal import duties only for the current market year. I think that those initiatives will help us to ease the pressure on the livestock farming and the consumer prices.
There are different problems for the pigmeat sector. The pipelines are filled with meat, so there is an imbalance on the input and output in the sector and therefore the management committee decided last Thursday to introduce a private storage that I hope will help the problems in the pigmeat sector. There are other possibilities, but I think we should try to find the right balance because, if it is only a question of prolonging the pain, then we gain absolutely nothing.
So, I think that we have reacted and I have had the possibility to thank Parliament for its quick reaction so that we could send clear signals as soon as possible to the farming sector on the zero set-aside. I would like to come back to the GMO question in my final remarks, as I can see that my time has expired.
Mairead McGuinness
on behalf of the PPE-DE Group. - Mr President, I would have been happy to share my time with the Commissioner, because I am interested to hear her views on GMOs, but I will be here for the entire debate.
I think it is true, because it is not the first time we have said it in this Chamber, that the unpalatable truth is that the era of relatively cheap food is over and that what has happened was not predicted either within the Commission or, indeed, globally.
The Commissioner has gone through some of the reasons why we now have this imbalance in supply and demand and I agree with her: weather, climate change, the demand from the developing countries and, yes, biofuels are impacting globally - the Commissioner has acknowledged that. However, it is important to remember - and there were others in this House prior to my time - what your predecessor Mr Fischler said when reforming the CAP in 2003. He promised farmers better market prices. Perhaps we are seeing the impact of those reforms now, and we are beginning to question those impacts because of the impact on consumer prices.
We have had positive developments on milk and cereals, but we do not have the same on the livestock sector in terms of the beef and lamb producers, chicken and pigmeat that the Commissioner has discussed.
We are asking the questions now about the volatility and whether we are happy with that volatility in demand and supply. A major food company said to me recently that the supermarket buyers have no knowledge or interest in the economics of food production, but they are beginning to take note, and that is positive. However, we need to monitor the power of the supermarkets and to look at whether they are passing on the price increases they are charging to the producers of food. That is something I would urge the Commission - perhaps the Commissioner for Competition - to take a close look at. They have refused to do it in the past.
Concerning GMOs, this is a big issue. There is a problem in relation to the differences of approval methods between the European Union and the US and we need to look at that. So I wait for the Commissioner's comments on GMOs before making my points in particular.
Lastly, we cannot ignore the impact on the developing world of insecurity, particularly with the grain market, where countries that cannot afford to pay more for food are seeing a massive increase in their food bill. We must acknowledge it in this House and we need to take it into account in our policies going forward.
Bernadette Bourzai
on behalf of the PSE Group. - (FR) Mr President, Commissioner, ladies and gentlemen, during World Food Day on Tuesday 16 October, the FAO wanted to raise public awareness of malnutrition, which currently affects 854 million people throughout the world. On this occasion, the rising price of agricultural raw materials was highlighted, particularly its impact on consumers in the developing countries - my fellow Members have spoken about this at length - but also on the populations of poor countries, which import cereals. While in the developed countries, we spend 10 to 20% of our household budget on food, in the least developed countries, this figure is 60 to 80% of the budget, and a 20% increase in the price of cereals is drastic. This situation is made worse by the fact that some countries depend heavily on imports, and are affected by currency fluctuations, climate variations and increases in transport costs.
Commissioner, you have responded partially, but I hope there will be other measures. What measures do you intend to take in the short and medium term, for the CAP health check, to put right this difficult situation for consumers in the North, and this even more difficult situation for those in the South, and to contribute to a global food equilibrium?
Niels Busk
on behalf of the ALDE Group. - (DA) Mr President, Commissioner, it is important that there is now a focus on the very interesting situation that we are currently witnessing in connection with the very marked price increases for a number of agricultural raw materials. At the same time, we know that in the areas where they have not yet taken effect, namely the pig sector, these price increases will lead to a very expensive winter in terms of food prices. We are aware of the underlying causes: poor autumn yields, empty corn stores, etc. - I will not go into any more detail about this.
I feel that the situation we are currently experiencing should provide an opportunity for more discussion. First and foremost, we should not be alarmed at the current price rises. For far too long a litre of milk has cost less than a litre of cola and less than a litre of water. It is completely unreasonable of us not to accept that food should cost what it actually ought to cost, because there is a long production time and many working hours behind the products, particularly in the milk sector. It is also clear that there is now an opportunity to increase the production of foodstuffs in Europe. The market is in fact demanding this of us. The Commission has shown good initiative by removing set-aside and of course we still have the opportunity to increase production very quickly, especially in the milk sector.
We should continue the reform of the common agricultural policy from 2003 by reducing support, and we should seriously discuss further transfers of agricultural support to rural development policy. We now have the opportunity to kick-start dynamic agricultural production in the EU, and this means that we can give farmers more freedom than they have at present to exploit the current strong demand. Naturally, as is the tradition, we will also take care of farmers in mountainous areas and less fertile regions - that is all that is needed! However, we must not be afraid of price rises, but instead understand and make offensive use of the situation in which we find ourselves.
Janusz Wojciechowski
on behalf of the UEN Group. - (PL) Mr President, in the European Union we have recently seen a significant rise in the price of basic foodstuffs, particularly in the new Member States. In Poland, for example, the price of bread has risen by 15% over the last two years, the price of apples by 83% and the price of potatoes by 33%, while the price of milk has almost doubled. There is a similar trend in some of the old Member States: in Italy and in Ireland. Of the new Member States, Lithuania too has seen the price of cereals, milk, fruit and vegetables almost double.
On the other hand, EU policy is based on limiting the amount of agricultural production, and this policy is beginning to appear increasingly at odds with the needs of consumers. All the so-called reforms of the common agricultural policy are based on limiting production within the European Union.
Reform of the market in sugar is a massive limitation of sugar production in the European Union, from 18 million tonnes to 12 million tonnes. Reform of the market in wine again involves limiting production.
Other reforms also aim at producing less in the European Union. On the other hand, we have a very important signal. Consumers are demanding more food in Europe, and this is such a major signal that the entire aim of the common agricultural policy needs to be verified. We must ask ourselves whether the method of limiting production and setting production quotas is in fact good, above all from the point of view of the interests of consumers, as this is chiefly about them.
This is about Europe supplying as much food as its people require. There are many signals pointing to a need to review the agricultural policy we have been conducting. Many thanks.
Friedrich-Wilhelm Graefe zu Baringdorf
on behalf of the Verts/ALE Group. - (DE) Mr President, Commissioner, this discussion has gone crazy. We have been talking about falling prices, lowest possible prices and all-time lows for years. All the speakers who are now bemoaning the fact that prices are rising - finally heading upwards for once - and are calling for measures to hold back the price rises.
We should be happy that the market is functioning, with your help. With the help of your predecessors, but also of demands made by the European Parliament, the billions of euros that were going into intervention and price stabilisation - the price pressure that ruined market prices on the world market and have caused the countries of the third world to get into difficulty - have been done away with. Finally this circumstance has been eliminated and we are getting closer to the market, entering a situation that is being exacerbated by the use of corn to produce fuels.
There are many other reasons why such great demand exists on the market at present. The market reacts, the price goes up and now we, here in the European Parliament, as representatives of the farmers, are asking for prices to be brought down again. I have never been involved in anything so ridiculous in all my 20 to 25 years in Parliament! That is why I applauded Mr Busk. We should be delighted with this situation. Of course we have to be watchful on behalf of those who cannot afford to buy food at normal prices.
We have to hold unjust wage rates and misguided social policies in any country accountable, but we cannot take measures to put food in the mouths of the poor at the expense of farmers who, in recent years, have left farming in their hundreds of thousands. This is not the right way to be talking!
I am glad that we can even discuss the situation here today and that we have a market in which prices are finally increasing.
Vincenzo Aita
Mr President, ladies and gentlemen, I think it is important to initiate this discussion, although, partly because of what the Commissioner has told us, we are not seeing the full scale of the problem yet.
I would like to remind the Commissioner that a few months ago, we asked for a moratorium on the discussion of amendments to the CMO in fruit and vegetables in order to pause and reflect on what was happening - and what is happening now in wine - based on a few points, which I would now like to raise.
Firstly: we are talking about harvests that have failed due to climatic events, but there is no mention of the fact that we will be dealing with this problem for years, because climate change is happening in Europe and around the world. Fact one!
Secondly: compared to 1950, when there were 2.5 billion of us and everyone on the planet had 0.5 hectares each, by 2020 the world's population will have grown to 7.5 billion (according to UN data) with around 0.2 hectares per inhabitant available for cultivation.
I understand where Mr Baringdorf is coming from when he says that this is a fundamental problem, but I do not think that the increases we are seeing at this time are to the advantage of producers. If we look at the difference between the cost of the product and what consumers are charged, we can see that consumers and producers are paying for a very long supply chain. However, this is partly due to policies created here in the European Parliament, so I think the Commissioner should look carefully at the actions we are going to be setting out.
Of course, it has been important to return fallow land to production, although today what we need most of all is in-depth discussion. When the European Community was created, action was taken to meet the food requirements of the European people. Today, we should adopt the same policy. We can no longer allow land to be set aside under a decoupling policy, because this leads to a loss of production and renders our questions unproductive. Therefore, we must prepare for an in-depth discussion on whether the policies of the past few years have delivered a response to consumers and producers, or whether conversely they have created problems for both.
Jim Allister
Mr President, I want to focus on the position in the intensive sector. I will not take time to recount the dire straits in which many producers in that sector find themselves, rather I want to focus on what I believe the Commissioner should be doing to help. I have four or five points to make.
First of all, I think the Commissioner should recognise that soft measures, like market promotion, are not going to be enough. Secondly, she should face up, more than has happened to date, to the long-term impact on grain availability and prices of the rampant switch in the United States to biofuel production. Their targets, which are very aggressive, are in truth drying up the imports that we need in that regard.
Thirdly, with intervention grain stocks at an alarming low and the ratio with usage being totally out of kilter, there urgently needs to be action to address that balance. Fourthly, I suggest that the Commissioner needs to be more proactive in fighting for speedier approval of GM substitutes. With respect, Commissioner, you need, on behalf of agriculture, to match the vigour of Commissioners Kyprianou and Dimas as they resist GM approvals.
Fifthly and finally, you need to put a floor in the market for our intensive sector, with export refunds extended immediately to meat and hams. On that point I am not sure that helping private storage will solve very much in the longer term.
Struan Stevenson
Mr President, let me be first of all assure Mr Graefe zu Baringdorf that I am happy to see prices going up for our farmers at last, so long as it is farmers who benefit, and not supermarket chains. Up until now the small number of supermarket chains that dominate the retail sector in Europe have been profiteering at the expense of our farmers and producers.
In my constituency in Scotland, dairy producers have for far too long been getting GBP 0.17 per litre for milk, which is below the cost of production, while it was selling on supermarket shelves at over GBP 0.50 per litre. That has driven many dairy farmers in my constituency out of business altogether.
We have now seen the price farmers receive for wheat go up by only 10 %, while the shelf price in supermarkets of wheat-based products has gone up by 40 %. Once again, supermarkets are using fluctuations in price to pocket bigger profits for themselves.
That is a disgrace, and I agree entirely with Mr Parish that we should ask the Commission to start an investigation into the pricing policy of supermarket chains in order to ensure that consumers and producers get a fair deal.
María Isabel Salinas García
(ES) Mr President, it is clear that the rise in prices that consumers are experiencing directly in their shopping baskets is due to multiple factors, but in my speech I am only going to discuss what Mr Stevenson said.
I think that the role of intermediaries and large food retail chains is concerning. In many cases they respond to speculative movements, so the increases in the prices of final products are greater, as has been said, in percentage terms, than the increases in the prices of raw materials.
The situation is also very concerning for producers who, in the face of the huge purchasing power of the large retail sector, are obliged to reduce their selling prices, without being able to pass on the increases in raw material or fuel prices.
I therefore think, and I support the previous speaker, that it is important for the Commission - and I would like to take this opportunity to thank the Commissioner for being here - to act and take measures: that there should be investigations and the necessary means put in place to bring an end to these practices, which are unfair, and in many cases abusive.
I think that the resolution is very timely, and that we are in time to be able to adopt measures.
Andrzej Tomasz Zapałowski
(PL) Mr President, many of those who have spoken before me have been pleased that there has been a rise in the price of foodstuffs, but we must ask ourselves whether this price is getting through to the farmer. I have very serious concerns about this. Many small farms are currently being closed down in line with the policy of the Commission and the European Union. We must, however, also ask ourselves what kind of foodstuffs farmers are receiving. They are getting beef from Brazil, sugar from South America, dodgy chickens from Asia, and thus cheap foods are pouring into our market, which is 'lowering' prices for us, but in fact restricting production in Europe. The question arises: are we going to have to keep on bowing down to the industrial lobby? Why, at the end of the day, can we not start supporting European farmers once again, at a time when a niche has appeared for us to increase this production and raise quotas for milk and starches, for example, for which there is a constant demand in Poland and other Eastern European countries.
Diamanto Manolakou
(EL) Mr President, the problem of bread, milk, potatoes and other foods undergoing a price hike, which in some Member States is ten times the current rate of inflation, is very acute, particularly for those on low incomes, the main proportion of whose budget goes on food.
This problem did not come out of the blue. We know that the food sector is controlled by a few undertakings which make significant profits at the expense of producers and consumers: consumer prices are many times higher than those paid to the producers because of the large number of middlemen and the market monopoly. For this reason there is now an increased global demand for food and animal feed; cereals and oil seed rape are being used in the production of biofuels, not for environmental reasons but as part of the profit-making plans of the oil multinationals.
There has been a collapse in prices and EU intervention to help cereal production has diminished, and there has also been a mandatory set-aside because of the CAP. All these factors, together, of course, with dreadful weather conditions, have drastically reduced the EU's stocks and production. Nonetheless, trade and industry have exploited this at the expense of farmers and consumers.
This is why food and animal feed prices have risen. These rises have worsened the position of workers, increased the number of undernourished people and bankrupted small and medium-sized livestock farmers. Greek livestock farmers are in despair; they are taking action to demand substantial aid to help them survive.
The decision by the Council of Ministers on 26 September to remove the compulsory set-aside, suspend duties on imported cereals and take other measures, to which you have referred, Commissioner, will go some way towards easing the problem, but it does not solve it. The decision suggests half-measures, which are by their very nature insufficient. Substantial measures are required to boost and the stock of animal feed, control prices, and clamp down on cartels and speculation.
Agnes Schierhuber
(DE) Mr President, Commissioner, ladies and gentlemen, I am very grateful that we can have this debate today with the Commissioner. As commodities prices increase, people are paying more attention to agriculture again. The situation is due, on the one hand - as already mentioned by the Commissioner and some of the previous speakers - to demand from third countries and on the other, to crop failures in traditional agricultural exporting countries such as Australia and New Zealand. Therefore it is essential that we mobilise all the resources that we have in Europe. I have now determined, for example during my visit to Romania, that at least a third of the total cultivatable land is lying idle, as it always has. We have considerable resources within our Member States. A first step would surely be to stop letting land lie fallow.
As already stated, as a farmer, I believe wholeheartedly that the first priority should be to produce healthy food, the second priority to produce fodder and the third priority to produce energy materials. Ultimately, however, I believe that the slight price increase for our farmers does not in any way bring the price adjustment that would make up for the losses of recent decades. As many of those who have already spoken have pointed out, we are getting perhaps 10% more in primary materials prices, but retailers are marking that up by 40-50% in some instances. I am thinking of butter, for example, and this does not seem fair to me.
One way for us farmers to respond would be to organise ourselves better into producer cooperatives with production contracts, in order to meet the food retailer monopolies head on.
Csaba Sándor Tabajdi
(HU) The present debate clearly demonstrates yet again how widely opinions vary in this House. I agree with Mr Stevenson, namely that this price rise means only a very small increase in income for farmers, compared with the trade sector, supermarket chains, and market speculators, who take the lion's share.
Another problem is that cereal producers will benefit hugely from this, while livestock producers will lose a great deal. We have an untenable situation here: certain sectors are either favoured or neglected under the common agricultural policy, and this price rise is set to make the neglected sectors even worse off, while those that are prosperous will get even richer.
I agree with Mr Graefe zu Baringdorf that the increase in prices is a good thing, but who is going to be affected by this price increase? These contradictions are continually increasing, and unfortunately the distortions of the common agricultural policy deepen and exacerbate these distortions. We need to fundamentally rethink common agricultural policy, because piecemeal interventions are merely cosmetic. There can be no normal common agricultural policy as long as livestock production, wine, vegetables and fruit, pig-meat and poultry are neglected sectors. Thank you.
Esther Herranz García
(ES) Mr President, as I said last month during the debate we had in Parliament on the suspension of compulsory set-aside, which was also a night sitting, the increase in agricultural prices should provoke an in-depth discussion on the direction that the common agricultural policy is taking.
We will soon have the Communication from the European Commission on the CAP 'health check' on the table, but I fear that in that communication the Community executive will not be bold enough to acknowledge that the liberalisation of the markets also has a price, and that European farmers and consumers are now starting to pay that price.
Many Members of this House have always favoured a dismantling of the market management measures and have contributed to projecting the negative image that European consumers have built up regarding the CAP.
As I said at the last plenary sitting, I would like to know how we are now going to explain to citizens that we scarcely have the instruments to control these rises in agricultural prices in the European Union.
It would also be interesting to ask the European Commission to estimate what the cost is going to be for European citizens of this increase in food prices and to compare this cost with the cost for each citizen of the common agricultural policy.
I would also really like to know whether or not citizens will ultimately benefit in the coming years from the liberalisation of the markets and the drastic cuts in direct aid that European farmers are suffering from.
I am going to give you a statistic which I think is very significant: before the creation of the CAP, in 1961, the prices of raw materials for producing animal feed were twice as high as the prices paid by farmers 20 years later. The common agricultural policy guaranteed a supply of raw materials at an affordable price and at the same time European consumers also benefited from a fair price for an essential commodity.
In a country such as mine, Spain, we are seeing rises in prices of foods as basic as milk. I think that the economics and finance ministers of the European governments should now also be more concerned about the repercussions that this increase will have on inflation in their countries.
Rosa Miguélez Ramos
(ES) Mr President, Commissioner, all of us who are here tonight are aware of all the causes of the rise in the prices of cereals and raw materials. Although you gave us some good reflections on what those causes are, there are, however, other issues that you tiptoed around.
As you are going to present your proposals on the CAP 'health check' to us in November, I would prefer to tell you now what I think, and say that I hope that in this 'health check' you will analyse whether the CAP is in line with the new requirements of the global market, because one of the principal causes of the restriction of European production has, I am convinced, been the lack of foresight by Community experts.
We need to review the current policy of extremely reduced stocks. The Community intervention stores should, as has been said here, be the safety net for guaranteeing supply at times like these, but there are no supplies and the Community stores are empty.
I am very concerned, Commissioner, about the consequences that the rise in animal feed prices is having on European livestock farming, as it is having a very negative effect, especially on small and medium-sized farms.
James Nicholson
Mr President, this is a very timely debate. We all know that cereal prices have increased dramatically, and we know the reasons why. Commissioner, it is a fact that we depend on, and still need, grain imports and substitutes from outside the European Union, mostly from the United States. In this respect, I am concerned that it is taking so long to decide on the new strains of grain that are up for approval. I am well aware that this is not necessarily the Commission's fault. It is the fault of the national governments, because they could not agree. You are going to have to take the decision, and I hope you take it as soon as possible.
I would urge speedier approval of the new strains of grain that are in the pipeline. As price inputs rise, the cost is inevitably passed on to the consumer. That is not something that anyone looks forward to, but it is where we must face up to the power of the supermarkets.
I have known Mr Graefe zu Baringdorf for nearly 19 years now - ever since I have been in this Parliament. I have to say that sometimes he gets it right and sometimes he gets it wrong; he is wrong on this occasion. I am not against prices going up, as long as the price comes through to the producer as well as to the processor and the consumer.
We must address not only this issue, but also the use of GM grain. We are importing into the European Union food for our consumers to purchase in our stores when we have no idea how it was produced. There is no traceability of these imports. They could have been produced using any manner of means. That is something that we must confront. A large amount of the meat coming from Brazil, to name but one country we have discussed, is almost certainly produced using GM-grain. How can we tell the difference?
Catherine Neris
- (FR) Mr President, Commissioner, ladies and gentlemen, I would like to congratulate the authors of this resolution and give them my support.
The soaring price of cereals and therefore of foodstuffs generally reflects Europe's current dependence on the volatility of world agricultural markets. Accepting this situation would mean accepting that consumers are becoming a variable for adjustment during the correction phases of these markets. Accepting this situation also means denying the influence of the large supermarkets, which for 40 years have contributed to the downward trend in prices for farmers, while food prices for consumers have stayed the same or have increased.
This excessive margin capture could have, and should have, been used by the large supermarkets to absorb the rising cost of agricultural raw materials in the crisis we are currently experiencing. Clearly this is not happening. The large supermarkets are continuing to abuse their dominant position and the Commission must now discuss this question as a matter of urgency so as to prevent European consumers from being held hostage to an unfair and dangerous system.
Mariann Fischer Boel
Member of the Commission. - Mr President, I will try to respond to some of the questions raised.
First of all, I agree with those who say that it is nice and very satisfactory to see that the market is now working, that the reforms we have been making are working. That was the whole idea behind all the work done to reform our agricultural sector, so now the farmers can actually respond to the market, and that - from the farmer point of view - is what we really want to do.
It is also important to realise that this increase in prices is not a European phenomenon, it is a global phenomenon - and that is the reason why it is very difficult for us to take certain measures.
I would just like to respond to the idea of introducing export refunds. I think it could send the wrong signal to the sector to continue production and thereby prolong the pain to the point where we see an increase in prices - here I am talking specifically about the pigmeat sector. But there will be pressure on prices as long as we have overproduction compared to demand. We see that prices are going down on carcases; we know that it is part of the cycle and we know as well that in autumn there is always pressure on pigmeat prices.
Let me just mention biofuels, which, under the mandatory targets that the Commission presented on 10 January 2007, will represent 10% of our fuel transport sector by 2020. We never intended that this would be exclusively European production: we will need imports. However, it is very important that we start on the first generation and thereby encourage our research institutions to try to find the golden solution for the second generation that will not be produced exclusively or mainly on cereals but on straw, woodchips and residues from slaughterhouses. We therefore have potential, and we estimate that, by 2020, between 20% and 30% will be coming from the second generation, and we might be able to do better if we push the research investments.
Concerning GMOs, I can fully assure you that the Commission is aware of the problem posed by asynchronous authorisation. You can see the consequences in the Directorate General for Agriculture's recently published report - which you can find on the internet - where there are three different scenarios. The Commission is currently reflecting on the best way to address this situation without any compromise on our high level of risk assessment, with regard to both the environment and human health.
Important improvements have already been made in reducing the procedure or the time line - the time necessary - for authorising GMOs. I would like to mention, just as an example, the recent commitment by the European Food Safety Authority to perform the completeness check within six weeks, compared with a much longer period previously. I also expect that stronger support from the Member States will help the Commission in further shortening the time line of the authorising process. Steps in this direction have been taken to increase Member States' support in the authorising process.
I am strongly committed to workable implementation of our rules to ensure that trade in animal feed is not disrupted, with clearly negative consequences for our farmers. But I am also committed to ensuring the highest level of safety when it comes to placing new GM products on the market, and of course our trading partners know the specific rules that we have within the European Union.
Just two days ago I came back from Argentina and Brazil. They told me clearly that they will be able to deliver non-GM products, soybean and maize mainly, and the types of GM products that have been authorised in Europe. But they said that we have to be aware that this is more costly. If we are prepared to pay the price they will deliver but we have to remember that they have other customers out there, and here they mentioned China as a big customer.
So I am quite sure that we will come back to this issue. I feel certain that we will before too long.
President
I have received six draft resolutions submitted under Rule 108(5).
The debate is closed.
The vote will take place on Thursday 25 October 2007.
