The Impact of an EU–US Transatlantic Trade and Investment Partnership Agreement on Biofuel and Feedstock Markets

We assess the impact of a potential TTIP bilateral free trade agreement on the EU and US bio‐economies (feedstock, biofuels, by‐products, and related competing crops) and major trade partners in these markets. The analysis develops a multi‐market model that incorporates bilateral trade flows (US to EU, EU to US, and similarly with third countries) and is calibrated to the OECD‐FAO baseline for 2013–2022 to account for recent policy decisions. The major policy reforms from a TTIP involve tariff and TRQ liberalisation and their direct contractionary impact on US sugar supply, EU biofuel production, and indirect negative effect on US high fructose corn syrup (HFCS) production. EU sugar and isoglucose production expand along with US ethanol and biodiesel and oilseed crushing. EU sugar would flow to the US, US biofuels and vegetable oil to the EU. We further quantify non‐tariff measures (NTM) affecting these trade flows between the EU and the US. EU oilseed production contracts, and EU crushing expands with improving crushing margins following reduced NTM frictions. Our analysis reveals limited net welfare gains with most net benefits reaped by Brazil and not the two trading partners of the TTIP.     

EU Reform of the Sugar Beet Regime: Implications for UK Agriculture

The purpose of this article is to discuss possible scenarios for UK sugar beet production after the reform of the sugar regime. The analysis is built on an evaluation undertaken by the University of Cambridge and The Royal Agricultural College of the impact that reforming the EU sugar regime may have on UK agriculture. The analysis focuses on the implications of reductions in quota and the support price and on the possible reactions by British Sugar, as the final outcome in terms of production will depend on the interaction between British Sugar and sugar beet farmers. The analysis indicates that British Sugar strategies such as reallocating the available quota to the more efficient producers or paying higher beet prices might mitigate the impacts of the reform. The key factor in limiting the overall impact on production is the extent that the industry can restructure and reduce its cost base. For example, following a 40 per cent reduction in the sugar beet price we estimate that if farmers could reduce their average costs by 20 per cent, about 52 per cent of UK beet production would still be viable, compared to less than 20 per cent if costs were not altered.     

Reallocating sugar beet contracts: can sugar production survive in Denmark?

The reform of the EU sugar regime involves significant pricereductions for sugar and sugar beet. We examine whether theDanish sugar industry can maintain production and profit levelsby reallocating production from less to more efficient farmers.The impact of alternative reallocation mechanisms is estimatedusing a DEA model of sugar beet production, together with informationabout processing capacity at the three Danish plants, beet transportationcosts and alternative crop options. The analysis shows thatthe present allocation is far from efficient. With the new reformfully implemented and the quota efficiently reallocated, actualproduction will fall by only 25 per cent, although profit willbe substantially lower.     

Developments in the Doha Round and WTO dispute settlement: some implications for EU agricultural policy

Progress in the Doha Round is assessed against the changes tothe common agricultural policy (CAP) brought about by the Fischlerreforms of 2003–2004, and that proposed for sugar. Anelimination of export subsidies could place EU exports of processedfoods at a competitive disadvantage because of high sugar andmilk prices. Provided the single payment scheme falls withinthe green box, the likely new limits on domestic support shouldnot be problematic for the post-Fischler CAP. However, an ambitiousmarket access package could open up EU markets and bring pressurefor further reform. If there is no Doha agreement, existingprovisions will continue to apply, but without the protectionof the Peace Clause; and increased litigation is likely. FurtherCAP reform is to be expected.     

Farm-based modelling of the EU sugar reform: impact on Belgian sugar beet suppliers

A mathematical programming model, calibrated on individual farmdata, is used to analyse the reform of the common market organisation(CMO) in the sugar sector of the European Union. The model includesa precautionary farm supply function for out-of-quota sugarbeet that is estimated as part of a simultaneous system of first-orderconditions. Simulation results from a sample of Belgian sugarbeet farms show that the sugar CMO reform induces differentsupply and income effects across farms depending on their shareof out-of-quota sugar beet relative to their total beet supplyand their quota rent. A further cut in the minimum price ofsugar beet initiates structural change in the farm sector.     

The Impact of the 2013 CAP Reform on the Decoupled Payments’ Capitalisation into Land Values

We assess the effects of the 2013 CAP reform on the capitalisation of decoupled payments in land rental values. Our estimates suggest that the reform leads to an increase in the capitalisation of decoupled payments by an additional 18 cents for each Euro of decoupled payments relative to the pre‐reform situation. However, there is an important variation in the reform effects between Member States (MS) particularly between Old Member States (OMS) and New MS (NMS). In NMS, the capitalisation rate slightly reduces from 83% in the pre‐reform period to 79% in the post‐reform period. Although, the rate is significantly lower in OMS, it doubles (from 21% to 43%) due to the reform. The main sources of the post‐reform capitalisation in the European Union (EU) are the pre‐reform capitalisation accounting for 69% of the total post‐reform capitalisation, followed by the entitlement stock change with 19%, by the internal convergence of payments with 18%, the budget change (including external convergence) with 1%, and the differentiation of payments (redistributive payment) with ?7%. Overall, our estimates suggest that on average in the EU, the non‐farming landowners’ policy gains are 27% of the total decoupled payments in the post‐reform period compared to 18% in the pre‐reform period.     

中国糖料生产布局变动及其影响因素分析

[目的]掌握糖料生产布局规律,引导并支持糖料生产向优势主产区转移,将能够在一定程度上提高中国糖料的市场竞争力。[方法]利用1980—2015年13个省(区)的面板数据,采用描述性统计和固定效应模型,文章重点对中国糖料生产布局变动、区域比较优势及其影响因素进行了分析。[结果]改革开放后中国糖料品种逐步向甘蔗集中;甘蔗生产逐渐向华南的广西和西南的云南集中;甜菜生产逐步向西北的新疆和内蒙古聚集。从区域比较优势看,现行中国糖料生产布局是符合生产规律的。此外,研究还发现比较效益、农户粮食安全供给水平、有效灌溉面积和农业机械化水平对中国甘蔗生产布局具有显著的正向影响;有效灌溉面积、受灾程度和临时收储政策对中国甜菜生产布局具有正向促进作用。[结论]建议从做好全国糖料生产区域规划、精准给予糖料生产支持政策及提高政策支持成效三方面下功夫。     

Agenda 2000 Reform of the CAP and its Impacts on Member Member States: A Note

We evaluate the Agenda 2000 reform of the CAP for each of the 15 member states of the EU, accounting for general equilibrium effects and bilateral trade links. Results reflect the impacts in 2008 projected from a 1997 database. In most member states, output of crops falls and there is a switch in the use of arable land from oilseeds to cereals. Output of cattle also falls, but that of milk, pigs and poultry increases. Total farm income falls in 11 member states, although livestock producers throughout the EU gain. Consumer price indices fall everywhere. In terms of GDP, Luxembourg, Finland, Ireland and Portugal gain the most; Germany, Greece and the UK gain the least; and Spain loses. The net budgetary cost to the EU of the reform package is estimated to be an additional €3,203 million. Thus, further cuts in support are of paramount importance if the EU is to be prepared for the accession of new members.     

Impacts of Decoupled Agricultural Support on Farm Structure,Biodiversity and Landscape Mosaic: Some EU Results

The decoupling of direct payments from production represents a substantial reform of the Common Agricultural Policy (CAP). Farmers are no longer required to produce commodities to be entitled to support but only to keep land in Good Environmental and Agricultural Condition. If output declines as a result, there is concern that landscape services produced jointly with commodities will also decline. The aim of this paper is to assess the long‐term effects of the 2003 reform on farm structure, landscape mosaic and biodiversity for a sample of EU regions. Impacts are quantified using a spatial agent‐based modelling approach by simulating agricultural development with links to indicators of landscape value. Our results demonstrate that eliminating the link between support payments and production has possible negative consequences for the landscape, but only under particular circumstances. It is shown that these effects could be offset by strengthening (Pillar II) agri‐environmental schemes. Further the single payment scheme results in higher land rental prices which reduces its ability to achieve its goal of providing income security for farmers. Implications of these results for the direction of continued CAP reform are discussed.     

Structural Change and Long‐run Relationships between US and EU Wheat Export Prices

This paper analyses the nature of the long‐run relationship between US and EU wheat export prices over the period 1981–2000. We employ a novel approach of testing for cointegration with structural change developed by Barassi and Taylor (A Test for Change in the Cointegrating Rank, University of Birmingham, Birmingham, 2004). The method enables us to determine the breakpoint, which is found to occur after the 1992 CAP reforms were implemented. On analysing the two separate subperiods, we find no evidence of a long‐run relationship prior to the 1992 CAP reform. However, clear evidence of a long‐run relationship is found after the CAP reforms were implemented. Further analysis reveals that, in the post‐CAP reform period, the EU wheat prices follow then US soft wheat prices, consistent with the EU export subsidy regime over this period, albeit that export subsidies by the EU have been relatively small.     

CAP Subsidies and Productivity of the EU Farms

The paper investigates the impact of the Common Agricultural Policy (CAP) subsidies on farm total factor productivity (TFP) in the European Union (EU). We employ a structural semi‐parametric estimation algorithm directly incorporating the effect of subsidies into a model of unobserved productivity. We empirically study the effects using the Farm Accountancy Data Network (FADN) samples for the EU‐15 countries. Our main findings are clear: subsidies impact negatively on farm productivity in the period before the decoupling reform was implemented; after decoupling the effect of subsidies on productivity is more nuanced and in several countries it turned positive.     

Collective Marketing Arrangements for Geographically Differentiated Agricultural Products: Welfare Impacts and Policy Implications

We examine the incentives of atomistic producers to differentiate and collectively market products. We analyze market and welfare effects of alternative producer organizations, discuss circumstances under which they will evolve, and describe implications for the ongoing debate between the EU and the United States. As fixed costs of development and marketing increase and the anticipated market size falls, it becomes essential to increase the producer organization's ability to control supply to cover the fixed costs associated with the introduction of differentiated products. Counterintuitively, stronger property right protection for producer organizations may enhance welfare even after a differentiated product has been developed.     

农村公共产品供给机制变迁的历史困境及其突破

农村公共产品供给机制创新是深化农村改革和新农村建设的重要内容。城乡非均衡发展战略、农作制度改革的"单项突进"以及供需主体的双重缺失,导致了农村公共产品供给的历史困境,并日益成为困扰和阻碍农业和农村发展的瓶颈。本文在考察建国以来农村公共产品供给制度变迁轨迹的基础上,试图探寻新时期解决农村公共产品供需失调的制度安排,无疑具有重要的现实意义。     

Domestic Support and Border Measures for Processed Horticultural Products

In horticultural markets, trade barriers often apply to the processed products whereas domestic support applies to farm-produced raw commodities. Here we assess the effects of such trade barriers and domestic support by simulating the effects of policy reform on global processing tomato markets, which are faced with modest processed product tariffs and high domestic support in the European Union (EU). Both protection and EU subsidy drive down world welfare, but we find that reducing import tariffs for tomato products would yield greater effects on markets and larger welfare impacts outside Europe than would reductions in EU domestic support.     

Green Light for Green Agricultural Policies? An Analysis at Regional and Global Scales

This paper analyses the effects of introducing biodiversity‐targeted ecological focus area (EFA) requirements on all farms with arable land in the EU by quantifying their global, regional, economic and environmental impacts in a mutually consistent way. To capture these impacts, different spatial scales need to be considered – ranging from on‐farm decisions regarding the EFA in the EU, to supply response around the world. In order to address this challenge, we combine the supply side of the CAPRI model, which offers high spatial, farm and policy resolution in the EU, with the GTAP model of global trade and land use. Both models are linked through a multi‐product, restricted‐revenue function for the EU crop sector. The results predict improved environmental status in the high‐yielding regions of the EU. However, output price increases lead to intensification in the more marginal areas of the EU where little or no additional land is taken out of production. The decrease in arable land in the EU is partially compensated by an increase of crop land, as well as increased fertiliser applications, in other regions of the globe. Thus, the improvement of environmental status in the EU comes at the price of global intensification, as well as the loss of forest and grassland areas outside the EU. Overall, we find that every hectare of land that is taken out of production in the EU increases greenhouse gas emissions in the rest of the world by 20.8 tonnes CO₂ equivalent.     

The EU Budget and the CAP: An Agenda for the Review?

The promised review of the EU Budget in 2008 offers an opportunity to bring CAP financing into line with logic, justice and the rest of EU policy. Currently, the CAP is unique amongst European policies in being both mandatory and requiring 100 per cent financing by the EU budget. While this made good sense at the policy's inception, it is now an obsolete anachronism. A sensible and defensible agenda for financial reform, which is all that is on the reform agenda at present, is to make the EU budget responsible for only a fraction (say 25 per cent) of the costs of the current CAP, instead of the present 100 per cent. This would bring CAP financing into line with other EU policies, and make member states separately responsible for the balance for their own farmers, as they so wish, up to the CAP budgetary ceiling already agreed. Any resulting competition between member states in the extent and means by which they continue (or not) to support farmers through direct payments would be controlled through EU Competition and single market policies. Such competition would also provide a good opportunity for experiments with policy development, to the advantage of all, since different policies are required for the different stages of development and different local conditions now evident within the EU.     

Impacts of WTO restrictions on subsidized EU sugar exports

The study evaluates the impact of World Trade Organization (WTO) restrictions on the European Union (EU) sugar sector and the world sugar market. A small reduction in production quotas would be sufficient to satisfy the export subsidy limitations of the Uruguay Round agreement. Complete elimination of export subsidies by 2005 would require either a 10% reduction in production quotas or the combination of an 8% reduction in quotas and an 11% reduction in intervention prices. Higher world prices resulting from reduced EU exports would result in increased production of unsubsidized C‐sugar, with different impacts across EU member countries explained by differences in institutional pricing arrangements and marginal production costs.     

Alternative U.S. and EU Sugar Trade Liberalization Policies and Their Implications

This study analyzes the impacts of alternative trade liberalization policies in the United States and the European Union (EU) on the U.S. sugar industry. A global sugar policy simulation model was used for this analysis. The study results indicate that the U.S. sugar industry may be able to survive if both the United States and the EU liberalize their sugar trade. However, if only the United States eliminates its sugar programs, all U.S. sugar-producing regions would be threatened.     

Mapping hotspots and bundles of forest ecosystem services across the European Union

Forests cover about 40 % of the European Union (EU), providing a wide spectrum of invaluable ecosystem services to more than half a billion people. In order to protect and harness this crucial asset, EU policies are advancing multifunctional management. This study lays a basis for such an effort by mapping the supply of key forest ecosystem services (FES) across the entire EU: wood, water supply, erosion control, pollination, habitat protection, soil formation, climate regulation and recreation. To further support the operationalization of multifunctionality and targeting of policies, our analysis delineates hotspots, assesses synergies and tradeoffs, and identifies spatial bundles.We generated maps at 1-km resolution starting from existing datasets through simple modelling (Tier 1). Out of these maps, we denoted the highest supplying pixels (i.e. top 20 %) as hotspots, and performed correlation analysis to detect synergies and tradeoffs. Finally, we used cluster analysis to identify FES bundles. Our analysis shows that hotspots of single FES are spread across the entire EU and that forests of mountain regions and Central Europe (particularly France, Germany, Slovakia) supply significant amounts of multiple FES. The cluster analysis resulted in four bundles: “balanced” in the northeast, “wood & water” in the center, “soil carbon” in the north and “rural-recreational” in the south. While a purely quantitative analysis of the produced maps may be misleading because of the strong links between FES supply and climatic and socio-economic conditions, overlaying hotspots and bundles with administrative layers can be a first step to inform about the role of different countries and regions in securing the sustainable supply of European FES.