Reform of the 2003 Common Agricultural Policy : the consequences for agriculture in Provence

In 2003, the PAC reform set up a new system for allocating subsidies provided to farmers. The measures adopted are based on the respect of environmental regulations, the payment of a direct subsidy based on the area of land not in production, as well as the reinforcement of subsidies for rural development.

Implementation of this reform, beginning in 2005, raised a number of questions on the possible direction agriculture would take and the future of the farming profession: changes in cropping, the amount of uncultivated land, consequences on landscapes, and the market supply in grains, oil-producing crops, and protein crops.

– Freeze-frame on Provence…

It is within this context in 2006 and 2007 that Cemagref scientists conducted a study designed to identify the strategies adopted by large-scale farmers in the Provence-Alpes-Côte d’Azur (PACA) region. This study, financed by the PACA Regional Council, was based on surveys taken among large-scale farmers in three contrasted agricultural zones: a dry agricultural zone and an irrigated agricultural zone situated in the Alpes de Haute-Provence department, and a periurban agricultural zone near the city of Aix-en-Provence, in the Bouches-du-Rhône department. Interviews were conducted on a representative sample of farmers, roughly 30 per zone. In addition to describing the existing farm systems, the questionnaires aimed to clarify the strategies farmers were implementing in five domains: the choice of crops, crop management strategies, land management strategies, the diversification of activities, and the development of practices and products.

– The effects of the CAP need to be put into perspective

One direct effect of this reform concerns cropping, although these choices have a more nuanced effect on farmers’ other strategies. Thus, in 2006, the acreage devoted to durum wheat clearly decreased in the three zones, with other diversification crops (hybrid lavender, feed crops, seed crops, barley, sunflower, and rape seed, for example). In 2007, however, the CAP effect was counterbalanced by the sharp increase in grain prices that curbed the decrease in land area planted in durum wheat by renewing the interest in this crop. Assisting farmers in becoming reactive to market signals was indeed one of the objectives of the 2003 reform. The study shows that nonproduction remains a very marginal land use practice.

The effects of the CAP need to be put into perspective in relation to all the internal and external factors affecting the farm. These include the socioeconomic context (tension on the world grain market, price of irrigation water, etc.), the climate in Provence marked by repeated droughts since 2003, the characteristics of production tools (soils, available labor, etc.), as well as the factors directly related to the farming family (technical skills, preferences, and personal projects). Given today’s high grain prices, the CAP reform does not fundamentally change the shape of agriculture in Provence. However, the CAP is not rigid: changes are being negotiated to respond to the mutations in the world context.

[The CAP, a few landmarks
In 1957, the Common Agricultural Policy was born. In addition to increasing agricultural productivity in Europe, it was designed to ensure an equitable standard of living for farmers and reasonable prices for consumers. Until 1992, agricultural prices were guaranteed to producers. In 1992, European prices were aligned on world prices. To compensate the decrease in farming incomes, subsidies were allocated in relation to the crops produced. In 2003, to bring the producer closer to the international market, a system of subsidies based on the area of land cultivated, independent of production, was initiated: the Single Farm Payment (SFP). Since the payment of subsidies is dissociated from the production act and crop volume, it is up to the farmer to define the most advantageous farming strategy.]
For more information:
The complete report, “Study of agricultural dynamics resulting from the potential impacts of the CAP reform on large-scale farms in the PACA region,” is online on the Cemagref website: http://www.cemagref.fr/Informations/Presse/index.htm