Policies and Regulations

Policies and regulations are important for every economic sector as they determine the production conditions. They are also part of the innovation ecosystem.

In the case of grasslands, and because of the complexity of the associated supply chains, many regulations and policies must be considered. We will focus on three of them: the common agricultural policy, and especially the agri-environmental measures, the dairy policy and eventually the regulations related to the seed sector.

Common Agricultural Policy

Agri-environmental measures

Dairy Policy: Situation in 2015

Milk is a particular product for two reasons¹:

  • it is consumed in two different forms: either fresh (very short conservation time) or transformed into butter or powder, for example (longer conservation)
  • more than 90% of produced milk is intended for human consumption.

The fact that milk is mainly consumed by human populations implies a very a very rigid product demand on the market, rising only very little from one year to the next. This automatically leads to the development of regulation policies. Why? If milk is only intended for human consumption, this means that in the case of surplus production, the surplus cannot be distributed for animal feed, which leads to irremediable loss of such surpluses. In the long term, there are significant economic losses, affecting the producers in particular.
Several regulatory measures have been implemented, the first of them shortly after the end of World War II.

Intervention Policies On Demand: 1960s and 1970s

The first measures taken at the European level aimed to support milk prices on the market. In the event of too high a supply compared to demand (which would ultimately lead to a drop in the price of milk), Europe invested public money to buy milk, and thus increased the demand (and prevented prices from collapsing). Milk purchased in this manner was transformed into butter and powder, stored and sold to countries like the Soviet Union when the opportunity arose. A development of the use of milk powder for babies as a substituent for breast milk coincides with this period.
However, these measurements lasted only some time, Europe could not continue purchasing when established inventories were already too great. This situation led to a surplus of butter (1970s) and milk powder (early 1980s).
At the same time, and up to the entry of Great Britain and Ireland into the European Union in 1973, there was an increasing gap between producers on the European scale. Anglo-Saxon countries paid more for fresh milk than for industrialised milk, leading to inequalities of income for producers depending on their country of establishment.

Milk Quota Policies: 1984-2015

Since the intervention upon demand was unsuccessful, the European Commission decided to restrict the supply, by imposing quotas in 1984. In the long term, the objective of this policy was to reduce the number of dairy farms by increasing their production, a smaller number of farms being economically easier to support.
Greeted with scepticism by owners because of its apparent social fragility, the policy of quotas fulfilled expectations over the years. By helping farmers to retire and younger farmers to take over (who were better able to invest and increase production), this policy satisfied all the actors within dairy production.
Attributions of quotas however vary between countries, the French system imposed quotas on local authorities, which are than imposing quotas on local farms. Some countries lacking dairy products would have liked to significantly increase their production but were thereby prevented by this policy.
However, in the interests of economic liberalisation, one of the founding principles of the European Union, the quota policy will expire at the end of March 2015. The European Commission considers that the dairy system in Europe has had enough time (thirty years in 2015) to be restructured, and that currently established farms should be able to adjust to the market.

Simultaneously with this economic evolution of the dairy market, new measurements were implemented to no longer support the product (considered to be more favourable to the farms with large production capacity), but income. The latter, based on criteria such as number of heads, historical production, or farm area, has ultimately changed very few things, but is nevertheless located in the European agricultural landscape.
These income aides are developing alongside a contractualisation of European policy, that is to say on development of direct contracts between producers and processors. The south-west has very low local production forcing the region to import from Spain, while Brittany for example, produces enormously.
Differences of opinion also exist between producers and processors: the first would prefer a relatively low overall production, meaning a higher prices, while the latter would conversely, prefer a large production and low prices.

The Rules for Registration of Varieties

To be able to market a variety, its inclusion in a national or European catalogue is required.

The inclusion of varieties is wholly governed by a certain number of European directives. It is an obligation within national frameworks leading to the inclusion in a national catalogue, which leads to inclusion in the European catalogue. Only after this final step has been completed can the variety be marketed.

The analysis of varieties for their inclusion is led by official organisations. One can cite GEVES in France, the BSA of Germany, or the NIAB in Great Britain.

The inclusion of a variety in the official catalogue requires that it satisfy two sets of tests. On the one hand, the DHS (Distinction, Homogeneity, Stability), on the other hand, the ATV (Agronomic and Technological Value).

The VCU of the varieties of forage species is based on three main sets of factors:

  1. Production of biomass
  2. Disease resistance
  3. The biochemical composition (in particular the protein content, wall content, and sugar content).

Most European countries have defined conditions concerning the presence of endophytes in varieties. These conditions are either the complete absence of endophytes, or the absence of toxic endophytes.

Description of the Regulation

Established in 2004, the initial purpose of the current regulation is to ensure the quality of marketed seeds.

 

 


¹after the information of: JAMET J.P. (2005). La politique laitière et son contexte. Fourrages, 181; 3-8.

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