Opinion on the proposal for a Council Regulation (EC) amending Council Regulation (EEC) No 1765/92 establishing a support system for producers of certain arable crops ()

(96/C 97/10)

On 20 December 1995, the Council decided to consult the Economic and Social Committee, under Articles 43 and 198 of the Treaty establishing the European Community, on the above-mentioned proposal.

The Section for Agriculture and Fisheries, which was responsible for preparing the Committee's work on the subject, adopted its Opinion on 11 January 1996. The Rapporteur was Mr Pricolo.

At its 332nd Plenary Session (meeting of 31 January 1996), the Economic and Social Committee adopted unanimously the following Opinion.

1. Introduction

1.1. It seems advisable to point out first of all that, in taking the initiative to present to the Council a proposal which in fact seeks to amplify, rather than amend, the basic Regulation 1765/92, the Commission is motivated by the wish to implement the pledge made by the EC to the USA concerning oilseeds under GATT (the 'Blair House Agreement').

1.2. Regulation 1765/92 sets up a system of compensatory aid per hectare as from the 1993-1994 marketing year for producers of certain arable crops in order to compensate the loss of revenue resulting from the reduction of institutional prices, i.e. the progressive alignment of EC prices on those on the world market.

1.3. Any producer who asks for the payment of per hectare aid under the 'general regime' (a 'simplified regime' is provided for small producers) is obliged to withdraw some of his farmland from production (the initial percentage was 15 %; currently it is 10 %), for which he receives compensation under Article 7(4) and (5).

1.4. The 'Memorandum of Understanding' on oilseeds concluded by the EC and the USA in June 1993 stipulates that the EC 'shall take appropriate corrective action within the framework of the CAP reform' if 'the by-products made available as a result of the cultivation of oilseeds on land set aside for the manufacture within the Community of products not primarily intended for human or animal consumption exceed one million tonnes annually expressed in soya bean meal equivalent'.

1.5. The Commission considers there has been a big increase in the cultivation of oilseeds on set-aside land and fears that the 1 million tonne limit may be exceeded; so, it is now proposing to the Council that measures be introduced to monitor and forecast production trends in order to avoid any breaches of the limit on by-products (oil cake and meal) intended primarily for use as animal feed.

1.6. Basically, a scheme for monitoring the delivery contracts concluded annually between farmers and seed crushers will enable the volume of soya meal equivalent which could be produced to be worked out.

1.6.1. If production estimates suggest that the 1 million tonne ceiling might be breached, the amount of by-products authorized in each delivery contract would be reduced.

2. Comments

2.1. The ESC feels that from a purely formal standpoint the Commission's proposal fits in with the EC's pledges to the USA under GATT.

2.2. However, it considers that there is no real or imminent risk of the 1 million tonne ceiling for soya meal equivalent being breached.

2.2.1. Production of oilseed by-products on set-aside land remained below this threshold in 1995.

2.2.2. There should be no increase in EU production in 1996 for the following reasons:

a) the percentage of set-aside has been reduced from 15 to 10 %; and

b) no measures have been adopted at Community level to remove taxes on fuels of agricultural origin.

2.3. In addition, world output for 1996 is expected to be 2 to 3 % down on the previous year due to forecasts of a 7 million tonne drop in the US soya harvest and a big fall in Brazilian production.

2.4. Although the Commission's initiative is aimed basically at setting up, under the basic Regulation 1765/92, the legal machinery for ensuring that the Blair House pledges are kept, the ESC would still point out that, at the end of the day, the proposed measures will discourage the growing of crops which might be used for the extraction of fuels.

Done at Brussels, 31 January 1996.

The President

of the Economic and Social Committee

Carlos FERRER

() OJ No C 12, 17. 1. 1996, p. 11.