EN Official Journal of the European Union C 157/167

Opinion of the European Economic and Social Committee on the ‘Communication from the Commission to the Council and the European Parliament: European action plan for organic food and farming’

(COM(2004) 415 final)

(2005/C 157/30)

On 15 October 2004 the Commission decided to consult the European Economic and Social Committee, under Article 262 of the Treaty establishing the European Community, on the abovementioned communication.

The Section for Agriculture, Rural Development and the Environment, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 16 November 2004. The rapporteur was Mr Voss.

At its 413th plenary session, held on 15 and 16 December 2004 (meeting of 16 December), the European Economic and Social Committee adopted the following opinion with 70 votes in favour and two abstentions.

1. Introduction

1.1 The number of organic farms in the European Union has increased sharply in the last fifteen years. Between 1985 and 2002 the number of organic farms in the EU-15 rose from 6,300 to 150,000 and the area farmed by them from 100,000 ha to 4.4 million ha. This is equivalent to these farms' share of agricultural land rising from 0.1 % to 3.3 %. Organic food sales are worth EUR 11 billion in Europe and EUR 23 billion worldwide.

1.2 The development of organic farming, which was mainly due to farmers supported by consumers, began in the 1920s. Sustained consumer demand in specialised markets became established in the 1970s. A variety of socio-economic players started to expand, promote and monitor organic production and marketing in the 1980s.

1.3 Council Regulation (EEC) No. 2092/91 was the first piece of legislation on organic farming to be drawn up by the EU, on the basis of the preparatory work carried out over a period of many years by the leading organic farming associations. EU support was first provided in 1992, when this type of farming became part of agri-environmental policy.

1.4 The Agriculture Council called on the Commission in June 2001 and again in December 2002 to present an action plan for organic food and farming. In the meantime the Commission has conducted a consultation exercise on the Internet in which 1,136 citizens and organisations have taken part. The results have, inter alia, been used for the Commission staff working document on the feasibility of a European action plan for organic food and farming. A European Parliament hearing was held in July 2003, and in January 2004 the launch of the action plan took place at an event that was well attended by European governments and organisations and members of the general public.

1.5 The action plan represents a crucial contribution to the further development of the common agricultural policy and gives a good picture of the special role to be played by organic farming in future agri-environmental policy. This enhanced role depends on the cooperation of economic stakeholders and especially producers. The economic interests of the farms must therefore be taken into account. The early involvement of national and regional government bodies in the Member States will be decisive for the success of the plan.

1.6 The EESC welcomes the European action plan for organic food and farming. It would point out, however, that sufficient human and material resources are required within the EU administration to perform the related tasks satisfactorily. In this connection, the Committee is pleased to note that at its first reading the European Parliament decided to include the action plan under the budget headings for support measures, including measures for improving the quality of agricultural production.

2. Content of the Commission document

2.1 The Commission notes that organic farming makes a major contribution to various EU policy measures which are designed to provide a high level of environmental protection. The problem areas listed are: pesticides, plant nutrients, soil protection, biodiversity, nature protection, animal welfare, and food safety.

2.2 The Commission's main aim is to expand the organic farming sector steadily and exploit market potential. Special attention is to be paid in this connection to farm incomes. This is to be done with due regard to the dual role of organic farming, namely a) to produce organic produce which has to fetch higher prices because of the non-use of environmentally important inputs and the lower yields resulting therefrom, and b) to deliver public goods which have no market price and therefore have to rely on public funding.

2.3 The action plan has three priorities: — to make the development of the organic food market information-driven and increase consumer awareness; — to make public support for organic farming more effective; and — to improve and reinforce EU standards and import and inspection requirements.

2.4 The plan makes provision for 21 actions, two of which have budgetary implications and are subject to the availability of funding. Implementation of the action plan depends on the availability of Commission staff. Subject to these provisos, the Commission intends to introduce the requisite measures as indicated without delay. The action plan makes no specific provisions for targets and timetable.

3. General comments

3.1 Reform of the CAP

3.1.1 The Luxembourg agricultural reform decisions of June 2003 stipulate for many products a cutting back of administrative price controls and an erosion of the safety net. However, thanks to a large-scale decoupling of direct payments from production, which is a new cornerstone of the agricultural reform decisions, the Commission anticipates a stabilisation of prices and even an increase in prices for agricultural produce. Because producer price levels for organic produce depend on the general level of producer prices, new opportunities to earn a living can arise on the market for organic farmers. The Committee would stress that this will only be possible if the Community preference is maintained at an adequate level for all agricultural produce .

3.1.2 The promotion of organic farming depends, inter alia, on the total funds available in the second pillar of the CAP. Member States are under no obligation to promote this agricultural reform. The EESC notes that in European countries and regions that do promote organic food and farming, this sector of the economy is particularly extensive and very stable. The pace of development and implementation of the new European Agricultural Fund for Rural Development (EAFRD) in the Member States should be carefully monitored.

3.1.2.1 The Committee is following the forthcoming decisions on the Union's financial perspectives with great concern. Rural development resources, in particular, are threatened with cuts. The EESC points out that these resources are of crucial importance for the stabilisation and innovative development of Europe's rural regions. The Committee has already set out its views on this subject in its own-initiative opinion on future rural development policy (1) and is currently working on an opinion on the proposal for a regulation on the European Agricultural Fund for Rural Development. (2)

3.1.3 More and more stakeholders are interested in receiving rural development funding, and numbers are increasing further with the accession of ten new countries. Even if 80 % of the funds earmarked for modulation have to be used in these funds' country of origin, the additional financing available here is very limited.

3.1.4 Organic farming, even more than other agricultural practices, has vast potential for delivering public goods. The Committee would urge the Commission, Council and Parliament to ensure that changes to the CAP agreed upon in June 2003 should not jeopardise good land management practices. Furthermore, the funds allocated to the second pillar (rural development) should be sufficient to fulfil Community priorities.

4. Specific comments

4.1 The organic food market

4.1.1 Consumers' perception of organic products

4.1.1.1 The stakeholders involved in organic farming, and especially producers, have already won an appreciable share of the food market to the point where the EESC considers that the term ‘niche market’ can no longer be used in every Member State to describe this market share. In many EU regions and for some products, the proportion of organic farms and foods is already very high. Many raw materials for baby food, for example, are already organically produced.

4.1.1.2 Europe has regional and product-specific concentrations in production, processing and market development, as well as in research and initial and further training in the organic foods sector. The reason for this may be either natural regional specificities or a dynamic interaction of local economic players. The Committee calls on the Commission to pay particular attention in this action plan to this clustering in organic farming that is common in Europe.

4.1.1.3 Organic food has safeguarded the livelihood of many enterprises, especially on the production side but also in processing and marketing.

4.1.2 Market mechanisms

The higher marketing costs for organic produce certainly contribute in part to the higher prices in the production, processing and retail sectors. Therefore the Committee strongly welcomes initiatives on regional processing and marketing structures, because this can bring producers and consumers closer together and make it possible to understand how prices are formed. On the other hand, the food retail sector is now extremely concentrated in some Member States, and this exerts considerable pressure on producer prices in the organic sector, too.

4.1.3 An information-led demand

The Committee expressly welcomes the measures proposed in Action 1 for supporting the promotion of information and sales. They should, however, incorporate individual Member States' experiences, since special pressure on purchasing prices is exerted by industrial kitchens, canteens, schools and the like. Industrial kitchens which feed children, the elderly and the sick represent an important market.

4.1.4 Market problems due to variations between standards

The envisaged establishment of an Internet database for comparing differing regional and national regulations can be a useful instrument for promoting trade in goods in the single market. However, the demand for all differences to be completely eliminated would be going too far. These differences often have regional, sectoral and cultural roots and are a driving force for innovation and for developing standards and product quality further.

4.1.5 Monitoring and analysis of supply and demand

It makes sense to improve the collection of statistical data on organic production and the market in organic products (action 3). However, in collecting and processing this additional data, care must be taken to ensure that the partners involved in this market (a small number of large trading firms on the demand side and a large number of small and medium-sized farms on the supply side) are able to benefit equally from such data or at least that farmers do not suffer any serious disadvantages. The collection and prompt publication of this sector's statistical data in the new Member States is still something to work towards.

4.2 EU policy on organic farming

4.2.1 Organic farming in the framework of the common agricultural policy

The Committee would query whether the European model of multifunctional agriculture, to which organic farming with its environmental services makes an important contribution, is being given sufficient prominence in the WTO international negotiations in order to ensure the viability of the CAP and, more especially, in order to ensure that aid under the second pillar of the CAP continues to qualify as ‘green box’ aid.

4.2.2 Rural development

In addition to the development of a web-based menu of all EU measures (action 5), it is suggested that, in order to promote the local production of organic food, the hygiene and health standards applicable to small and medium-sized food processing and marketing firms be geared to their special risk potential. The standards laid down for bulk processors are frequently not applicable to small firms with restricted regional processing and marketing volumes and often impede investment and therefore hamper job-creation in rural areas. The Committee stresses in particular the need for appropriate standards for small-scale regional firms processing and marketing both organic and conventional produce. For this reason, they should benefit from the derogation framework for the processing sector. For the EESC, the absolute priority remains of course compliance with the principles of food safety laid down in the White Paper on food safety and hygiene and in recently adopted legislation.

4.2.2.1 With regard to the initiative proposed under action 6 for targeting the establishment of organic farming in environmentally sensitive areas, care should be taken to ensure that this does not lead to an imbalanced supply situation and subsequently to politically-driven distortions of competition within organic farming. The difficult arable farming conditions in these areas must be adequately described.

4.2.2.2 In the EESC's view, the action programme does not take account of the great significance of the organic farming and foodstuffs sector for employment, particularly in rural regions. Surveys in EU Member States have shown that organic farming is almost exclusively responsible for new start-ups in farming and its upstream and downstream sectors. The Committee would also stress that all quality agricultural produce bearing an indication of regional origin will have a positive impact on rural development.

4.2.2.3 Training, education and advice are described in Action 6. A clearer emphasis on delivering information and knowledge in the rural development context is needed in order to strengthen these farming production methods and the marketing and processing of organic products.

4.3 Research

4.3.1 Organic farming is a type of farming which specifically uses and develops methods, instruments and techniques that have the least possible impact on the environment.

4.3.2 The Committee sees publicly financed research for organic farming as a particular challenge. Research fields which have little private-sector investment and which are of major importance for society must be made key areas of publicly supported research. Both organic farming and technology impact assessment should be given priority status in the EU's Framework Programme for Research.

4.3.3 The Committee welcomes more research into organic farming. The aims of this research must be distinguished more clearly, and their consistency with other areas of the common agricultural policy checked. Education, knowledge transfer and the importance of interdisciplinary science are the premise for the successful development of an organic food sector and should be given greater weight — including financial — in the Commission's action plan.

4.3.4 There is an urgent need for organically-oriented research into plant cultivation and livestock breeding. This includes further development of modified breeds and species to ensure market viability.

4.4 Standards and inspection — safeguarding integrity

4.4.1 The regulatory concept

Despite the existence of a regulation on organic farming, no basic principles have been laid down hitherto. The only possible explanation for this is historical. Basic principles have long existed in some Member States with a long tradition of organic farming. An understanding should be reached here, to be followed by a definition of the principles (action 8). Account should be taken of the experiences of the IFOAM (3). The Committee particularly wants the historical development in the new Member States to be taken into account.

4.4.1.1 It should also be borne in mind that in the view of a number of national organic farming organisations, the concept should encompass not only environmental criteria but also socio-economic principles, such as the creation of valuable jobs offering social stability in rural areas. The adaptation of the regulations on organic farming should then take place on a case-by-case basis,stressing the need to comply with the basic principles, and the granting of transitional periods with fixed end dates should be reviewed stage-by-stage (action 9).

4.4.2 The scope of organic production standards

Apart from calling for simplified and harmonised plant and animal husbandry rules, care should be taken to ensure that small and medium-sized farms continue to influence developments in husbandry so as to obviate monopolistic structures similar to those to be found, for example, in the case of many crops and in chicken farming. In chicken farming it is already impossible to supply farms with organically suitable breeds. Investment subsidies should be contemplated for the implementation of improved animal welfare standards, since expensive new or converted premises can frequently be required to house the animals. In the arable farming sector there are still no rules on trade in traditional plant varieties or old crop varieties no longer listed in the register of varieties. The Committee finds this regrettable and urges the Commission to take the necessary steps to introduce the required measures.

4.4.2.1 In action 10 (last indent) it is necessary to clarify whether ‘biodiversity’ means crops and livestock or whether it has a broader meaning and refers to all fauna and flora. The EESC would also point out, however, that according to the objectives of the CAP, preservation of biodiversity cannot be the responsibility of organic farms alone.

4.4.2.2 Although energy- and resource-saving practices are at the heart of organic farming, the EESC rejects introducing special standards. The priorities here are effective general agricultural and economic provisions.

4.4.2.3 The creation of the first-ever EU standards for organic wine and aquaculture products is expressly welcomed. In particular, the Committee also sees the positive effects on conventional practices in the sectors.

4.5 The establishment of an independent expert panel for technical advice, as proposed under action 11, is welcomed by the Committee provided that stakeholders, i.e. farmers, processors and consumers, are suitably involved so that such a panel enjoys the public's confidence. However, there is a lack of specific provisions concerning the timetable, goals and budget resources needed to make a success of this initiative.

4.6 Genetically modified organisms

4.6.1 The Committee regrets that on this point the action programme deals only with thresholds and does not propose a comprehensive approach to ensure co-existence as a prerequisite of organic farming in Europe.

4.6.2 The ban on the use of GMOs in organic farming is of particular importance in the context of the ongoing discussion on co-existence rules. The recommendations proposed under this point can be accepted to a large degree. The non-GMO farming sector (conventional and organic) should not have to bear any of the costs or loss of income arising from the release of GMOs.

4.6.3 The general thresholds for seed in organic farming must be the detection limit (action 12). In the Committee's opinion, the detection limit should also be the threshold for conventional non-GMO seed. Otherwise, it is to be feared that the presence of GMO components in organic products, too, might rise rapidly, thereby jeopardising the foundations on which organic farming in Europe is based. Because of the free movement of goods and the presence of vast areas of agricultural land on both sides of national borders within the EU, harmonisation is necessary here, too.

4.7 Inspection systems

Implementation of the risk-based approach to improve inspections (action 13) is to be endorsed. The EESC points out that the German version of the action plan, unlike the English, states that agricultural producers present the highest risk in terms of fraudulent practices. The EESC urgently requests this to be corrected. The inspection system's risk analysis and risk management should take account, rather, of the exposed flanks in sectors further upstream and downstream such as processing and trade. The inspection systems must be improved by cutting red tape and costs. An efficient networking of inspection organisations could be helpful.

4.8 Imports

4.8.1 When the rules governing imports of organic produce are refined, account should be taken of the growing risk of GMO contamination.

4.8.2 The Committee recommends looking at the promotion of the Mediterranean economic area when considering the possibilities of organic farming. The point is to strengthen the centres of organic cultivation and to promote their networking.

4.8.3 Organic products must not be granted more far-reaching concessions than conventional imports in international trade agreements. This is necessary for reasons of competition and, in particular, in order to ensure that organic farming in Europe continues to have a chance on the market.

5. Summary

5.1 The Committee welcomes the proposed action plan for organic food and farming. It is a fitting response from the Commission not only to the call of the Agriculture Council, but to the expectations of many citizens. With the implementation of cross-compliance and the definition of conditions of good agricultural and environmental practice, the environmentally-friendly development of European agricultural policy has to face higher demands.

5.2 The EESC welcomes targeted marketing campaigns and consumer information. It does not, however, expect existing imbalances in the food industry and in processing to be increased.

5.3 This important sector for employment prospects and production of public goods must get the attention it merits in the EAFRD programme, in connection with the measures linked to the quality of agricultural produce.

5.4 Efforts to harmonise norms and inspections must not overburden businesses and must allow for regional specificities. In the case of both EU- and third-country goods, the EU logo should not prevent identification of origin.

5.5 On the matter of co-existence with GMOs, the question of how Europe-wide organic production can be guaranteed in the future remains unanswered. For this reason, the GMO contamination limits for all seeds should be set at the detection threshold.

5.6 Organic farming must be given a higher priority in the EU's research plan. This prioritising is justified by the great importance for society as a whole and the meagre private research resources available to this sector.

5.7 With the European Parliament's decision to make funds from the budget heading for improving the quality of agricultural production available to the action plan, European decision-makers have begun to combat the shortcomings in staffing and materials resources referred to above.

5.8 The EESC is monitoring discussion of the financial perspectives with great concern. A cut in resources for rural development would also set back organic farming and the organic food sector in Europe.

Brussels, 16 December 2004. The President of the European Economic and Social Committee Anne-Marie SIGMUND

(1) Own-initiative EESC opinion on The CAP second pillar: outlook for change in development policy for rural areas (follow-up to the Salzburg conference)

(2) EESC opinion currently in the pipeline on the Proposal for a Council Regulation on support for rural development by the European Agricultural Fund for Rural Development (EAFRD)

(3) International Federation of Organic Agriculture Movements