Proposal for a COUNCIL REGULATION (EC) No ... amending Regulation (EEC) No 804/68 on the common organization of the market in milk and milk products
Date: 1996-03-01
Institutions: European Commission
Subjects: marketing year, milk, milk product, target price, tariff quota, third country

COMMISSION  OF  THE  EUROPEAN  COMMUNITIES 

It 

* 

Brussels,  14.2.1996 
COM(96) 44  final 

VOL  I 

COMMISSION  PROPOSALS 

on the  prices  for  agricultural  products 

and  on  related  measures  (1996-1997) 

VOLUME  I 

Explanatory  Memoranda 

The Commission submits herewith its proposals for the agricultural prices for  1996/1997 and 
for certain related measures.  The text is in three parts : 

-/  <K 

Volume I 
Volume II 
Volume HI 

Explanatory Memoranda 
Financial  implications 
Legal  instruments 

Summary of Volume I 

Introduction 

. 

A. 

General  considerations 

I.  General  economic  situation 

H  The agricultural  economy  in  1995 

HI.  Agrimonetary measures and budget 

TV.  Medium term outlook for certain commodities 

V.  Price proposals and accompanying measures 

B. 

Explanatory  memoranda bv product 

1.  Arable crops . 
2.  Cereals 
3.  Protein crops and linseeds 
2.  Grain legumes 
3.  Rice 
4.  Sugar 
5.  Olive  oil 
6.  Fibre plants 
7.  Wine 
8.  Fruit and Vegetables 
9.  Milk and milk products 
10.  Beef  and veal 
II.  Sheepmeat and goatmeat 
12.  Pigmeat 
13.  Tobacco  . 

£âgê 

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C. 

Annexes 

I.  Report on protein crops and linseed 

H.  Report on beef and sheep sectors 

D. 

Tables 

1i 

25 

30 

1.  Price proposals in ECU for the various agricultural  products  .  .  x 

2.  Stabilizers and production thresholds 

3.  Trends in economic indices 

x 

x 

Vol  I EN  -  1  c. 

INTRODUCTION 

This  year  price  fixing  continues  the  policy  of  stable  prices  and  aids  which  has 
applied since the  1992 reforms. 

In the arable sector prices and aids levels were set in  1992 for the indefinite  future 
and no new decisions  are required now.  For other sectors, unchanged  prices  and 
aids are proposed in this package. 

This  stability  in  terms  of  support  levels  does  not,  however,  imply  stagnation  of 
policy. Within the sectors which were reformed in  1992 two major simplifications 
are proposed, a unification of the rates of rotational and non rotational set aside and 
the introduction of a single premium for young bulls in place of the current system 
of two annual premia. 

This prices  package  should  also  be  seen  in the  context  of  the continuing  process 
of reforming those sectors not covered by the  1992 decisions  A  new rice  regime 
was agreed last December, Council discussions on reform of the fruit and vegetables 
regime are well  advanced; the Commission has been glad to note the intention  of 
the Italian Presidency to recommence the discussions on the proposed reform of the 
wine regime; and it intends to make proposals for the reform of the olive oil regime 
in the near future. 

This  package,  based  on  stability  with  certain  simplifications,  has  amongst  its 
objectives  that  of  contributing  to  the  battle  against  waste  and  fraud  and  the 
improvement of sound financial management The Commission strongly encourages 
the Council to respect the paramount importance of this objective. 

Vol I EN - 2 

GENERAL CONSIDERATIONS 

1. 

General economic situation 

After  the relatively  strong recovery of economic growth in  1994 (2.8%),  the EU economy 
exhibited  a  similar  rate  of  growth  in  1995, put  at  2.7%  according  to  the  latest  available 
official  estimates. There are however indications that a slowdown of growth occurred in some 
of the major economies in the second half of the year (eg Germany and France), which might 
lead to a downward revision of the 1995 figure. A resumption of growth is still expected for 
the second half of  1996, putting the figure for the year as a whole at 2.6%. For  1997 some 
further  (modest) growth acceleration is forecast. 

Private consumption is expected to pick up more gradually helped by rising employment and 
moderate increases in real wages. The rate of unemployment is expected to fall from 10.7 % 
in  1995 to  10.3 %  in  1996 and to just  below  10 % in  1997 on  average. Inflation  should 
remain subdued in 1996 (3.0%) and fall further to 2.7% in 1997 due to a rather gentle growth 
and a moderation in wage increases. 

2. 

The agricultural  economy in  1995 

This year saw the implementation of the final part of the  1992 reform. The improvement in 
the economic situation of farming in the Community continued and was further  strengthened. 
While weather  conditions for  farming were fairly  satisfactory  in  1995 in most areas of the 
European  Union,  farmers  in  a  large  part  of  the  Iberian  peninsula  had  to  cope  with 
exceptionally  high temperatures and drought for the fourth  year running. 

The main agricultural markets 

Community cereals production for  1995 is estimated at approximately  175 million tonnes, a 
little higher than the  172 million tonnes of  1994. The rise of just over 2% in the area sown 
to cereals due to the reduction of set-aside by 3% and a switch from oilseeds to cereals (due 
to an overshoot of the oilseeds base area) was partially compensated by a fall in yields (Spain 
and Portugal). By  contrast, yields in  other Member  States rose appreciably,  particularly  in 
Northern Europe. 

Initially, market prices have reflected,  although with a delay, reductions in the intervention 
prices adopted under the reform. Subsequently however, these price drops have been reduced 
on some markets, for some countries by the successive devaluations of certain green rates or 
by the reduction in  surpluses following  the drop in production  and the massive disposal of 
intervention stocks, and by other factors (quality of the harvest, quantities withheld from the 
market by producers or collecting organizations, improvements in prices on the international 
market, etc.). At the end of December  1995, for example, the price for common wheat was 
23% higher than the intervention price in Rouen and 48% higher in Milan. It is expected that 
a  reduction  in  the  set-aside  rate  to  10% for  rotational  and  non  rotational  set  aside  and  a 
cooling of prices on the world market will go some way to alleviate this situation. 

Vol  I EN - 3 

The area sown to oilseeds  in  1995 was down overall  on the previous year as a result of the 
cut in compensatory aid in 1994/95, following the overshoot of the maximum guaranteed area 
in certain Member States. The drop in sown areas was particularly significant  in the case of 
oilseeds grown for food uses (about - 8% on average). The fall was partially offset  however, 
by the significant  increase in the areas sown to oilseeds for non-food uses (up 57% on  1994 
for all  oilseeds and more than 70% for rape). 

Overall  production  of  oilseeds  (food  and  non-food)  is  expected  to  be  around  12.3 
million tonnes in  1995,  slightly  down  on last year.  Those grown  for  non-food  uses  should 
increase from 1.4 to 2.2 million tonnes, a rise of just under 60 % in one year. 

After falling sharply in  1994, sugar production rose slightly in  1995 (+ 3.6% on average for 
the European Union  as a whole)  as a result of  a slight increase in the areas under beet and 
a small rise in sugar yields, which nevertheless remain below those of  1993. 

The  1995 Community wine harvest, provisionally  estimated at  150 million hi is around this 
level  for the third year running, considerably  less than it was in  1992 or even in  1993 when 
the  harvest  was  relatively  modest.  Production  is  down  in  most  of  the  producer  countries 
because  of  poor  weather  conditions  and,  in  certain  cases,  the  drop  in  planted  areas.  The 
combination of these factors together with the elimination by distillation of surpluses that had 
built up in earlier years has brought about a relative equilibrium on the market in recent years 
which  has  had  a  positive  impact  on  prices  (there  will  be  no  compulsory  distillation  in 
1995/96).  In the majority of producer countries the prices for red wine in national currency 
at  the  end  of  December  were  considerably  higher  than  at  the  same time the  year  before 
(+ 48% in Italy, +  6% in France and +  9% in Spain). 

Milk  production in  1995 is  estimated to be very  slightly  up on the previous year (+  0.5%) 
due to  an increase in yields,  despite  a reduction  in the dairy herd. Deliveries  to dairies are 
expected  to  remain  virtually  unchanged,  at last  year's level,  for  the  European  Union  as  a 
whole. The drop in butter production noted in recent years continued in 1995 (- 40  000 tonnes 
compared with  1994). Butter production has fallen therefore by around 450 000 tonnes since 
the beginning of the 1990s. By contrast, cheese production continues to rise (+2.1% in 1995 
compared with  1994)  as  a result  of  increasing  consumption.  The  fall  in butter production, 
together with the almost total exhaustion of public intervention stocks, has pushed up prices 
on the butter market. In almost all the Member States these were above the intervention price 
at the end of September  1995. Over  1995 butter prices rose on average by about 9% helped 
by the conjunction of a number of positive factors on the world market (lower production in 
some exporting  countries and rising demand in some importing countries, etc). 

After several years of cyclical fall,  beef and veal production began the upward phase of the 
cycle in  1995. In  1996 it is expected to rise by around  1.9% following the 2.7% rise in  1995 
and the fall  of more than 4% in  1994. 

Vol I EN - 4 

In accordance with the decisions taken in  1992, intervention prices for beef were reduced by 
6.2% at the beginning of July  1993, by 5.3% at the beginning of July  1994 and by  5.6% at 
the beginning of July  1995. These institutional price reductions were partially reflected  in the 
market prices. However, actual reductions were as a rule less than those in the institutional 
prices  because  of  the  drop  in  production  in  recent  years  and  the  substantial  reduction  in 
intervention  stocks. There has also been an additional impact on prices in national  currency 
resulting  from  the  monetary  adjustments  since  September  1992.  With  the  recovery  of 
production, prices fell  in the first half of  1995, before recovering some of the lost ground in 
the autumn. For the most part these remained above the level at which tenders for intervention 
can be opened and in the few cases where tenders for intervention were opened, no purchases 
were made. 

In  1995 pigmeat production is estimated to be slightly down on the previous year (- 0.6%), 
in line with the drop in the pig herd for the European Union as a whole. As a result, pigmeat 
prices firmed up throughout the year, with the exception of a setback in May and June. In 
December  1995 they  were  on  average  11%  higher than they  had been the previous  year. 
Production may fall  slightly in  1996 but a recovery can be expected towards the end of the 
year. 

In  1995  poultry m eat  production  rose  by  an  estimated  2.9%,  after  a  similar  increase  the 
previous year. This growth is expected to continue at slower rate in 1996. Prices in early 1995 
remained considerably  below those for  1994, but by December  1995 were at a comparable 
level as the same time the previous year. 

The slight drop in the production of sheepmeat and goatmeat in  1994 (- 0.8%) turned into 
a  small  increase in  1995 (0.3%). However  a slight decline in production  (-0.9%) is  again 
expected  in  1996. Average prices in  ecus at the end of December  1995 were around  10% 
lower than at the same time the previous year. 

Producer prices 

It is estimated that the index of nominal producer prices for all agricultural products increased 
by averages of 2.7% for EUR-15 in  1995 and 3.4% for EUR-12 compared with the previous 
year. This corresponds to falls of 0.3% and  1.1% respectively in real prices. 

It  should  not be forgotten  in this connection that since  1993 the support  prices for  certain 
products (in particular  cereals and beef)  have decreased  each year and that producers have 
instead  received  increasing  compensatory  aids,  which  are  not  taken  into  account  in  the 
producer price index. 

Vol  I EN - 5 

Compared with  1994, the producer price index for crop products increased in real  terms by 
an average of  1.5% (2.0% for EUR-12). However, the situation varies considerably from one 
product  to  another.  In  the  cereals  sector,  real  producer  prices  remained  more  or  less 
unchanged (-0.7% on average), those for fresh vegetables fell  by an average of 4.4%,  while 
the decrease was over 5% for oilseeds.  On the other hand, potato prices rose by  nearly 8% 
in real terms, wine prices by over  10%, fresh fruit 3.7% and olives and olive oil  9.4%. 

The producer price trend was, generally speaking, less satisfactory  for livestock products. It 
fell,  in real terms, by 3.6% on average, with decreases of as much as  12.5% for eggs, 9.5% 
for poultry, 8.4% for cattle and 5.5% for sheep and goats. The only livestock sector in EUR-
15 which showed an upward trend was pigmeat, for which prices rose by an average of 3.5% 
in real terms. 

\ 

In  1995  the general  producer price index,  in real terms,  showed  an upward trend in  Spain 
(+1.5%), Italy  (+1.5%) and the United Kingdom  (+3.1%) and a downward one in Belgium 
(-4.5%), Germany (-3.6%), Luxembourg (-4.4%), the Netherlands (-4.2%) and also in Sweden 
(-4.1%),  Austria (-23.6%) and Finland (-26.6%). 

Farm incomes 

Incomes are expected to have risen in 1995 in the crop sector (cereals, wine, olive oil,  fruit). 

Livestock production, in particular eggs and poultry, sheep and goats and cattle farming has 
come under some pressure. However in the cattle,  and sheep and goat sectors the negative 
impact of the fall  in  producer prices has been largely  offset  by the increase in the level  of 
premiums.  Conversely, pigmeat production continued to become more profitable  in  1995 as 
producer prices improved. 

Unlike  1994,  during  which  all  EU  12 Member  States recorded  an increase  in  agricultural 
income in real terms, 1995 was characterised by a great variation among Member States. Five 
Member States, Greece, Spain, Portugal, the Netherlands and Belgium exhibited a decline in 
farm income ranging from -9.8% in Belgium to -1.7% in Greece. All five countries exhibited 
a strong growth in income in 1994. 

The other EU 12 Member States exhibited increases in farm income for the second successive 
year ranging from United Kingdom (+16.6%) and Denmark (10.5%) to Germany (3.0%) and 
Ireland (1.6%). 

Developments  of  income  were  not  uniform  in  the  three  new  Member  States.  In  Austria 
income was little changed, Sweden recorded the strongest EU 15 increase of 25.7% following 
a  21.3% drop in  1994. Income in Finland dropped 7.5% in  1995  following  a smaller drop 
(-1.7%) in  1994. 

Vol I EN - 6 

3. 

Agrimonetary  measures and  budget 

The  1996  budget  guideline  for  the  EAGGF  Guarantee  Section  amounts  to  ECU  40,823 
million, representing an increase of ECU 2,844 million on 1994. About ECU  1,000  million 
of this increase is due to the integration of the full  effect  of the GNP of the Union resulting 
from enlargement  The remainder of the increase essentially reflects the growth in GNP for 
the Union as a whole and the development of the GNP deflator.  The impact on the budget 
of  the monetary  realignment  within  the EMS  between  September  1992 and  May  1993  is 
estimated at ECU  1,746 million. 

The 1996 budget has also taken into account the consequences of the decision of June 1995 
to maintain, for  a number  of Member  States with appreciating  currencies, the agricultural 
conversion rates applicable to certain direct aids at unchanged levels and to grant degressive 
compensatory  aid  to  producers  for  income  losses  resulting  from  the  reduction  in  the 
conversion rates applicable to other measures. 

Throughout this Volume, all amounts are expressed in "new" ECU even when they refer to 
the  period  before  1.2.1995  when  the  switchover  coefficient  was  abolished,  to  facilitate 
comparisons. 

4. 

Medium-term  outlook for certain commodities 

Two  main  factors  continue  to  influence  the  evolution  of  EU  agricultural  markets  in  the 
medium-term  horizon: the new policy  environment  as a result of the CAP reform  and the 
application of the GATT agreement. 

In summary, under the assumption of stability in the CAP, the outlook for cereals, oilseeds, 
livestock and dairy products is the following. 

For cereals, area allocation is affected  by the level  of set-aside. If the current standard  set 
aside rate (15 % for rotational  set aside and 20 % for non rotational  set aside) were to be 
applied for the 1997/98 marketing year the cereals area should be around 32 million hectares. 
Within cereals, the share of soft wheat is expected to increase at the expense of barley, and 
remain rather stable for the other cereals. Yield trends are expected to continue the slower rate 
of  annual  growth  observed  since the  mid  1980s, thus resulting  in  a level  of  total  cereals 
production close to 190 million tonnes by the year 2000. Cereals consumption should regain 
the momentum  of the first year of CAP reform,  provided that world cereals prices decline 
from their  present,  historically  high,  levels,  thus  influencing  the  adjustment  of  domestic 
market prices towards the intervention price level. 

Vol  I EN  -  7 

Area allocation in the oilseeds sector, which is determined by the maximum guaranteed area, 
coupled  with  reductions  in  aid  for  Member  Sates who  contribute  to  any  overshoot  should 
stabilise  the  area  at  around  5.3  million  hectares  by  2000.  With  yields  increasing  at  much 
lower rates than in the past, oilseeds production should be only slightly higher than its current 
level by the end of the decade. The level  of oil cake for livestock production produced from 
oilseeds grown  for  non food  purposes is  approaching the limit foreseen  in the Blair House 
Agreement This limit will, therefore act as a constraint on non food oilseed production unless 
new end uses can be found for the oilcakes. 

Beef  production  has entered into its  cyclical  upturn in  1995. However,  its  present level  is 
lower  than  previous  cycles  mainly  due  to  the  very  strong  herd  decline  in  Germany.  The 
current beef cycle should thus reach its peak in  1997. However, many uncertainties continue 
to persist  in the  sector,  in particular with respect to consumption.  It is not unreasonable  to 
hope that consumption will stabilize, with the positive impact of income growth offsetting the 
increased  competitiveness  of  other meats,  in particular poultry. But this  equation  could  be 
upset if income growth falters or if there were renewed or intensified health concerns. On the 
more  optimistic  hypothesis,  therefore,  market  equilibrium  in  the  medium  term  can  be 
maintained at current market price levels but significantly lower prices are likely if production 
restraint were to be relaxed or if demand falls. 

Pork and especially poultry consumption should continue to increase in the future, although 
their level  will be determined to a certain extent by the duration of the current high level  of 
world  cereals  prices.  Given that  production  is  mainly  demand  driven in  these  markets,  it 
should  adjust  to  the  level  of  domestic  consumption  and to  export possibilities  (which  are 
influenced  by GATT commitments). However, if Community cereals prices remain close to 
world levels,  exports without refunds at least for some products should be possible. 

Finally, the milk quota system should ensure stable milk production. A slight increase of non-
subsidised  domestic use is expected, mainly as a result of the increase in fresh products and 
cheese. However, this development will be almost totally offset by the continuing decline in 
butter consumption.  In the sector as a whole,  supply will  continue to exceed  demand by  a 
significant  margin. Whether the Union  can go to the  end of the GATT period  without  the 
need for quota reductions is heavily  dependent on consumption trends. 

5. 

Price Proposals  and  Accompanying  Measures 

In  1995/96  the support price levels  decided  in  1992 were applied  in full  for the first time. 
Their full effect, however, particularly in the cereals sector, could not be properly appreciated 
because, for conjunctural reasons, market prices were well above support levels. Nevertheless, 
there  has  been  nothing  in  the  experience  of  1995/96  to  suggest  the  need  for  fundamental 
change at this stage. The general theme of this prices package, as regards the sectors reformed 
in  1992, is one of  continuity, but with certain  simplifications. 

The simplifications  concern set aside, where a single rate is proposed for rotational  and non 
rotational  set aside,  and beef, where  a single premium for young bulls is proposed in place 
of the present two. 

Vol  I EN  - 8 

The  single rate of  set aside which is proposed  is  18 %. This reflects the fact that under the 
present  system  of  different  rates for rotational  and non rotational  set aside (normally  15 % 
for rotational  and 20 % for non rotational  set aside) producers have opted to put more than 
50 % of the land concerned into non rotational  set aside. It should be stressed that the figure 
of  18 % represents,  like the existing figures of  15 % and 20  %, the point of  departure  for 
decisions by the Council which can, in exceptional circumstances, decide to apply a lower or 
a higher rate. The Commission intends to make a proposal as regards the 1997 set aside rate 
in July  1996, if harvest data justifies  a departure from the normal rate. 

The level  of the single premium for bulls is one which enables the existing level  of support 
for this sector as a whole to be maintained unchanged. 

As regards tobacco, which was also part of the 1992 package, the Commission is due to make 
a report in April. For 1996/97, however, proposals on tobacco quotas have already been made 
and it is now proposed that premia be extended at an unchanged level. 

Continuity  is  also  provided in other sectors,  but  for wine  and fruit and vegetables,  where 
reform  proposals  are  already  under  discussion  in  the  Council,  proposals  are  made  on  a 
precautionary  basis  to  allow  the  existing  regimes  to  function  until  they  are updated  after 
reform decisions have been taken. The same is true for olive oil,  where reform proposals will 
be made shortly. 

As  regards  other  issues,  for  cotton,  where  a reformed  system  was  introduced  last  year,  a 
technical change is proposed in order to allow advance payments to be calculated more easily 
and thus to increase the proportion of the aid which can be paid before the end of the season. 

For grain legumes (chickpeas, lentils and vetches), the current aid system is exterMed and the 
maximum  guaranteed area is increased,  as requested by the Council  as part of  its  decisions 
of December  1993  on the application of the Blair House agreement on oil seeds. 

For flax, as anticipated in the 1994/95 price proposals, it is proposed to introduce a maximum 
guaranteed  area  (MGA).  This  is  accompanied  by  a  degree  of  differentiation  between 
traditional  and  non  traditional  production  techniques,  in  order  to  avoid  the  MGA  system 
having a disproportionate effect  on either system. 

In the  milk  sector,  apart from  some  purely  technical  matters,  no  changes  are proposed.  It 
should be noted, however, that this degree of stability cannot be expected to last indefinitely. 
Indeed, next year, discussions will need to begin on longer term price and quota policy as the 
expiry date of the current quota regime approaches and as the tariff reductions decided in the 
context of the GATT agreement begin to make themselves  felt 

For pigmeat, the changes in the basic price and standard quality agreed last year have allowed 
a  better appreciation  of the market  situation,  which  improved  significantly  in  1995/96.  No 
the  basic  system  of  support  level  is 
further  changes  are  proposed  now.  For  sheepmeat, 
extended unchanged but a new means of  applying  private storage, for  application for short 
term  actions in specific  markets, is suggested . 

Vol  I EN  -  9 

As regards the measures which are conditioned by interest rates (monthly increments in the 
cereals  and  rice  intervention  prices  and  sugar  storage  refunds)  reductions  are  proposed 
reflecting  the  generally  downward  trend in these  rates. For  cereals  monthly  increments,  a 
further  reduction  is  made  to  offset  the  fact  that  some  of  the  reductions  proposed  by  the 
Commission since  1992 were adopted only in part by the Council,  with the result that there 
has been too much incentive to retain cereals early in the season. 

As Annex I, the Commission is submitting the report on protein crops and linseed requested 
by the Council  in its conclusions of the price package of last year. 

As Annex II to the price proposals, the Commission is submitting a report on the beef male 
animal  premia,  on die  deseasonalisation  premium  and on  the derogations from the normal 
rules on livestock premia which are applied to the new German Lander. The proposal  for a 
single premium for young bulls emerges from this report  Other proposals arising from the 
report  are  an  extension,  on  a  slightly  different  terms,  of  the  existing  deseasonalisation 
premium  and the faculty  for those Member States liable to problems of seasonality  in  beef 
production  effectively  to  modulate  the  second  steer  premium  in  circumstances  where  the 
criteria for the normal  deseasonalisation  premium have not been met. As regards the  new 
German Lander, the existing derogations in the sheep sector are continued in view of the low 
level  of  production.  In the beef sector,  however,  it is  suggested that it is now time for  the 
Community  rules to be fully  applied. 

Vol  I EN  -  10 

B. 

1. 
1.1 

1.2 

2. 

2.1 

EXPLANATORY  MEMORANDA BY PRODUCT 

Arable  crops 
Rate of  set-aside 

When fixing the rate of set-aside for the 1996/97 marketing year, the Council asked 
the  Commission  to  consider  the  possibility  of  proposing  an  amendment  to 
Regulation  (EEC) No  1765/92 so that, in future,  as a general  rule, an appropriate 
uniform  rate of  set-aside could be fixed. 

A  uniform  rate of  set-aside  would  significantly  simplify  the rules but would risk 
weakening control of production if the rate were simply that decided on at the time 
of  the  reform,  i.e.  15%  rotational  set-aside. Producers  can currently  opt for  set-
aside  other than rotational  set-aside,  but only  on  condition  that they  set  aside an 
additional 5% to compensate for the absence of rotation. This additional amount was 
reduced  to  3% for  the  United  Kingdom  and  Denmark.  On  the  basis  of  these 
provisions and the forecasts for cereal production and outlets up to 2000, a uniform 
basic  rate of  set-aside  equal  to the present basic rates should be  fixed.  Since  the 
beginning  of  the  reform,  producers have tended to move from rotational  to  non-
rotational set-aside despite the additional set-aside required, and by 1995 more than 
half of  set-aside in the Community was non-rotational.  Given this situation, and in 
order to obtain the same effect with a uniform rate as with the differentiated  rates, 
the Commission proposes to fix the uniform basic rate of set-aside at 18%. 

As regards the rate of set-aside to apply for the  1997/98 marketing year, i.e. to the 
autumn  1996 and spring 1997 sowings, the Commission will, if necessary,  make a 
specific proposal in July  1996, taking account, inter alia, of the forecast for the 1996 
Community  harvest and market developments. 

In order to ensure consistency, given that the rate of compulsory  set-aside will  be 
the same for all Member States, the additional rate in the event of transfers of set-
aside between farmers should be fixed at 3%. 

Cereals 

Prices and compensatory  payments 

In  1995/96,  the final phase of  the reduction  of  intervention  prices,  the  definitive 
arrangements adopted under the reform were introduced. From that marketing year, 
the  intervention  price  and  the  compensatory  payments  decided  in  1992  remain 
applicable for the subsequent marketing years. The uniform intervention price for 
all cereals is ECU  119.19 per tonne and the compensatory payment ECU 54.34 per 
tonne per hectare of historical  cereal yield as fixed in the regionalization plan. 

Vol  I E N-  11 

2.2 

Monthly  increases 

The intervention price for cereals is increased on a monthly basis from November 
to  May  by  a  sum  amounting  to  ECU  1.3  per  tonne  per  month  for  the  1995/96 
marketing year. The increase for May also applies in June. 

The Commission proposes to maintain these arrangements,  changing just the level 
of the monthly increase. 

The reductions in the monthly increases proposed by the Commission in the price 
packages  since the beginning of the reform  have not been accepted in full  by the 
Council. The consequences have been felt on the markets, where there has been too 
marked a tendency to hold cereals at the beginning of the marketing year in order 
to  market them  later.  The  monthly  increases  should  therefore  be  reduced  to  the 
optimum  level  required  to  ensure  smooth  disposal  of  the  harvest throughout  the 
marketing year. Furthermore, interest rates are falling and this is likely to continue 
in  the  medium  term.  For  all  these  reasons,  the  Commission  proposes  to  fix  the 
monthly  increase at ECU  1.10  per tonne per month. 

3. 

Protein  crops and  linseed 

* The  Annex  I  attached  to  this  Explanatory  Memorandum  constitutes  the  report 
requested by the Council.  It shows that a change in the system of payment of the 
aid for those crops would not improve the balance between arable crops. 

4. 

4.1 

4.2 

Grain  legumes 

The scheme for grain legumes was introduced in 1989 by Council Regulation (EEC) 
N*  762/89  in  order to  maintain  these  crops  having  an economic  interest  for  the 
European Community.  It expires at the end of the  1995/1996 marketing year. 

When it adopted the Regulation which implemented the "Blair House" agreement 
on oilseeds in December  1993, the Council made the following  declaration: "  The 
Council approves the Commission's intention progressively to strengthen the present 
support arrangements for producers of crops such as lentils, chick peas and vetches 
in  order  to  achieve  the  objective  of  medium-term  cultivation  of  an  additional 
280,000  hectares  of  such  products  in  Spain.  For  each  year  during  which  that 
objective  is achieved the level  of  aid will  be reduced by the percentage by which 
the objective  is  exceeded".  It thus signalled  its wish to continue to support these 
products and even to provide for a certain increase in the area cultivated in order 
to provide an alternative to sunflower seed cultivation, particularly in those parts of 
the Union where these crops are a traditional part of the arable area. 

Vol  I EN  -  12 

4.3 

4.4 

Therefore,  the  Commission  proposes  an  adapted  scheme  which  retains  the  main 
elements  of  the current scheme  ( Maximum  Guaranteed Area (MGA)  and hectare 
aid) ,  which puts the regulation for these crops more in line with  some  aspects  of 
the regime for arable crops (adaptation  of the aid in the current marketing year in 
cases where the MGA is exceeded) and which takes account of the December  1993 
compromise.  The  Commission  executed  the  aid  element  of  that  compromise  by 
increasing the aid to  157 Ecu/ha in  1994/1995  and to  181 Ecu/ha  in  1995/1996. 

Therefore,  the  Commission  proposes  to  increase  the Maximum  Guaranteed  Area 
(MGA) to 400,000 ha and to fix the aid at the current level of  181 Ecu per hectare. 
An  overshoot  of  the  MGA  in  one  marketing  year  gives  rise  to  a  proportional 
reduction of the aid during the same marketing year. 

5. 

Rice 

5.1 

Prices 

The intervention prices for paddy rice for the 1996/97 to 1999/2000 marketing years 
were  fixed  by the Council  Regulation  on the reform  of the COM  The price  was 
fixed  at  ECU 351  per  tonne  for  the  1996/97  marketing  year.  A  15% reduction 
spread over three years will bring the price for 1999/2000 to ECU 298.35 per tonne. 

5.2 

Monthly  increases 

From the 1996/97 marketing year, the intervention period is from 1 April to 31 July. 
During that period, the intervention price is subject to four monthly increases, the 
increase for July also being applied in August. 

In view of the movement of interest rates, it is proposed to fix the monthly increase 
at ECU 2.06  per tonne. 

6. 

Sugar 

6.1. 

The  Commission  proposes  to  maintain  unchanged  the  basic  price  for  beet,  the 
intervention price for white  sugar and the manufacturing margin. 

This proposal  relates to the basic price for beet and to the minimum  prices for  A 
beet  and  B  beet,  which  depend  ultimately  on  the  ceiling  fixed  for  the  basic 
production levy and for the B levy, the latter subject to a subsequent increase in the 
ceiling in accordance with Article 28  of Regulation (EEC) No  1785/81. 

6.2. 

As far as the reimbursement of storage costs is concerned, the Commission proposes 
that the amount of the monthly  refund be reduced from ECU 0,45/100  kg to ECU 
0,41/100 kg, to take account of the lower interest rates prevailing in the Community. 

Vol  I EN  -  13 

1996/97  PRICE PROPOSALS  FOR SUGAR 

lJBasic price for beet 
2.Minimum price for A beet (1) 
3 .Minimum price for beet (2) 
4 intervention price for white sugar 
5 .Target price for white sugar 
6 intervention price for raw sugar 
7 .Monthly reimbursement of storage costs 

Unit 

tonne 
tonne 
tonne 
100 kg 
100 kg 
100 kg 
100 kg 

1995/96 
prices 
(ECU) 

1996/97 
proposal 
(ECU) 

47,67 
46,72 
32,42 
63,19 
66,50 
52,37 
0,45 

47,67 
46,72 
32,42 
63,19 
66,50 
52,37 
0,41 

Change 

% 

0 
0 
0 
0 
0 
0 
- 8 ,9 

(1) 
(2) 

98% of the basic price for beet 
68% of the basic price for beet, except where Article 28(5) of Regulation (EEC) No 
1785/81  is applied. 

7.  Olive OU 

7.1 

Prices  1996/97 

The Commission intends to propose in the near future a major reform of the regime. 
However,  in  view  of  the  uncertainty  over  the  timing  of  the  proposals  and  over 
whether the Council can decide on the revised regime in time for it to apply to the 
1996/97  marketing year,  as a precautionary  measure,  the continuance of  existing 
prices and aid levels is proposed. 

Following  this  approach,  the  prices  and  aid  levels  proposed  for  the  1996/97 
marketing year are detailed in the table.  In this table 1994/95  and 1995/96 figures 
are also given for comparative purposes. 

Related  measures : 

7.2 

The fluctuating production levels specific to this product may result occasionally in 
a shortage  on the market and very  high prices.  In order to be  able to respond to 
such  a  situation  by  increasing  the  level  of  imports,  it  is  proposed  to  give  the 
Commission the power to suspend partially or totally the Common Customs Tariff 
when the market price of olive oil is significantly higher than the intervention price. 

Vol  I EN -  14 

7.3 

Certain  minor adaptations  to the  consumption  aid  regime  resulting  also  from  the 
implementation of the Uruguay Round agreements are, in addition, proposed.  They 
include  in  particular the  suppression  of  the  requirement  that olive  oil  benefitting 
from the  aid  should  be  produced  in  the  Community,  and  of  the  obligation  for 
importers of olive oil  (with the exception of olive oil imported from Tunisia under 
the quota benefitting from special  arrangements) to constitute a guarantee equal to 
the amount of the consumption  aid payable on the quantity imported. 

These  adaptations  are  a  consequence  of  the  inclusion  in  the  Common  Customs 
Tariff of an amount equal to that of  the guarantee to be constituted.  They should 
come into force not later than  1 July  1996 when the transitional  measures adopted 
under Council Regulation (EC) No  3290/94 will  expire. 

Price proposals for olive oil 

TYPE OF PRICES OR AID 

1994/95 

1995/96 

1.  Production target price 

383, 77 

383, 77 

Vol I EN - 15 

Ecu/100 kg 

1996/97 

383, 77 

2.  Intervention price 

191, 92 

186, 17 

186, 17 

3.  Representative market price 

229, 50 

229,50 

229, 50 

4.  Production aid 

142,20 

142, 20 

142, 20 

5.  Production aid for olive growers 
whose average production is less 
than 500 kg 

151, 48 

151, 48 

151, 48 

6.  Consumption aid 

12,07 

-

12,07 

12,07 

7.  Percentage withheld on the 

production aid for : 

-  quality improvement 
-  aid for producers organizations 

and associations thereof 

8.  Percentage withheld on the 

consumption aid : 

1, 40% 
0, 80% 

1, 40% 
0, 80% 

1, 40% 
0, 80% 

-  promotion campaigns 
-  aid for trade bodies 

0  % 
5,50% 

0  % 
5, 50% 

0  % 
5, 50% 

Vol  I EN  -  16 

8. 

Fibre  plants 

Cotton 

8.1  The cotton regime was reformed last year and so no major changes are proposed  : the 
prices,  the  National  Guaranteed  Quantity  for  each  Member  State  and,  thus,  the 
Maximum  Guaranteed Quantity were all fixed for a five years period. 

8.2  However,  establishing the level  of the advance at the beginning of the marketing year 
1995/96 required the exercise of cautious judgement both as to the level  of production 
and as to world prices. This was in order to ensure that the advance would not exceed 
the  total  payment  To  avoid  having  to  forecast  both  these  unknown  factors,  the 
Commission proposes to amend the basic Council  regulation in order to provide for a 
variable  amount of  advance.  This  advance will  be based  on the difference  between  a 
provisional  estimate  of  the  target  price  and  the  observed  daily  world  price.  The 
provisional  estimate of  the target price will  correspond to the target price reduced by 
a provisional  abatement  This will  result from any application of the MGQ stabilizers 
which  production  forecasts  indicate  will  be  necessary.  However,  such  production 
forecasts shall for these purposes be inflated by  15% in order to provide a safety margin 
to  ensure  that  aid  advance  payments  do  not  exceed  final  aid  payments.  The  final 
payment, to be made as soon as final production figures are available, will thus become 
a  flat  raté  sum  equal  to  the  difference  between  the  provisional  abatement  and  its 
definitive  level.  Moreover,  the  current  system  under which  the  aid  can  be  prefixed 
created distortion of competition between operators. For this reason, and to simplify the 
management of the regime, the Commission proposes to provide that the demand for aid 
must be lodged on the same day as the cotton is placed in supervised storage. 

Fibre flax 

8.3  Fibre  flax  is  supported by  an aid per hectare,  part of  which  is  retained to finance a 

linen promotion scheme. 
After  several years of important market surpluses, the flax market has been reasonably 
well  balanced in recent years, but is now expected to move again into surplus. 
For  some  time  now  the  Commission  has  been  warning  in  price  packages  that,  after 
watching the development of this crop carefully, there may be a need to propose some 
means of limiting the planted area, e.g.  a maximum guaranteed area. 
Because  of the desirability  of  more stability in the flax  market and in the areas sown, 
a  regime  providing  for  a  Community  maximum  guaranteed  area  (MGA)  based  on 
average  areas  cultivated  over  the  last  three  years  (81,500  ha)  is  proposed,  from  the 
1997/98  marketing year onwards.  In case  of  overshoot,  a reduction in the aid for the 
marketing year concerned (1% for an overrun of each 1% of the MGA) will apply. The 
decision  should  be taken now,  so  that producers  can take  account  of this new  policy 
instrument in planning their investment for next year. 

8.4  The  planted  area has been  expanding  in recent years more in new  growing  areas  (in 
particular Spain and the UK) than in traditional areas (in particular France, Belgium, the 
Netherlands). 

Vol  I E N-  17 

In the new  areas the growing  techniques  are more concentrated  on the yield  of  seed, 
whilst the yield and quality of the fibre is lower, mainly because the crop is harvested 
by cutting the plants rather than by grubbing them (pulling),  and also because the  flax 
is sown at a lower density. The more traditional and intensive way of growing leads to 
higher production costs with investments in specialised harvesters and scutching plant. 

In  order  to  avoid  the  effect  of  the  MGA  bearing  disproportionately  on  producers 
practising traditional production techniques, it is proposed to introduce from the 1997/98 
marketing year on an aid abatement to be applied to the aid paid to those producers who 
harvest their crops by cutting rather than grubbing up (pulling) their crops. The level  of 
the abatement, to be set by the Commission under management committee procedure, 
will  take  account  of  the different  variable  costs involved  in  the two  systems  and the 
difference in the value of the output as well  as the need to avoid encouraging the non-
traditional  producers to invest  also  in the traditional  intensive  production  techniques, 
which  would  increase  the  production  of  flax  fibres  and  with  it  the  risk  of  market 
disequilibrium. This new abatement would replace the existing abatements linked to the 
yields  of  seed,  which  seem  to  be  no  longer justified  taking  into  account  the  new 
harvesting (retting) techniques used in the traditional areas. This would simplify  on the 
spot controls by the Member States after harvest 

8.5  The new system will be reviewed after three years experience, in particular to verify that 
the objective of improving control over the planted area whilst maintaining a reasonable 
balance between traditional and less intensive production techniques has been achieved. 

8.6  For the  1996/97  marketing year the Commission  proposes to maintain the current aid 
level and the current amount retained to finance promotion actions at 935.65 Ecu (before 
any aid abatement) and 53.64 Ecu per hectare respectively. 

8.7 

Hemp 
In view  of  the current and foreseeable  market situation for hemp and the level  of aid 
proposed for fibre flax,  the Commission considers that the areas sown with hemp can 
be kept around their current level  by keeping the aid for  1996/97 at 774.74 Ecus/ha. 

Silkworms 

8.8  Silkworm rearing is practised in a few  areas of the Community only and benefits from 
a flat  rate aid  per box.  Taking  into  account the benefits  for  some  rearers from large 
devaluations of their national  currency the Commission proposes to set the amount of 
aid at the same level  as last year, i.e.  Ecu  133,26. 

Vol  I E N-  18 

9.  Wine 

9.1  Since May  1994 the  Commission  has presented to the Council  and to Parliament  the 
proposal  on the reform  of the common organization of the market in wine in order to 
fix  new  rules  for  that  sector.  Among  other things,  the  proposed  measures  make  the 
fixing  of  guide  prices  superfluous.  It  may  not,  therefore,  be  necessary  to  make  a 
proposal  within  the  price  package.  However,  since  the  Council  may  not  adopt  the 
proposed measures as they stand and may, moreover, not be able to decide in time for 
the application of the reform to the 1996/97 marketing year, it seems sensible to extend 
various legal provisions of the existing wine regime in order to ensure that, if necessary, 
it can continue to function  as at present. 

9.2  The  Commission  therefore  proposes  extending  the  guide  prices  for  the  1995/96 

marketing year into the  1996/97 marketing year. 

9.3  Pending  the  establishment  of  the  new  Common  Market  Organisation  in  wine,  it  is 
proposed  to  extend  for  the  1996/97  marketing year  certain  deadlines  established  by 
Community legislation concerning the submission of the reports on the sulphur dioxide 
(S02)  content of wines,  sparkling wines and liqueur wines. 

As regards other reports: 

- 

- 

the report on measures enabling producer groups to be included with producers for 
compulsory distillation contracts. The postponement of this deadline, which concerns 
Regulation (EEC) No 2046/89, will be studied in the context of a separate proposal 
dealing with amendments to this regulation. 

the link between structural measures and compulsory distillation will no longer have 
any  significance  if  the  administrative  guidelines  provided  for  by  the  reform  are 
adopted. It is therefore proposed that the obligation to produce this report be deleted; 

-  as to the reports on  "enrichment" and the delimitation  of wine-growing areas, the 
presentation of the discussion paper and the reform proposal render them redundant 
since  conclusions  on those  subjects have already been  drawn by the  Commission. 
The studies used by the Commission to draw up its proposal are now available and 
have been provided to the Council. 

It is also proposed to extend certain deadlines for market management, in particular: 

- 

the  rules  for  calculating  the  quantities  to  be  distilled  for  each  production  region 
(uniform  percentage  and  reference  wine  year)  accepted  following  the  Dublin 
compromise, which were deferred until  31 August  1996, as well  as the derogation 
granted for a particular application of the compulsory distillation system in Greece; 

Vol  I EN -  19 

- 

- 

the trial periods for certain deacidification  practices which are reaching their expiry 
date; 

the period during which it  is permitted to reserve for the promotion of grape juice 
part of the aid granted for the use of grape must to make grape juice, the deadline 
of which was already extended last year until 31  August  1996. 

9.4  With regard to  Spain's problems concerning the possibility  of mixing white wine and 
red wine (Mezcla) and marketing wines with a degree of acidity lower than that fixed 
for the rest of the Community, it is proposed to extend for the next marketing year the 
measures already adopted under the last price package and similarly to provide for the 
same derogation on acidity in Portugal  as has been granted in the past. 

9.5  The rules currently in force concerning the ban on new planting and the system granting 
Community  premiums  for  grubbing  up  vines  are  due  to  expire  in  the  course  of  the 
current  marketing  year.  It  is  proposed,  pending  a  decision  on  the  set  of  measures 
proposed under the reform, to extend the system in force for a new year. 

9.6  It  is  also  proposed  to.provide  for  a  specific  derogation  for  certain  special  wines( 
obtained from botrytis  grapes)  in  the United  Kingdom  as regards the  maximum  S02 
content.  For this precise  category  of  wine  the  maximum  content  should  be  raised  to 
300 mg/1 (the same as that provided for analogous products in other regions). 

It should be noted that: 

-  with regard to the extension of the deadline for the restructuring of vines planted in 
"hybrid" varieties in Madeira and the Azores, the Commission will be submitting to 
the Council the appropriate proposal as part of the amendment it will be submitting 
of Regulation (EEC) No  1600/92 concerning specific  measures for the Azores and 
Madeira relating to certain agricultural products; 

- 

the amendments to the general distillation rules concerning the proportional relation 
between infringements  and penalties will  be submitted as soon as possible. 

9.7  The vineyard register 

Without prejudging the  outcome  of the  discussions under way  in the Council  on the 
reform  of  the  common  organization  of  the  market  in  wine,  the  future  management 
arrangements for the COM will  probably involve a register permitting the area planted 
with vines to be known. 

Given the state of the work for the establishment  of vineyard registers in the Member 
States concerned and in the light of experience, the Commission proposes to extend the 
deadline for the completion of  the simplified vineyard register (basic reference charts) 
to 31 December  1998 instead  of 31 December  1996 as was decided at the time of the 
adoption of the price package last year. 

Vol I EN - 20 

10.  Fruit and Vegetables 

Basic and buving-in prices 

Pursuant to Article  16 of Council Regulation (EEC) No 1035/72 on the common organization 
of the market in fruit and vegetables, each year the Commission proposes a basic price and 
a  buying-in  price  for  each  of  the  products  listed  in  Annex II  to  that  Regulation,  i.e. 
cauliflowers, apricots, nectarines, peaches, lemons, tomatoes, aubergines, pears, table grapes, 
apples, satsumas, mandarins, clémentines and oranges. 

Pending  a  decision from the  Council  on  the  reform  of  the  common  organizations  of  the 
markets in fresh and in processed fruit and vegetables, the Commission proposes to maintain 
the basic prices and buying-in prices at their current levels. It will draw conclusions from any 
overruns  of  the  intervention  thresholds  when  the  total  withdrawals  during  the  1995/96 
marketing year are known. 

11.  Milk and milk products 

11.1. 

11.2. 

11.3. 

The current .situation on the market for milk products seems fairly balanced and does 
not, therefore, require corrective action this year on prices or quota levels. It should, 
however, be underlined that market stability is still fragile and cloaks a structural 
surplus which consistently requires large-scale intervention in the form of subsidized 
end-uses. Furthermore,  the progressive  application  of  GATT obligations will  put 
increasing pressure on the sector. 

Since  1992, as part  of the  CAP  reform  and linked  with the reduction  in  cereals 
prices,  the  Council fixed the  target  price  and  the  intervention  prices  for  periods 
which run from 1 July to 30 June. It seems appropriate to continue this practice and, 
for the sake of consistency, the Commission also proposes to bring the start of the 
marketing year in line with the period for which prices are  fixed. 

In the framework  of the Uruguay Round negotiations, certain bilateral agreements 
were concluded which foresee  arrangements under which the Union would have a 
more active role in the management of concessions granted by third countries. With 
regard  to  measures  to  ensure  that  maximum  advantage  can  be  taken  of  such 
arrangements, experience has shown that the Commission lacks an adequate legal 
basis  to  enable  it  to  undertake  simply  and  efficiently  the  management  of  these 
concessions. The Commission, therefore,  proposes to insert an ad hoc provision in 
the basic Regulation to remedy this  difficulty. 

Vol I EN - 21 

12.  Beef and veal 

12.1  Prices 

As regards the intervention price, it is proposed to maintain the level of 347,5 Ecu/100 
kg deadweight for male carcases of quality R3. 

No other prices are required to be fixed since the obligation to fix yeariy a guide price 
was removed by the Council (Uruguay Round Agreement). 

Concerning  the  period  covered  by  the  marketing  year,  it  is  proposed  to  amend  the 
normal  dates  so that  it  would  commence  on  1 July  from  1996  onwards;  the  next 
marketing  year would  therefore  begin  on  1.7.1996 and  end  on 30.6.1997  instead  of 
1.4.1996 and 30.3.1997 according to the existing rules (Article 4 of Council Regulation 
805/68). 

12.2 Premia  (related measures^ 

Following the reform of the Common Agricultural Policy (CAP) in the beef sector, the 
Commission undertook to examine the functioning  of certain measures introduced by 
the  new  beef  premium  regime.  In  Annex II  to  this  Explanatory  Memorandum  is 
attached a document entitled "Report on the Beef and Sheep Sectors" which studies the 
following  questions : 

- 

- 

- 

the distribution of the regional ceilings for the Special Male Bovine Premium in 
the  Member  States  in  the  light  of  the  evolution  in  structures  of  production 
following the reform, 
the effects  of the deseasonalisation premium, 
the  application, in  the territories  of  the new  German Lander, of the provisions 
applicable in the rest of the Community, and 
the  beef  market  situation  in  the  light  of  the  evolution  of  the  sector  and  the 
application of the GATT agreement 

As a consequence of this examination it is proposed : 

a) 

b) 

to  delete  the  second  age  bracket  premium  for  non-castrated  male  bovines 
whilst increasing by 14% the amount of the single premium which results for 
this type  of  animal.  This percentage increase in the single premium  arises 
from  me savings made by the deletion  of  the  second  age bracket  premium 
payment and thus has a neutral budgetary  effect; 
to  maintain  the  deseasonalisation  premium  with  seasonal  slaughtering 
coefficient  slightly  lower  than  at  present,  but  calculating  this  coefficient 
considering the total number of steers slaughtered in the Republic of Ireland 
and in Northern Ireland (the two principal beneficiaries of this measure).  Also, 
a  possibility  of  providing  an  alternative  incentive  to  orderly  marketing, 
financed  by  a  deduction  from  the  second  tranche  of  the  steer  premium  is 

Vol I EN - 22 

c) 

proposed,  for  application  when  the  criterion  for  the  application  of  the 
deseasonalisation premium is no longer  fulfilled; 
Finally,  not  to  accept  requests  made  by  Germany  in  respect  of  the  New 
Lander  : -
(1)  For  the  prolongation  of  certain  derogations  from  the  rules  on  the 
application of the suckler cow premum; 
(2) For the waiving of the 90 head limit on the male animal premium. 

13.  Sheepmeat and goatmeat 

13.1 Prices 

The institutional  prices for  the  1996 marketing year were fixed in the  1995/96 prices 
package. 
For  1997 the  Commission  proposes  that  the basic  price  remains  at  the  level  already 
decided for  1996. The Commission  also proposes that the seasonalisation  of the basic 
price remains unchanged. 

13.2 Related measures : Speeding up the opening of the private storage procedure 

At present in this sector, the amount of aid granted for private storage may be fixed for 
a  certain  quotation  zone  (by  Management  Committee  procedure)  either  by  tendering 
procedure or by fixing in advance the amount of aid at a flat rate. However, if the market 
price (in the Community or in the quotation zone in  question) falls below 70% of the 
basic price, which tends to become the rule, the procedure of fixing the amount of aid 
for private storage by way of tender becomes the only procedure authorised. 

In the course of the 1995 marketing year, the Commission has been faced with particular 
requests for private storage intended to relieve rapidly the market during certain periods 
of the year which had become undeniably difficult  (e.g. in Ireland, Sweden and Finland). 
Subsequently,  with  the  procedure  of  tendering  being  the  only  authorised  method,  a 
relatively  effective  intervention  in  the  market  is  allowed  but  it  takes  place  with  a 
considerable delay: firstly, with a Management Committee to call for  offers;  secondly, 
with a Management Committee to fix the minimum level of aid. With the aim of making 
the private  storage procedure  more  effective,  in the  event that  a  swift  intervention  is 
required  (sudden  market  price fall  iu  a certain  quotation  zone or  agreement from the 
Commission for a defined but limited operation), the Commission proposes to modify the 
basic regulation by establishing the possibility to foresee  at any market price level the 
need for private storage by means of the procedure which fixes in advance the amount 
of the aid (the procedure by tender remaining, however, the rule to follow in the majority 
of cases). Under these conditions, a single Management Committee could, if necessary, 
vote without unnecessary delay on the amount of aid judged to be adequate and on the 
maximum, acceptable quantity to be put into storage within a certain deadline. 

13.3  As  concluded  in  the  report  attached  as  Annex  H,  an  extension  of  the  derogation 
granted to the new German Lander as regards the application of the limit of the ewe 
premia is proposed. 

Vol  I EN  -  23 

14.  Pigmeat 

14.1  The basic Regulation for pigmeat provides for the fixing of a basic price. Its level  is 
primarily meant to indicate the level  of prices at which the market will be in balance, 
i.e. which  contributes towards stabilizing market prices without,  however,  leading to 
structural  surpluses.  The only  operational  purpose  of  the basic price is to  provide a 
trigger  for  possible  private  storage  aid.  Such  a  scheme  may  be  initiated  when  the 
average  market price  in the  Community  falls  below  103 % of  the basic  price.  The 
basic price is in force from 1 July to 30 June. 

14.2  For the  period July  1995  to  June  1996  the basic  price for  pig  carcases  of  standard 

quality was fixed at  1509.39  ECU/t 

14.3  After two consecutive reductions in  1994/1995  and 1995/1996, the basic price stands 
now  at  a  level  which  represents  a  reasonable  estimate  of  the  point  of  equilibrium 
between  supply  and  demand.  Therefore,  it  is  proposed  to  keep  the  basic  price 
unchanged and to fix it at  1509.39 ECU/t 

14.4  The standard quality, to which the basic price refers, was changed in 1995/1996, from 
class U  to class E. Class E represents the quality of the majority of pigs slaughtered 
in the Community and should be kept unchanged. 

The definition  of standard quality  should be fixed as follows : 

(a) carcases weighing 60 kg to less than  120 kg : grade E; 

(b) carcases weighing  120 kg to  180 kg  : grade  R 

15. 

Tobacco 

15.1  The Common Market Organization as reformed in  1992 is now well  established. 

15.2  With  respect  to  the  fixing  of  the  guarantee  thresholds,  the  Council  requested  the 
Commission  to present its proposals at an early stage,  prior to the price package,  so 
as to allow tobacco producers to know their rights in advance of the planting season. 
Accordingly,  the  proposal  regarding  the  1996  and  1997  harvests  is  now  before  the 
Council,  and the  decision  is  expected  before  the  end  of  February.  This  proposal  is 
essentially  a roll-forward  of the  1995 situation. 

Vol  I EN -  24 

15.3  With regard  to the  premia.  the  experience  of the  3  last  campaigns  shows that their 
present level should be maintained also for  1996/97. In fact, production has been close 
to the guarantee thresholds, with minor exceptions due to the market situation, and in 
particular to the reduced demand for some varieties. 

15.4 

It  should  be  noted  that  the  Commission  will  also  present  before  1.4.96  a  set  of 
proposals regarding the future of the tobacco regime.  These proposals  concern only 
the  1998  harvests  and  beyond.  Therefore  it  seems  logical  that  its  discussion  be 
separated from the price fixing. 

Vol  I EN -  25 

ANNEX I 

Report  on the examination  of  the  protein  plant  and  non-fibre  flax  sectors 

In its conclusions  of 22 June  1995  on the  1995/96  price package, the Council  asked for an 
examination  to  be  made  of  whether  the  application  of  Article  15(2)  of  Regulation  (EEC) 
No  1765/92  (oilseed  arrangements)  in  the  protein  plant  and  non-fibre  flax  sectors  would 
preserve the balance between arable crops. 

1. Protein plants (peas, field beans and sweet lupins) 

7.7  Community production 

The  largest  area  sown  before  the  reform  was  1 327 000 ha  in  1987.  With  the 
introduction of a maximum guaranteed quantity in 1988, the area stabilized at between 
1.2 and  1.3  million hectares. A new high was recorded in  1993, the first year of the 
,  reform  of  the  CAP,  when  1 373  000 ha  were  sown.  In  1995,  the  area  for  the 

Community of Twelve fell  to  1 142 000 ha. 

In the three main  "traditional" producer  countries, France, the United Kingdom and 
Denmark, areas developed in parallel. Areas increased in Germany, particularly in the 
new Lander, and in Spain. The area in Italy has been falling since 1986 and was down 
to 39 000 ha in 1995. 

Yields increased satisfactorily  until the beginning of the  1990s as a result of genetic 
improvements and improved cultivation techniques, but also of a gradual move from 
field beans to peas and a concentration of sowing in France, where yields are highest. 
In 1994 and  1995, yields tended to fall  as a consequence of the reduction of areas in 
the "traditional" producer Member  States and an increase in Spain, where yields are 
only  around  lt/ha. 

The result of these developments was that Community production tended to increase 
up until  1993 and then began to fall in  1994 and 1995. In other words, after a period 
of  intensification,  specialization  and  concentration  in  the  most  productive  regions 
between 1988 and 1993, production has begun to move to the less productive regions. 

Table  1 gives the details of the development  of Community production. 

Protein crops 

PEAS, FIELD BEANS AND SWEET LUPINS : AREA SOWN (000 ha) 

D11 
63 
102 
89 
68 
46 
36 
30 

D11 
3,60 
3,26 
3,60 
3,50 
3,59 
3,69 
3,63 

D11 
227 
333 
320 
238 
165 
133 
109 

1986/87 
1987/88 
1988/89 
1989/90 
1990/91 
1991/92 
1992/93 
1993/94 
1994/95 
1995/96(e) 

1986/87 
1987/88 
1988/89 
1989/90 
1990/91 
1991/92 
1992/93 
1993/94 
1994/95 
1995/96(e) 

1986/87 
1987/88 
1988/89 
1989/90 
1990/91 
1991/92 
1992/93 
1993/94 
1994/95 
1995/96(e) 

D16 

64 
48 
47 
89 
76 
120 

D16 

3,34 
3,40 
2,94 
3,26 
3,20 
3,20 

D16 

214 
163 
138 
290 
242 
383 

DK 
142 
201 
147 
123 
115 
99 
118 
121 
106 
76 

FRA 
313 
474 
548 
656 
715 
667 
715 
753 
679 
581 

UK 
152 
211 
261 
214 
216 
203 
208 
244 
229 
191 

ESP 
69 
65 
50 
52 
42 
34 
30 
30 
114 
116 

ITA 
173 
164 
119 
119 
113 
114 
103 
93 
80 
39 

other 
59 
110 
80 
57 
26 
22 
37 
43 
21 
19 

PEAS, FIELD BEANS AND SWEET LUP 

DK 
3,62 
2,62 
3,45 
3,86 
4,79 
4,21 
2,58 
3,77 
3,60 
3,61 

FRA 
3,82 
4,06 
4,76 
4,47 
5,15 
4,79 
4,61 
5,06 
5,06 
4,79 

UK 
3,82 
2,70 
3,67 
3,40 
3,76 
3,43 
3,39 
3,87 
3.17 
2,93 

ESP 
0,84 
0,98 
1,18 
1,15 
1,21 
1,41 
1,27 
1,00 
0,95 
0,57 

NS : YIELDS (t/ha) 
other 
3,22 
2,31 
2,74 
2,70 
2,73 
1,59 
2,23 
2,61 
3.71 
2,83 

ITA 
1,31 
1,38 
1,26 
1.25 
1,32 
1,83 
1,78 
1,57 
1,64 
1,63 

PEAS, FIELD BEANS AND SWEET LUPINS : PRODUCTION (0001) 

DK 
514 
527 
507 
475 
551 
417 
305 
456 
380 
274 

FRA 
1196 
1925 
2608 
2931 
3681 
3198 
3293 
3811 
3433 
2784 

UK 
580 
57U 
959 
727 
812 
697 
706 
944 
724 
560 

ESP 
58 
64 
59 
60 
51 
48 
38 
30 
108 
66 

ITA 
226 
227 
150 
149 
149 
209 
183 
146 
131 
64 

other 
190 
254 
219 
154 
71 
35 
83 
112 
77 
53 

EUR-12 
971 
1327 
1294 
1289 
1291 
1187 

EUR-12 
3,08 
2,94 
3,73 
3,67 
4,28 
4,02 

EUR-12 
2991 
3900 
4822 
4734 
5529 
4767 
4716 

EUR-12+ 

EUR-15 

1309 
1199 
1257 
1373 
1304 
1142 

1329 
1436 
1360 
1183 

EUR-12+ 

EUR-15 

4,26 
4,00 
3,78 
4,22 
3,91 
3,66 

3,63 

EUR-12+ 

EUR-15 

5578 
4797 
4746 
5789 
5095 
4184 

4301 

14/02/96 

< 
o 
ffl 

to 

Vol  I EN - 27 

1.2 Protein  crops and the reform of the CAP 

The  aid  scheme  for  protein  crops  was  introduced  into  the  arrangements  for  arable 
crops in 1992. The aid per hectare for protein crops is ECU 78.49 per tonne multiplied 
by the reference regional cereal yield. This level of aid was introduced in the first year 
of application of the reform  at the same time as the support prices were abolished. 

It should be recalled that the intervention price for cereals has been reduced in three 
stages and that the aid has been adjusted accordingly from ECU 30.19 to ECU 42.26 
to ECU 54.34 per tonne of historical yield. 

As a result of the different transitional arrangements for protein crops and cereals, the 
first transitional  year,  1993/94,  was particularly  favourable  for  protein crops which 
immediately benefited from their final level of aid. On the other hand, it was foreseen 
that, when  the  arrangements were  fully  in  force,  protein  crops would  lose  some  of 
their attractiveness compared with that first transitional year, the level  of aid having 
been calculated to more or less equalize income from the two types of crop at the end 
of the transitional period. 

This is confirmed by a comparison in two production zones (a department of France 
and East Anglia) of the profitability  of protein crops and cereals: 

-  before the reform, protein crops were slightly more profitable than cereals; 

-  during 1993/94, total income decreased for cereals and increased for protein crops, 

increasing the profitability  gap in favour of protein crops; 

-  in  1994/95, the situation changed and cereals became slightly more profitable than 
protein crops, the market price for the latter falling more than that for the former, 

-  in  1995/96, income from the two crops has increased because of their high market 
price,  although  protein  crops  remain  less  profitable.  The  income  differential  has 
increased in  1995/96, in a way that could not be foreseen at the time of sowing, as 
a  consequence  of the firmness of  cereal  prices.  This is  a temporary  phenomenon 
arising from market conditions in  1995/96. 

Vol  I EN -  28 

Furthermore,  as  can  be  seen  in  the  following  table,  the  Community  area  sown  in 
1995/96 is higher than that normally sown, which can be defined  as the average area 
sown before the reform  (1  265  000 ha for  1988-91) less the set-aside. 

Set-aside  (%) 

Threshold (ha) 

Area sown 

Gap (%) 

1993/94 

1994/95 

1995/% 

15 

15 

12 

1075 000 

1075 000 

1 113 000 

1373 000 

1304 000 

1  142 000 

+28 

+21 

+2.6 

1.3  Conclusion 

When  account  is  taken  of  the  normal  effects  of  set-aside  and  a  certain  degree  of 
extensification,  the recent reduction in the Community  area sown with protein crops 
is no cause for alarm. The reduction is certainly aggravated by certain cyclical factors, 
the high price for cereals being the most important The Commission is convinced that 
a satisfactory balance can be maintained between arable crops in the context of market 
prices for feed-grain  closer to the intervention price. It therefore takes the view that 
the existing arrangements for protein crops should not be amended. The Commission 
will, however, continue to monitor the future development of the area sown to protein 
crops and will  make appropriate proposals if this appears to be warranted. 

2. Non-fibre  flax 

2.7  Community production 

In the mid-1970s, the Community  area sown with non-fibre  flax totalled 30  000 ha. 
It then fell to 5 000 ha to rise at the end of the 1980s and the beginning of the  1990s 
to  265 000 ha.  The  area (EUR-12)  for  the  1995/96  marketing  year  is  estimated  at 
120 693 ha. 

The  average  yield  is  1.7  t/ha,  but this  can fluctuate  widely from year  to  year  and 
region to region. 

The world price for seed flax is unstable: ECU 380/t in 1984, ECU  130/t in  1992 and 
ECU 200-210/t in  1994 and 1995. 

Vol  I EN -  29 

2.2 Non-fibre flax  and the reform of the CAP 

Community  rules on non-fibre flax initially  provided  for  aid equal  to the  difference 
between  the  target  price  set  by  the  Council  and  the  average  world  market  price 
recorded by the Commission. In 1993, a maximum guaranteed area of 266  000 ha was 
introduced. 

From  1994/95,  non-fibre  flax  was  fully  integrated  into  the  arrangements  for  arable 
crops. The compensatory aid per hectare is ECU  105.1/t multiplied by the cereal yield 
referred  to  in  the  regionalization  plan.  The  base  area  for  arable  crops  has  been 
increased by 63  000 ha (average area sown with non-fibre flax during 1989,  1990 and 
1991). In addition, where it fulfils the conditions, the crop can benefit from the "seed" 
aid, set at ECU 224.6/t. 

2.3 Conclusion 

An  examination  of  the  profitability  of  non-fibre  flax  shows  that  there  are  no 
profitability  problems  compared  with  other  arable  crops,  in  particular  rape.  The 
Commission  therefore  takes  the  view  that  it  is  not  necessary  to  amend  the  current 
arrangements for non-fibre flax. 

Vol  I EN -  30 

REPORTS  ON CERTAIN ASPECTS  OF THE BEEF AND  SHEEPMEAT SECTORS 

ANNEXE 

INTRODUCTION 

I. EVOLUTION OF THE BEEF MARKET 

A,  Three years since the implementation  of the Reform 

B.  Short- and medium-term  evolution 

a. Production 
b. Imports 
c. Exports 
d.  Consumption ^ 
e.  General  evolution 

n.  SPECIFIC ITEMS FOR WHICH A REPORT WAS REQUESTED 

A.  Special  Male Bovine Premium. 

a. Regional  Ceilings 

b.  The Second Age Bracket Premium for Bulls i 

B.  Deseasonalisation Premium 

C. The Beef and Sheep Quota Regimes in the Neue Bundeslànder (NBU) in Germany 

a.  The Beef Quota Regimes 1 

b.  The Sheep Quota Regime. 

m.  ANNEXES 

I.EU Market Prices- bulls and steers  (1991-1995) 
n.Comparison  of Beef R3 over Pig carcases Grade U 
IHSuckler Cow Premiums in the Member States of the EU  (1992-1994) 
IV.Third  Country  Commerce (beef)  -  importations 
V.Third  Country  Commerce (beef)  -  exportations 
VI. Supply balance sheet and short/mid-term forecasts  -Beef 
VH.Special Beef Premiums in the Member States of the EU  (1992-1995) 
Vin. Special Beef Premiums and Production in the Member States of the EU 
DCBeef Deseasonalisation Premium 
X.Beef Premiums in Germany 
XLEwe Premium  Claims in Germany  (1989-1995) 

Vol  I  E N - 31 

REPORTS  ON CERTAIN ASPECTS  OF THE BEEF AND  SHEEPMEAT  SECTORS 

INTRODUCTION 

At  the  adoption  of  the  1992  Beef  and  Sheep  Reform,  Council  laid  down  in  the  base 
Regulation  (EEC)  No  805/68  for  the  beef  sector the  following  requests  for  reports  to  be 
produced a couple of years after the reform had been implemented: 

-a  report on the  effects  of  the  deseasonalisation  premium  in the beef  sector,  together  with 
appropriate proposals (Article 4c of the basic regulation). 

-a  report,  accompanied  by  proposals  on the  application  in  the new  German Lander of  the 
quota rules for beef and sheep which apply in the rest of the Union [Article 4k of regulation 
(EEC)  No  805/68,  and  Article  5c  of  die  basic  regulation  in  the  sheep  sector  (EEC)  No 
3013/89]. 

Furthermore, at the  1994/1995  price fixing Council requested that the Commission examine 
and  make,  if  necessary,  appropriate  proposals  before  31  December  1994  on  thé  regional 
ceiling of the Special Male Bovine Premium between Member States. The Commission made 
no proposals by that date, in particular because it had not received data on the 1993 payments 
and it had no other information  demonstrating that a proposal was necessary. 

Finally, in the Council meeting of September 1995 the Commission declared itself to be ready 
to  carry  out a review  of  the premium  schemes,  bearing  in mind  developments  in the  beef 
sector  and  the  application  of  the  GATT  agreements  and  to  propose  adjustments  where 
appropriate. 

Besides those requested reports, the Commission takes the opportunity to address some other 
items, such as price evolution, the effects of the increased premiums, the effect of the second 
premium for non-castrated animals and the measures taken to place a control  on production. 

Vol  I EN -  32 

I. EVOLUTION  OF THE BEEF MARKET 

A.  Three years  since the implementation  of the Reform 

1. In November  1993 the Commission presented to Council a report on the prospects for the 
beef and veal  markets and the intervention  system  [COM(93)601 final] in which the market 
evolution until  autumn  1993 was commented as follows: 

After  the  important  increase  in  production  in  1990  and  1991,  which  reached  8.7  million 
tonnes,  the  production  decreased  in  1992  to  8.4  million  tonnes  and decreased  further  to  8 
million tonnes in  1993. As main factors behind this decrease in production were mentioned: 
-the  cyclical  nature  of  beef  production  which,  having  peaked  in  1991,  is  following  a 
downward trend in 1993; 
-the  1992  year  being  the  reference  year  for  the  premium  quotas  attracted  a  retention  by 
producers in order to increase their quota; 
-the limiting of imports of calves to 425.000 heads per year, 
-the increased  exports of live  cattle ready for slaughter. 

However,  production  subsequently  decreased  further  than  was  expected  in  the  report  of 
November 1993 and came down to 7.7 and 7.4 million tonnes in 1993 and 1994 respectively. 
Besides the abovementioned reasons, the fall in the total number of cows present in the Union 
from 33.4 million heads in 1991 to 31.8 million heads in  1993 had also contributed strongly 
to that extra decrease in beef production. 

2.  This important decrease in production had the following  effects  on the market: 

-  Stable prices,  slightly under the  80% of  the intervention price in  1992, were  experienced 
until  July  1993; then,  in  absolute  terms,  prices  decreased  somewhat  but,  due  to  the  three 
planned  5%  decreases  in  the  intervention  price  (as  foreseen  in  the  1992  Reform  and 
compensated  by  the  increase  of  the  premiums),  prices  stayed  well  above  80%  of  the 
intervention price until May  1995  (see graph in Annex I). 

- This price evolution made it possible for the Commission to reduce gradually the buying-in 
prices for intervention, making intervention less attractive to the abattoirs. The introduction 
by the Commission  in  1992 of  a weight limit for carcasses presented to intervention, made 
in order to discourage the selling of large carcasses of low market demand into intervention, 
had  a  further  effect,  albeit  slight,  on  this  evolution  because  the  quantities  offered  to 
intervention had already begun to reduce steadily.  Subsequently, with the firm market prices 
recorded, no more bids for intervention have been presented since autumn 1993. 

Vol  I EN  -  33 

- The  1992 Reform  included reductions in beef intervention prices with compensation aimed 
primarily  at  extensive  production,  in  part in  order to  reflect  the  reduction  of  the  costs  of 
intensive  producers  arising  from  the  reduction  of  cereals  prices  and  in  part  in  order  to 
maintain the competitiveness of beef by comparison with pigmeat. Pigmeat prices did indeed 
fall  following  the implementation  of the Reform,  as production  expanded in anticipation  of 
lower  feed  prices.  As  explained  above,  beef prices  fell  less  than the  reduction  in  the  beef 
intervention prices. This led to a price ratio of over 200% between beef and pigmeat in 1994 
which helps explain a reduction in beef consumption of around 2.5% that year. During  1995, 
however, beef prices fell in the early months of the year before recovering during the autumn. 
Meanwhile, pigmeat prices have recovered significantly.  This makes it possible to hope that 
the decline in beef consumption  can now be arrested (see graph in Annex II). 

-  Intervention  stocks were at a level  of  1.1  to  1.2  million tonnes in  1991  and  1992. Due to 
the fact that the buying-in phased  out in the course of  1993,  these  stocks could  be reduced 
gradually to 718.000 t in  1993, to  163.0001 in 1994 and to a quantity of around  15.000 t in 
autumn  1995. The sale of these stocks were mainly directed to third countries and exported 
in  the  pre-Uruguay  Round  years.  These  remaining  quantities  will  be  used  for  social  aid 
schemes in the Union. 

3.  In  1995  there  will  be  an increase  of  production  of  about  3% mainly  due to  the  usual, 
cyclical  increase of  production but also stimulated by the relatively  high prices in  1993 and 
1994. Together with a certain decrease of consumption and other disturbing elements on the 
market, in particular exchange rate developments, the effect was a rather abrupt decrease in 
prices this year from 85% of the intervention price in February  1995  to 78% in June  1995. 
This sharp and sudden price reduction  created problems for producers and consequently  the 
Commission took measures both to help producers by increasing the advance on the special 
male  bovine  premium  and to  stimulate  exports.  Mainly  as  a  result  of  the  resumed  export 
activities, from mid-August prices started to increase again and by mid-October were at 84% 
of the existing intervention  price, which had by then been decreased  again by  5% . 

Altogether,  it  can be  said that,  during the first three years following  the  1992  Reform,  the 
market price  evolution  has been for the most part somewhat higher than was  set out in the 
Reform,  with  1993  and  1994 recording rather high prices and,  after the  sudden decrease in 
prices  occurring  in  the  spring  of  1995,  a  similarly  sharp  recovery  being  recorded  in  the 
autumn. 

B.  Short-and medium-term  evolution  of the market 

Given  that the evolution  of  the  market has been,  in general,  positive  since the  introduction 
of  the  1992  Reform,  the  question  arises  as to  whether  it  can  be  expected  to  continue.  A 
possible  answer  can  only  be  given  after  examination  of  the  various  elements  behind  the 
evolution  of the market. 

Vol  I EN  - 34 

a.  Production 

For  1995 it is expected  that the production  will have increased by around 3% while for  1996 
production  is expected  to increase by  1 or 2%. This is part of the usual  upward  trend  in  the 
production  cycle  in the beef  sector after  the important  decrease in production  between  1992 
and  1994.  However,  it  should  be  noticed  that  the  reproductive  herd  (total  number  of  cows 
present  in  the Union)  did  not increase  during  recent  years. It  remained  stable  from  1993  to 
1995. The total number of dairy cows continued to decrease by 200-300.000 heads per year, 
but  the  suckler  cow  population  increased  by  nearly  the  same  number.  As  offspring  from 
suckler cows generally produce heavier carcasses, this change in the breeding cow herd could 
explain  a part  of the  anticipated  increase  in  production  in  1995/1996. 

With  respect  to the  future  evolution,  a further  gradual  decrease in the  dairy  cow  herd  by  1 
or perhaps 2% per year may be expected, but it is obvious that this development of the sector 
may  be to  some degree  offset  by  the  increases  expected  in the  suckler  cow  herd  in  coming 
years. 

According to Eurostat figures,  in December  1994 there were  10.4 million suckler cows in the 
Union  (EU-12).  In  the  same  year,  premium  was  granted  for  9.4  million  suckler  cows  (see 
Annex EI). However,  potential premium rights (the sum of all the individual  premium  quota 
rights  held by  producers)  are  available  for  10.8  million  suckler cows.  Since in  1992 it  had 
been  decided  as  part  of  the  Reform  that  the  year  1992  could  be the  reference  year  for  the 
individual  suckler cow quota, many producers may have stocked up their number of  suckler 
cows  and  now  find  themselves  with  a  number  of  animals  above  the  "density  clause"  (2.5 
LU/ha  in  1995).  Thus,  these  producers  cannot  claim  premium  for  all  their  suckler  cows. 
Nevertheless,  as time  passes, transfers  of  quota will  take place with the result  that  premium 
claims will  increase.  This process could  thus lead to a further rise in suckler  cows numbers, 
offsetting  partly  or  totally  for  the  coming  years the  decrease  in the number  of  dairy  cows. 

Other  important  factors  determining  future  evolution  of beef  production  are: 

-  The  reduction  in  the  density  clause,  introduced  by  the  1992  Reform  as  a  measure  to 
orientate the sector to an extensive form  of production, within the general  context of  control 
of  production,  and  to  avoid  rural  depopulation  ("desertification"),  will  continue  to  exert  its 
influence  in stabilising production in  1996 when the maximum permitted  stocking rate passes 
from  2.5  LU/ha to  2.0 LU/ha. 

-  Since around  6 million calves are destined for veal production each year, it is important  for 
the market  equilibrium  that this production  be maintained  at its present level. Given that  the 
veal  sector  does  not  receive  any  specific  assistance  under  the  common  market  organisation 
for  beef  and veal,  market balance  is determined  by  supply  and  demand.  Should  demand  for 
calves for  veal  production  fall,  the  calves will  be reared  to heavier  carcase weights  and  this 
could  have a significant  effect  on the balance  of beef  production  as a whole. 

Vol  I EN - 35 

- The restriction  on calf  and young  cattle imports to 425.000  head,  introduced  in  1991, had 
a  very  positive  effect  on  the  control  of  production.  However,  according  to  the  PECOS 
association  agreements this restriction has now been increased to 500.000 head, which  means 
that  an equivalent  extra  quantity  of beef will  be present on the Union's  market. 

b.  Imports  (see Annex IV) 

Most  of the imports  of young  animals  and beef  take  place in the form  of quotas  or  import 
arrangements  in association  agreements.  Total  imports for all types of products  in the beef 
sector  are  set  at  525.000  t  carcase  equivalent  and  there  is  not  much  evolution  in  these 
quantities.  It  is  important  to  note,  however,  that  due  to  the  fact  that  the  Union's  self-
sufficiency  lies  over the  100%, for  each  tonne of beef  that the Union  imports,  unless  there 
is an increase in consumption,  an equivalent  quantity  of production  has to be cut. 

c. Exports (see Annex V) 

Total  exports  of  beef  and  beef  products  were  at  a  level  of  1.3  million  tonnes  carcase 
equivalent in 1991 and 1992 and decreased to 1.2 million tonnes in  1993 and 1994. It should 
be  noted  that,  in  each  of those  years,  these  quantities  include  some  500.000  t  of  exported 
intervention  beef. According to the Uruguay  Round  rules, for the UR year running from the 
1 July  1995 until  30 June  1996, the Union  has to limit the delivery  of export  certificates  to 
1.118.700 t, although that figure  is subject to revision in the light of the current  negotiations 
of  Article  24  (6)  of  the  GATT  Agreement.  Due  to  the  fact  that  the  small  quantity  of 
intervention stocks remaining (15.0001) is not available for export, this export ceiling should 
not, in itself, have created too many problems in its first year of application. However, as the 
ceiling operates  on the level  of delivery  of certificates,  some problems have emerged  due to 
competition  between  exporters  for that  limited  volume of  certificates. 

However,  distributing the limited volume of export certificates  which we are entitled to grant 
has not proven  easy. World  market prices have been firm  and there has therefore  been  keen 
competition  between  exporters  to  take  advantage  of  the  opportunities  it  has  offered. 
Establishing  the  correct  level  of  refund  and  the  most  appropriate  terms  for  granting  the 
certificates  (i.e. duration  and level  of deposits) has been  difficult  and controversial. 

Indeed,  exporters  and the Commission  are in the process  of  adapting  to  a  situation  where 
export  licences  are  no  longer  available  in  unlimited  quantities.  In  the  framework  of  the 
Management  Committee,  this process of adaptation  has been addressed.  However,  it should 
be recalled  that in the year 2000 this export ceiling has been established  at 817.000 t, which 
represents  300.000  to 400.000 t  less than  in the early  1990s. 

Vol  I EN  - 36 

d.  Consumption 

Over  the  past  few  years,  the  annual  net  balance  for  beef  and  veal  consumption  has  been 
between  21  and  22  kg  per  person  (see  Annex  VI).  In  1993  and  1994  this  figure  decreased 
somewhat.  The decline is partially  explicable in terms of relative price but health and, in the 
case of  veal,  animal  welfare  issues also played  a part. The recent revival  of public  concerns 
over  B.S.E.,  in  particular  in  the  United  Kingdom,  is  bound  to  have  an  adverse  effect  on 
consumption  but,  at  present,  it  is  not  possible  to  foresee  whether  this  effect  will  be  long 
lasting  or  transitory.  Our current  forecasts,  therefore,  do  not  take  account  of this  and  show 
a  stable trend  in  consumption  in the Union  as a whole. 

e.  General  evolution 

At the  present  moment  and based  on the  latest forecasts  available, the Commission  expects 
that  after  the rather small increase in production  in  1995, a further  small increase is likely  to 
occur  in  1996. Under  these circumstances,  it is clear  that  no measure whatsoever  should  be 
taken which would have the effect  of encouraging an increase of production. On the contrary, 
if there are measures which could lead to a decrease in production and which can be regarded 
as  small  adaptations  of the Reform,  they  should  be  seriously  examined.  The only  measures 
that the Commission  could contemplate taking at this stage are, therefore,  adaptations which 
would  tend to decrease, rather than increase, production.  On the other hand, there is nothing 
in the evolution of the market which has so far been experienced, or foreseen, which  suggests 
that  the  1992 Reform  should  be changed  fundamentally. 

Vol  I EN -  37 

H.  SPECIFIC ITEMS FOR WHICH A REPORT WAS REQUESTED 

A.  Special  Male Bovine Premium. 

a. Regional  Ceilings 

The  main  objectives  of  this  premium  scheme  are  to  give  a  certain  compensation  for  the 
decreased intervention price mainly to the small and medium-sized producers and to stimulate 
more  extensive  methods  of  production  and the  scheme  can be  said to have  had  a  positive 
effect  as an income support for the fanner for a limited production and to have worked in the 
right  direction as far as the need to control production. 

In terms of the distribution of regional  ceilings, it will be recalled that in the  1992 Reform, 
the  possibility  for  the  Member  states  to  choose  the  year  1992  as  reference  year  was 
established. In 1994, Council concluded that taking 1992 as the reference year had given rise 
to  a  certain  lack  of  balance between the  distribution  of  the regional  ceiling  in  the  various 
regions of the Union. Through Regulation (EC) No 1884/94, Council revised that distribution 
and reduced the Union's global ceiling from  11.517.000 to 10.281.000 heads. In Annex VU, 
data  are  given  concerning  the  granting  of  the  Special  Beef  Premium  and  in  Annex  VIE 
information  is presented on the relation between the number of male bovines for which the 
premium was granted and the number of animals slaughtered throughout the Union. 

It is not to be expected that there will be a single relationship between the size of the regional 
ceilings  and the  number of  animals  slaughtered  in  each Member  State.  In the first place, 
animals  may  attract  a  premium  in  one  Member  State but  be  slaughtered  in  another.  The 
regular  trade  in  store  animals  between  France  and  Italy  is  a well-known  example  of  this 
phenomenon. In the second, other restrictions in the granting of the premia (the 90-head limit 
and the density clause)  affect  the number of animals eligible to different  degrees depending 
on the different  structure of the beef industry in different parts of the Union. It is, therefore, 
not  surprising  to  note  that  those  Member  States  where  the  size  of  the  ceiling  is  low  by 
comparison to the number of animals slaughtered have not in fact had to scale down premium 
payments as a result of the ceilings. 

Therefore,  due to the successful  rôle played by the current form of the Special Male Bovine 
Premium Scheme in the general balance of the 1992 Reform, the Commission does not intend 
to propose changes in the regional  ceilings. 

Vol  I EN - 38 

b.  The  Second  Age Bracket Premium for Bulls 

With regard to the  second age bracket premium, the table in Annex VII shows that in  1994 
this premium ,was claimed  for  870.800 bulls. Information from farmers indicates that many 
producers try to keep bulls until 23 months of age in order to obtain the second age bracket 
premium and that the increased value of the premium in  1995 will  encourage more fatteners 
to do so in future.  According to trade and slaughterhouse  sources, those 23-month old bulls 
do not really represent the required quality and tend to be, in general, overfat and overweight. 
It may be concluded that the second age bracket premium for bulls stimulates a product not 
required by the market and furthermore increases beef production artificially.  For that reason 
the Commission proposes to delete that second age bracket premium for bulls and to increase 
the  corresponding first age bracket premium from the actual  level  of  108,7  ECU  to  123,9 
ECU per animal (+  14%), which would thus be in the form of a single premium payment paid 
once  in  the  lifetime  of  the  animal.  On  the  assumption  that  the  change  does  not  lead  to 
additional  production  of  steers  and lower  production  of  bulls,  this  is  a financially neutral 
measure since, based on  1994 figures, the expenditures for the second age bracket premium 
may be used to offset  the increase cost of  the increased first age bracket premium. 

The deletion of the second age bracket premium will also remove an unintended consequence 
of  the  change  in  the  premium  regime  which was  made in  1992  as regards bulls  used  for 
bullfighting.  In  applying  the  1992  Reform  in  1993,  Spain,  quite  legitimately,  changed  the 
system of payment of the premium from payment at slaughter to payment on the farms. This 
meant that the producers were  able to claim the second premium  on bulls which had been 
selected  as fighting animals as well  as bulls destined for slaughter at abattoirs. This aid has 
been criticised as it has been seen as an aid for the production of fighting bulls.  Such an aid 
is legitimate in the sense that the existing regime accidentally  fails to exclude it but did not 
form part of the Commission's intention in proposing the 1992 Reform. Should Council decide 
not to adopt the proposal to delete the second premium on bulls then the Commission reserves 
the right to make a second proposal to remove this anomaly. 

B.  Deseasonalisation  premium 

This premium, established as part of the 1992 Reform, is intended to encourage producers to 
extend the marketing of their steers throughout the whole year instead of delivering the bulk 
of the production in the autumn peak period. To this effect,  the actual regulation  [Article 4c 
of Council  Regulation  (EEC) No  805/68] foresees that: 

"Where, in a Member State, the number of male bovine animals slaughtered during the period 
1 September to 30 November of the year exceeds 40% of annual slaughterings of male bovine 
animals  producers  may  qualify,  as  from  the  1993  calendar  year,  on  application,  for  an 
additional premium to the special premium granted under Article 4b (deseasonalisation premium)" 

The  40% clause was  meant to limit this premium  to regions where  producers bring to the 
market a major part of their production in the autumn peak period and to encourage those 
producers to change the periodicity  of their traditional marketing. 

Vol  I EN -  39 

It can be said that the deseasonalisation premium in Ireland has had a major effect in the way 
steers  are  marketed  in  the  September-November  period  since  autumn  marketings  have 
decreased  from  50%  in  1990-92  to  41% in  1993-94  and  marketings  in  the  spring  have 
increased from  around 24% in  1990-92 to 35% in 1994. 

The  abrupt  ending  of  the  deseasonalisation  premium  at the end  of  each  April,  as  foreseen 
originally  in  the  1992  Reform,  tended  to  concentrate  slaughterings  in  that  month.  This 
problem was  addressed by a modification  to Article 4c (2) of Regulation (EEC) No  805/68 
which provided for  a gradual  scaling down of the amount of the premium. However,  there 
remain some factors which should be mentioned and which played a role in the functioning 
of the deseasonalisation premium: 

a. The annual increase of  18 ECU of the premium for male animals between  1992 and  1995 
had the effect of stimulating producers to market their animals in the following spring instead 
of  in  the  previous  autumn.  As  the  final  annual  increase  was  made  in  1995,  this  extra 
stimulating  effect  will  no longer exist in the future. 

b. The fact that in 1995 (and this will also be the case in 1996) the deseasonalisation premium 
was applicable in the Irish Republic but not in Northern Ireland created some tensions. This 
situation  concerned  not only  similar  production  methods in the  same type  of  landscape  in 
comparable geographical  regions, but it  also provided financial incentives to producers and 
traders to send animals from Northern Ireland to the Republic of Ireland for the sole purpose 
of  claiming premium. However,  since this cross-border trade is, for veterinary  reasons, not 
permitted, the premium rules created incentives which were manifestly  contradictory to the 
animal health measures. 

c.  The number of animals exported live to third countries increased from 6.6% of total Irish 
beef exports in  1992 to 20.2% in  1994.  These  exports are based upon a specific  request by 
certain  third  countries  and  continue  the  whole  year  around,  even  in  those  periods  with 
traditionally  low to very low supply of the market. In the autumn peak period those exports 
do not increase  substantially. 

In Annex IX, detailed information about the application of the deseasonalisation premium is 
presented. Forecasts currently available show that in 1995 the 40% trigger will not be met for 
the Republic of Ireland. Consequently,  according to Article 4c (1) of the basic regulation, the 
deseasonalisation  premium  would  not  be  applicable  in  1997.  This  abrupt  ending  of  the 
premium, together with the end of the stimulating effect of the yearly increase of the premium 
in  1996,  may  lead  to  a  situation  in  which  producers  go  back  to  their  former  pattern  of 
marketing the bulk of their production in the autumn. In that case, the market organisation 
could  come under pressure to apply  measures which are "undesirable" for the Union's beef 
market as a whole. 

Therefore,  in order to keep producers to the pattern of  marketing which they  are currently 
practising  and  to  avoid  certain  inconveniences  of  the  scheme  as  applied  in  the  past,  the 
Commission  proposes  to  modify  the  existing  dispositions  of  Article  4c  (1)  of  the  basic 
regulation in the following  sense: 

Vol  I EN  - 40 

a.  In order to avoid  the  situation  where the deseasonalisation  premium  is  applicable  in  the 
Republic  of  Ireland  but not  in Northern  Ireland, the calculation  of  the percentage  of  steers 
slaughtered will  be made on the basis of the total  number of  steers slaughtered in Republic 
of Ireland and in Northern Ireland. Furthermore, in order to take into account that the seasonal 
effect  is generally  less pronounced in Northern Ireland, the trigger is reduced to 38%. 

b.  In Member  States  or regions where  steer production accounts for more than 60% of  the 
total male bovine  animal  production  and where Article 4c  (1)  has been applied  in the past, 
a Member State may  grant a deseasonalisation  premium of 43.47 ECU (that is,  60% of the 
current premium  of  72.45  ECU),  scaled  down at the end of the period in the same manner 
as at present. In this case, where this premium is applied in the Republic of Ireland, it shall 
also  apply  in Northern  Ireland,  and  vice  versa.  The  expenditure  for  this  deseasonalisation 
premium shall be covered by an appropriate reduction of the second age bracket premium for 
steers.  That  reduction,  calculated  for  each  region  separately,  will  be  established  by  the 
Commission according to the Management Committee procedure before the final payment of 
the second age bracket premium.  <-

C. The Beef  and Sheep Quota Regimes in the Neue Bundeslànder fNBL)  in Germany 

a..  The Beef Quota Regimes 

Under Article  4k  of  Regulation  (EEC) No  805/68,  a derogation  for the  new Bundeslànder 
(NBL) meant that: 

a) Germany has: 
-a special  regional  ceiling  of  660.323  male bovine and  180.000  suckler cow premiums. 
-  an option to switch up to  15% of  premium rights between the two special  ceilings. 
-  permission to decide the conditions for distributing the special  ceilings. 
-a special  derogation to the  suckler cow definition from 1993 to the end of  1995. 

b.  The Commission: 
-may adopt special  rules for  implementing  this article which option was not taken. 
-shall  submit, before the end of  1995, a report to Council, with proposals on the application 
in the NBL territory  of the rules which apply in the rest of the Union. This is the subject of 
the present part of this report. The Council shall decide on these proposals before the end of 
1996. 

Broadly  speaking,  the  bovine  sector  in  the NBL  has  evolved  from  a position, just  before 
reunification,  of comprising almost 2 million dairy cows but hardly any suckler cows.  Some 
45% of the dairy herd was slaughtered in 1990-91. In 1995 claims for suckler cow premiums 
reached  a level  of  179.300  heads,  thus  meeting  the  regional  ceiling.  The  bull  herd  in  the 
former  DDR  numbered  1.27  million  heads  while  claims  for  bull  premium  in  1995  are 
estimated at  400.000  head and stayed below the regional ceiling. In Annex X, the evolution 
of the beef herds and the premiums granted in the Alte and Neue Bundeslànder of Germany 
are presented. 

Vol  I EN  - 41 

Within  the  framework  of the  Suckler  Cow  Regime  Germany  has  requested: 

a.  to  apply  the  15%  switch  between  the  male  bovine  regional  quota  and  the  suckler  cow 
regional  quota. As this possibility  is foreseen  in the basic regulation, the Commission  has no 
objection  to that  transfer. 

b.  to  apply  another  15% switch  in  the same direction  in future.  This  procedure,  however,  is 
not foreseen  in the basic regulation.  As such a switch  is obviously  in  contradiction  with  the 
need to control  production, the Commission  cannot propose to amend the basic regulation  in 
that sense. 

c.  to  continue  the  regional  quota  for  suckler  cows  until  the  year  2000.  On  this  point  the 
Commission's position is that, after  a 5-year transition period, the individual  limits should  be 
introduced  now  to  make  producers  aware  that  there  is  a  problem  in  controlling  beef 
production. Rights, which have not been allocated to producers at the moment  of the  switch 
to the system of individual rights, should be cancelled, except an allocation, calculated as 3% 
of  the  total  number  of  individual  rights  allocated  to  producers,  which  may  be  made  to  the 
national reserve. However, the sum of the total number of individual rights allocated  plus the 
rights  allocated  to  the  national  reserve,  shall  not  exceed  the  sum  of  the  original  special 
regional  ceilings. 

d.  continue  the  derogation  of  the  suckler  cow  definition  for  two  more  years.  It  should  be 
noted  that  this  derogation  ends  on  31  December  1995. As  similar  requests  from  two  other 
Member  States  did  not  receive  a  positive  response  from  the  Commission,  it  is  not  in  a 
position  to  accede to the present  request. 

In  general  terms,  suckler  cow  production  was  taken  up  rather  well  in  the  NBL  and  the 
regional  ceiling was reached  in  1995. As Germany  wishes to apply the  15% switch  foreseen 
in the  basis  regulation,  there is  some room  for  further  evolution  of  that type  of  production. 
However,  there  are  no  major  reasons  to  continue the  regional  ceiling  for  suckler  cows  and 
therefore  suckler  cow  producers  in  the  NBL  should  work  from  1997  onwards  under  same 
conditions  of the  individual  producer  quota  as their  colleagues  in the rest of  the Union  do. 

On  the  Special  Male  Bovine Premium,  the  German  authorities wish  to waive the  90-head 
limit  or  at  least  to  obtain  a temporary  derogation  on  that  limit  for  the NBL  until  the  year 
2000.  On  this  point  it  should  be  mentioned  that  the  German  authorities  interpreted  the 
provision  which  enables them  to establish  rules for the distribution  of the special  ceilings as 
permitting  them  to  derogate  from  the 90-head  limit rule. 

As emphasised  earlier  in this  report,  the Commission  cannot  accept  any  change  in  the  beef 
regime which might lead to an increased production. Thus, it is not in the position to propose 
the  general  deletion  of  the 90-head  limit  for  the  Special  Male Bovine  Premium.  Moreover, 
it  should  be noted  that the total  numbers  available  under the regional  quota  in the  Alte  and 
the Neue Bundeslànder is rather large, leaving sufficient  margin for the eventual  development 
of bull production  in the New Lander under the same conditions as in the rest  of the Union. 
It should also be noted that the NBL is not the only region of the Community  with large bull 
production  enterprises. The existence of such enterprises is not, therefore,  a sufficient  reason 
for  a derogation  for  the NBL. 

Vol  I EN - 42 

b.  The Sheep Quota Regime 

Under Article ,5c of the basic regulation (EC) No 3013/89, a derogation for the sheep sector 
in the NBL, similar to that in beef,  meant that: 

a) Germany has: 
-a special  regional  ceiling of  1 million ewe premiums 
-permission to decide the conditions for distributing the special  ceiling. 

b) The Commission: 
-may adopt special  rules for implementing this article (option not taken) 
-shall  submit, before the end of  1995, a report to Council, with proposals on the application 
in the NBL territory of the rules which apply in the rest of the Union. This is the subject of 
this part of the report.  Council  must also decide on these proposals by the end of  1996. 

In  the  former  DDR  the  sheep  flock  of  2.6  million  head  was  mainly  directed  to  wool 
production. After unification the 1 million head ewe flock decreased to 500.000 ewes, but has 
now stabilised, giving a premium claim total  of  550.000  ewes in  1995 (Annex XI). 

The German authorities request a simple continuation of the existing derogation until the year 
2000,  arguing  that  the  restructuring  is  not  yet  completed  and  that  the  introduction  of 
individual  producer limits would now create administrative difficulties  in the NBL. 

The  Commission  does  not  accept  the  argument  of  administrative  difficulties  for  not 
introducing the individual  producer limits. It can, however, agree with the argument that the 
restructuring process  is not yet  completed  since the regional  quota is far from having been 
met, in contrast to the situation which prevails with regard to suckler cows. Consequently, the 
Commission can agree to postponing the introduction of the individual limits until  the year 
2000.  Also,  Germany  may  decide  to  introduce  individual  limits  in the whole  of  the  NBL 
before the year 2000. Rights, which have not been allocated to producers at the moment  of 
switch to the system of individual rights, should be cancelled, except an allocation, calculated 
as 3% of the total number of individual rights allocated to producers, which may be made to 
the national reserve. However, the sum of the total number of individual rights allocated plus 
the rights allocated  to  the  national  reserve,  shall  not  exceed  the  original  special  regional 
ceiling. 

ANNEX I 

380 

370 

360 

350 

- 

/'*•*•% 

.5? 
'S 

o 
(0 
(Q 
O 
u. 
(Q 
O 
O) 
XL 
O 
O 
T-

3 
o 

UJ 

«î 
0) 

z 

340 

330 

320 

310 

300 

290 

280 

270 

EU MARKET PRICE - BULLS AND STEERS (1991-95) 
UE PRIX DE MARCHE - JEUNES BOVINS ET BOEUFS (1991-95) 
EU MARKTPREIS - JUNGRINDER UND OCHSEN (1991-95) 

• 
.» 
/ 

,% 

8 0%  (330) 

* 

\ 

i * » - - »* 

» 

» 

» 
V 

' 
/ 

« 

t 

»  » 
» 

8 0%  (309) 

\ 

8 0%  (292) 

\ 

88 

-  84 

80 

76 

72 

- 

68 

64 

C 
o 
C 

1  1  1  1  1  1  1  1  1  1  t  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  t  1  1  | 

Jan/91 

Jul 

Jan/92 

Jul 

Jan/93 

1  1  t  1  1  1  t  1  1  1  1  1 
Jan/94 

Jul 

Jul 

Month 

J 

8 0%  (278) 

— 

60 

1  1  1  t  1  1  1  1  1  t  1 

1  1  1  1  1  1  1  t  1  1  1  1 

56 

Jan/95 

Jul 

Jan/96 

Jul 

Lr> 

ANNEX II 

* 

Q 
CL 

400 

0) 
Q) 
OÙ 
«M 
ai 
'3 

a 
to 
o 
hm 
(Q 
O 
CI 

O 
o 
3 
o 

UJ 

z 

300  h-

200 

100 

COMPARISON  OF  BEEF AND PIG CARCASE  PRICES - (1987-95) 
COMPARAISON  DES PRIX DE CARCASSES  DE BOEUF ET PORC -  (1987-95) 
VERGLEÏCH DES KARKASSENPREISES VON RINDERN UND SCHWEINEN - (1987-95) 

o 
CL 
k. 
0) 
> 
O 
* •-
<D 
0) 
m 

0) 
en 

•4-" 
C 
<D 
O 
k. 
0J 
CL 

_£ 

Year 

ANNEX 111 

EU SUCKLER COW PREMIUM (1991-94) 
UE PRIME AUX VACHES ALLAITANTES (1991-94) 
EU MUTTERKÛHPRÂMIE  (1991-94) 

Number of cows having received the premium (R. (EEC) No. 1357/80 and 805/68) 
Nombre de vaches ayant bénéficié de la prime (R. (CEE) N* 1357/80 et 805/68) 
AnzahlderKûhe, fOrwelche die PrSmle gewâhrtwurde (R. Nr. (EWG) 1357/80 und 805/68) 

||MèTnrfô&ptàtèg 

Z l 9 9 3 ^ v - :^ 

^^f5wh^|§|É 
mixed HerâyS^ 

1994*^ajp 

r(orwfiïcri"mlx'oci 

Pôtëritiâl rights 

Suckler cow 

herd(12/94)(c) 

Belglque/Belglë 

Danmark 

Deutschland § 

Elias ('90) 

Espafla 

France 

Ireland 

Italia 

Luxembourg 

Nederland 

Portugal 

United Kingdom 

ôsterrelch 

Suoml/FInland 

Sverlge 

TOTAL 12 

TOTAiÈi5 

Legend: 

267.504 

84.110 

205.746 

131.471 

403.029 

435.098 

70.000  §§ 

423.728.0 

70.000,0 

§§ 

121.661 

101.947 

700 

104.420,0 

446.628 

413.237 

132.006 

125.823 

54.641 

2.005 

505.685.0 

120.874.0 

590,0 

67.117,0 

2.145,0 

1.307.916 

1.363.337 

1.215.115 

85.058 

1.133.150,7 

90.000.0 

§§ 

3.260.759 

3.616.219 

3.603.923 

343.790 

3.492.260,0 

311.700,0 

783.636 

1.024.757 

700.943 

704.000 

8.880 

41.483 

11.648 

67.444 

883.757 

673.673 

13.179 

50.209 

51.377 

137.901 

910.091.0 

807.938,0 

2.700 

13.235.7 

5.000  §§ 

57.521,0 

204.752 

240.099 

240.000 

20.000  §§ 

236.348,4 

1.488.043 

1.669.538 

1.558.206 

12.844 

1.552.408,0 

51.680,0 

97.786,0 

2.135,7 

902,0 

4.671,1 

13.368,0 

443.166 

135.937 

651.122 

149.778 

1.462.527 

3.886.366 

1.106.528 

787.762 

14.826 

98.006 

286.554 

1.805.323 

325.000 

55.000 

155.000 

475.000 

105.000 

594.700 

87.800 

1.396.000 

3.968.000 

956.700 

722.000 

29.400 

72.000 

230.000 

1.783.000 

90.000 

33.600 

165.000 

8:485.243  ^ ^ 9 . 8 0 0 ; 3 66 

^'••9.314.167 

MllHBl 

786.016  §§ 

9.357.659,8 

712.094,8 

§§ 

10.827.895 

10.419.600 

11.362.895 

10.708.200 

•  Provisional figures 

§  Including New Under (90=67.880, 91=27.860, 92=91697, 93=114.430, 94=153.327) 

§§ Estimated figures 

(a) In the case of DK and NL the figures refer to daims 

(b)  Not Consolidated. Estimated figures excluding additional rights foreseen for extensive producers. 

(c)  EUROSTAT (for Sweden figures refer to 6/94) 

ST 

ANNEX IV 

EU BEEF TRADE -  IMPORTS FROM THIRD COUNTRIES (1981-94) 
UE COMMERCE DE VIANDE BOVINE - IMPORTATIONS EN PROVENANCE DES PAYS TIERS 
EU RINDFLEISCHSEKTOR - IMPORTE AUS DRITTLANDERN 

WSSÊUS&"^^:^' 

:f f 

:-y&y 

. 

'

.

•

,

;:^

^

^

^

:i

;.  m^m?m  §##MEÂJS$  ^ ^ ^ • / " • V - : ' - .. 

'• 

_ 

• ' ^ ë ar •.•-*• 

V ' ^ '^ 

C a ï v è s ^ f p ^^ 

t ^ >!^ g S^  replacements^, 

(a+b+c) 

Tonnes  ' 

;  : - ; ; ^ ; .vV p ^ ' ^^ 

Meat 

equivalent 

^ s W- 

^:F^ 

TOTAL 

...  -u .,... ••.; :o -u &?&,w*  ^..v&smoked^Vc; (cooked i  uncooked)  . (e+f+g+h+I) 

a 

b 

c 

d 

= 

e 

f 

g 

h 

I 

1981 
1982 
1983 
1984 
1985 
1986 
1987 
1988 
1989 
1990 
.  1991 
1992 
1993 
1994 

61.948 
186.581 
216.295 
175.469 
145.830 
179.613 
272.018 
184.187 
473.918 
853.367 
339.345 
247.545 
395.399 
477.640 

195.333 
243.803 
247.652 
218.536 
298.434 
268.860 
350.365 
348.946 
372.480 
343.518 
376.510 
384.657 
88.900 
90.796 

53.223 
57.764 
40.724 
33.820 
45.654 
31.403 
44.251 
37.077 
60.383 
46.504 
44.164 
83.808 
114.187 
103.041 

310.504 
488.148 
504.671 
427.825 
489.918 
479.876 
666.634 
570.210 
906.781 
1.243.389 
760.019 
716.010 
598.486 
671.477 

50.055 
66.010 
63.654 
54.273 
71.097 
63.357 
85.702 
87.364 
101.739 
101.854 
87.308 
92.533 
80.110 
76.799 

._. 

54.519 
72.011 
86.545 
84.535 
126.510 
129.525 
138.495 
131.450 
122.147 
124.659 
151.719 
163.796 
144.725 
143.189 

120.666 
163.441 
152.564 
128.418 
139.722 
115.849 
120.698 
110.126 
109.398 
108.650 
109.823 
101.959 
93.138 
128.697 

306 
236 
364 
609 
274 
269 
277 
295 
290 
304 
345 
"~  339 
371 
687 

138.363 
138.483 
144.453 
146.783 
151.431 
156.325 
151.205 
178.515 
172.312 
165.179 
185.323 
213.794 
180.829 
182.901 

J 

364.009 
440.181 
447.580 
414.618 
489.034 
465.325 
496.377 
507.750 
505.886 
500.646 
534.518 
572.421 
499.173 
532.273 

ANNEX V 

EU BEEF TRADE -  EXPORTS TO THIRD COUNTRIES  (1981-94) 
UE COMMERCE DE VIANDE BOVINE - EXPORTATIONS A DESTINATION DES PAYS TIERS 
EU RINDFLEISCHSEKTOR - EXPORTE AUS DRITTLANDERN 

^ 

^ P Si 

1 

MlVE?ANIMAliS^  V '  X 
1 

1 

m^M^^MM&^^^^imy::^ 

v^^'-U:^'." 

^ v ^ : ' ' . ^ - - : : > - '- •;•;•/;>MEATS^ 

j'^Tonn^s;;' 

'o;-'';;;.n'\-£--r^ 

^ ^ ^ ^ ^ ^ ^ ^ ^ S ^ ^ S ^ Ê j ^ ^ l W W ^ - - '^ 

v.,  "'*'•*:* *, J ,' ^ | * j p j r 5 |^ 
a 

b 

c 

d 

= 

e 

f 

• ÇMf?* • v- — 
equivalent 

^ré^^:-:'':0Ffozeife-,-.••>Sajté1d>drleci \:-•  :iProcessed 
'& s m o k ed 

TOTAL 

' '""•'/:-*'?  ;  ' 
g 

h 

(choked & uncooked) 
I 

(e+f+g+h+i) 
J 

1981 
1982 
1983 
1984 
1985 
1986 
1987 
1988 
1989 
1990 
1991 
1992 
1993 
1994 

7.591 
5.848 
4.039 
4.121 
4.613 
4.098 
3.309 
4.018 
3.162 
3.216 
3.194 
3.244 
3.143 
4.824 

360.696 
299.780 
339.611 
295.707 
145.362 
115.731 
77.527 
70.437 
58.864 
73.744 
157.395 
207.472 
400.385 
440.088 

32.972 
36.113 
53.854 
66.920 
124.789 
67.209 
87.119 
50.347 
52.790 
49.843 
166.629 
115.791 
78.910 
87.987 

401.259 
341.741 
397.504 
366.748 
274.764 
187.038 
167.955 
124.802 
114.816 
126.803 
327.218 
326.507 
482.438 
532.899 

100.282 
88.379 
102.984 
96.058 
72.030 
49.479 
43.498 
30.314 
30.596 
34.106 
80.942 
84.724 
143.237 
147.906 

183.364 
117.638 
144.620 
185.979 
157.967 
169.179 
133.927 
80.232 
81.337 
90.888 
143.827 
105.062 
104.248 
110.885 

340.052 
235.539 
316.004 
463.154 
532.799 
903.845 
694.189 
643.172 
880.608 
656.997 
1.029.712 
1.013.700 
887.175 
848.456 

763 
839 
828 
1.064 
1.013 
1.388 
1.142 
1.375 
1.833 
4.645 
1.442 
1.818 
1.965 
1.093 

37.725 
37.873 
38.326 
44.171 
40.841 
42.662 
36.341 
30.352 
29.236 
29.383 
68.943 
118.090 
91.858 
111.914 

662.186 
480.268 
602.762 
790.426 
804.650 
1.166.553 
909.097 
785.445 
1.023.610 
816.019 
1.324.866 
1.323.394 
1.228.483 
1.220.254 

Source: EUROSTAT-COMEXT 

ANNEX  VI 

Bovine population (1000 head) 

Cow  herd (1000 head) 

Net Production1 (Tm) 

Meat Imports (Tm) 

Meat Exports (Tm) 

Variation In stocks (Tm) 

a) Public 

b) Privés 

Available for consumption 
(Tm) 

in kg/capita 

Gross Internal Production  ' 
(Tm) 

% Self  Sufficiency 

Public Intervention (Tm) 

a) Purchases 

b) Sales 

EU BEEF  SECTOR:  SUPPLY  BALANCE  SHEET  AND  SHORT/MID-TERM  FORECASTS 
U.E. VIANDE  BOVINE  : BILANS  D'APPROVISIONNEMENT  ET PREVISIONS  A  COURT-MOYEN  TERME 
EU RINDFLEISCH: VERSORGUNGSBILANZ  UND  KURZ-  UND  LANDFRISTIGE  VORAUSSCHATZUNGEN 

1991 

1992 

EU  12 

1993 

in  thousand  head/metric  tonnes 

EU  15 

1994 

1995  (estimated 

1995  (forecast) 

1996  (projected) 

±% 

-1,4 

-  1,5 

84.675 

33.385 

8.723 

+  5,1 

±% 

-3,8 

•3,7 

-3,7 

±% 

±% 

i% 

±% 

±% 

79.320 

-2,6 

78.540 

-  1,0 

78.980 

+  0,6 

31.825 

-  M 

31.830 

+  0,0 

31.770 

-0,2 

84.320 

33.790 

84.000 

•0,4 

33.650 

-0,4 

7.710 

-8,2 

7.380 

-4,3 

7.625 

+ 3,3 

8.100 

+  3,3 

8.200 

+  1,2 

419 

1.085 

-448 

718 

0 

455 

1.072 

-555 

163 

0 

•  160 

0 

0 

.  460 

900 

-  160 

3 

0 

470 

850 

0 

0 

0 

81.435 

32.165 

8.396 

480 

1.239 

+  155 

1.166 

0 

+  2,0 

7.482 

0,9 

7.492 

+ 0,1 

7.318 

-2,3 

7.400 

+  1,1 

7.820 

7.820 

+  0,0 

21,6 

21,5 

21,0 

21,1 

8.378 

-3,8 

7.824 

6,6 

7.445 

4,8 

7.650 

+  2,8 

112,0 

890 

104,4 

101,7 

165 

780 

0 

393 

21,0 

8.120 

103,8 

0 

160 

20,9 

8.200 

+  1,0 

104,9 

0 

0 

447 

1.244 

+  373 

1.011 

0 

7.553 

21,8 

8.705 

115,3 

1.027 

766 

1  Net  Production  = Total  Slaughterings 
2  Gross  Internal  production  = Net  Production  -  Live  Animal  Balance 

ANNEX Vil 

EU SPECIAL PREMIUM MALE BOVINE ANIMALS 
UE PRIME SPECIALE BOVINS MALES 
EU SONDERPRÂMIE MÂNNLICHER RINDER 

Number of bovine animals having received the premium (R. (EEC) No. 468/87 and 805/68) 
Nombre de bovins ayant bénéficié de la prime (R. (CEE) N* 468/87 et 805/68) 
Anzahl der Rinder, fûrwelche die Pramie gewâhrtwurde (R. (EWG) Nr. 468/87 und 805/68) 

1993 

£2ndage 

Of 
which 
;builèy 

1st age 

1994(a) 
2nd age, 

Belglque/BelglS 

Danmark 

331.487 

335.493 

223.842 

295.489 

48.376 

7.998 

np 

np 

236.202 

287.058 

49.799 

10.568 

Deutschland ('90) 

2.582.833 

884.277  ** 

393.634 

369.839 

1.784.041 

438.723 

of which 
iulls; 

48.311 

8.682 

421.127 

Ellas 

Espafia 

France 

Ireland 

Italia ('91) 

Luxembourg 

Nederland('91) 

Portugal 

143.337 

536.584 

2.262.064 

1.547.651 

794.000 

21.593 

281.797 

141.930 

122.606 

460.151  •• 

6.330 

32.466 

1.580.917 

633.393 

544.286 

1.137.958 

533.033  § 

25.326  § 

16.813 

223.789 

140.000 

3.875 

8.809 

16.565 

683.272 

np 

np 

np 

np 

np 

np 

00 

np 

137.092  §§ 

6.500  §§ 

6.000  §§ 

520.220 

1.726.033 

959.138 

629.191 

19.999 

166.244 

.154.897 

27.840 

479.723 

816.301 

24.771 

4.803 

13.023 

19.568 

27.720 

272.769 

3.279 

24.771 

2.031 

13.023 

19.568 

23.515 

13.652 

1.380.183 

745.131 

United Kingdom ('91) 

1.381.234 

1.404.041 

ôsterrelch 

Suoml/Flnland 

Sverlge 

B tf2;998:002; 

x-Wt----;w 

8.000F298 i  &636V75o|â;:  ^87b'796'^'\| 

<11.516;981 

•••A*.-*:------

Legend: 

§  Provisional figures  -  §§ =  Estimated figures  -  np= not provided 
*  Does not include new Lflnder (NBL) or Canarias  -  "  = including NBL or Canarias 

Underlining  Proportional reduction applies due to regional ceiling being exceeded (e.g.  1993 UK claims for first age bracket = 1.857.372 head) 

(a)  Provisional figures. In the case of DK and NL the figures refer to applications. 
(b)  Provisional ceiling for 1993-94, including rights of NBL (780.000) for DE and Canarias (25.000) for ES 
(c)  Ceiling as amended by Reg. No.  1884/94. 

Ceiling 
1993-94(b) 

Ceiling 
1995(c) 

331.487 

335.493 

293.211 

324.652 

3.653.183 

3.092.667 

143.337 

561.584 

2.262.064 

1.547.651 

834.848 

21.593 

264.000 
141.9301 

140.130 

551.552 

1.908.922 

1.286.521 

824.885 

19.300 

264.000 

154.897 

1.419.811 

1.419.811 

423.400 

250.000 

250.000 

16'.280.548 

11.203.948 

5D 

ANNEX Vlll 

EU SPECIAL  PREMIUM MALE  BOVINES: PREMIUMS  AND  PRODUCTION 
UE PRIME SPECIALE  BOVINE: PRIMES  ET  PRODUCTION 
EU RINDERSONDERPRAMIE: PRÀMIEN UND  ERZEUGUNG 

Member  State 

Year 

Number  of  head  (x1000) 

Percentage 

Production 

Premiums 

Ceilings 

België/Belgique 

Danmark 

' 

Deutschland 

Ellas 

Espafia 

France 

Ireland 

Italia 

Luxembourg 

Nederland 

Portugal 

United  Kingdom 

EU TOTAL 

Legend: 

92 
93 
94 
92 
93 
94 
92 
93 
94 
92 
93 
94 
92 
93 
94 
92 
93 
94 

92 
93 
94 
92 
93 
94 
92 
93 
94 
92 
93 
94 
92 
93 
94 
92 
93 
94 
92 
93 
94 

| 
I 
! 

1 
j 
| 

(a) 
(b) 
(c) 

(a) 

310.8 
320,7 
315.9 
433.2 
400.0 
355.7 
2.774.3 
2.328,1 
2.082.0 
201.2 
186,5 
183.6 
1.144.9 
1.023,5 
876,0 
1.673.1 
1.482.9 
1.397.7 
939.1 
828.2 
650.0 
2.330,6 
2.194,3 
2.124,4 

8.5 
9,0 
8.8 
488,7 
434.0 
437.9 
247.2 
245.5 
211,9 
1.675.3 
1.486,9 
1.539.8 
12.216.0 
10.939,7 
10.183,7 

(b) 

331,5 
223.8 
236.2 
335.5 
295,5 
287.1 
2.582.8 
884.3 
1.784.0 
143.3 
122.1 
137.1 
536.6 
460,2 
520.2 
2.262.1 
1.580.9 
1.726.0 
1.547.7 
544.3 
959,1 
794.0 
533,0 
629,2 

I 
j 
| 

j 
j 
; 
| 
i 
j 
! 
! 
! 
i 
j 
I 
j 

i 
; 
i 
i 
| 

i 
j 
| 
! 

21.6 
16.8 
20.0 
281.8 
223.8 
166.2 
.  | 
141.9 
| 
140.0 
! 
154.9 
! 
1.381,2 
j 
1.404,0 
I 
1.380.2 
! 
!  10.360,0 
6.429,2 
| 
j 
8.000,3 
I 

1993-94 

1995 

331.5 

293.2 

335.5 

324.7 

3.653.2 

3.092.7 

143.3 

140,1 

561.6 

551,6 

I 
| 
| 

i 
| 

i 
| 

! 

j 

! 
i 
| 

j 

2.262,1 

1.908,9 

| 

1.547,7 

1.286,5 

| 

| 

834.8 

824.9 

21.6 

19.3 

264.0 

264.0 

141,9 

154.9 

1.419.8 

1.419,8 

11.517.0 

10.280,5 

(c) 

106.7 
69,8 
74.8 
77,4 
73,9 
80,7 
93.1 
38.0 
85,7 
71.2 
65,5 
74,7 

46,9 
45,0 
59,4 

135,2 
106,6 
123.5 
164,8 
65,7 
147.6 
34,1 
24,3 
29,6 
254,1 
186,7 
227,3 
57,7 
51,6 
38,0 
57,4 
57,0 
73,1 
82,4 
94,4 
89.6 
84,8 
58,8 
78,6 

Eurostat = Net Production (slaughterings) of bullocks+bulls. 
Animals receiving first age bracket premium (provisional). 
(a/b x 100) = % of animals receiving premium, in relation to animals  slaughtered 

ANNEX  IX 

BEEF DESEASONALIZATION  PREMIUM 
PRIME BOVINE A LA  DESEASONNALISATION 
SAISONNEUTZERRUNGSPRÀMIE IN  RINDFLEISCHSEKTOR 

9 

Member3State - 

-2&C±K  ïx^X'ëàrM  vNurriberidf Bullocks  :*%jot bullocks slaughtered 

.Number of animals 

!ïMÊ$&^'-ÏÏ 

'••'"£'  -•%!':-rr'^M^ 

^ ^ ^ ^ ^ ^ ^ ^ I Ê Ê ^ ^ ^- 

Jan-Apr  - 

receiving premium 

Ireland 

Northern Ireland (UK) ** 

Deutschland 

Danmark 

EU TOTAL 

Legend: 

923.200 

926.600 

813.200 

631.300 

235.000 

250.000 
206.000 
219.000 

46.200 

47.000 
39.900 

41.000 

4.500 
4.800 

4.600 
5.200 

48,0 

49,6 

40,8 

41,2 

44,0 

40,2 
28,7 
28,9 

78,0 

74,4 
62,5 

55,7 

90,0 
72,9 

65,0 
46,0 

24,9 

23,2 

32,7 

35,7 

27,4 

30,6 
42,0 
40,7 

8,5 

10,9 
20,6 

29,0 

-

12,5 

19,6 
44,2 

1991 

1992 

1993 

1994 

1991 

1992 
1993 
1994 

1991 

•  1992 
1993 

1994 

1991 
1992 

1993 
1994 

1993 

1994 

239.456 

195.331 

90.617 
86.835. 

9.533 

13.384 

692 
1.886 

340.298 

297.436 

Eurostat = Net Production (slaughterings) of bullocks i 
UK information 

| 

| 

figures rounded). 

n 
n 

ANNEX X 

BEEF PREMIUMS IN GERMANY (1989-95) 
PRIMES BOVINES EN ALLEMAGNE (1989-95) 
RINDERPRAMIEN IN DEUTSCHLAND (1989-95) 

g ^ ^ l ^ p ^ p f a n l m a j ^^ 

^ ^ ^ ( x l p o p ^ h ê a ç i ) ^ ^^ 

Uy^M&$& 
1989 

ï ^ ^ g ^ N ë ue  Bundeslànder  ;:/..; 

^&J..u£\ 

1992 

1993 

1994 

1995(d) 

••^;ifev-:>,>-^^^^ 
1989 

1992 

- 

1993 

1994 

•' 

Males  - stocks > 6 months (a) 

1271,6 

- premiums -1 st age (b) 
- 2nd age bracket 

Cows  - stocks dairy herd (a) 

- stocks suckler herd (a) 

(c)  - suckler cow premiums 

-

-

-

1958.0 

16.6 

475,5 

177,9 

n.a 

1036,0 

98,7 

91,7 

420,2 

230.8 
94.9 

1058,3 

119.2 

114,4 

407,0 

252,2 

88,1 

1041,2 

166.2 

144.1 

2941,0 

0.0 

6886.0 

281.0 

81.0 

400,0 

-

179,3 

2665,0 

2582,8 
n.a. 

4329,2 

408,4 

336,2 

2648,0 

630,5 

275,0 

4242,7 

433,6 

298,8 

2508,7 

1531,8 

350,7 

4232,1 

457,0 

361,6 

Legend: 

NBL=Neue Bundeslànder; ABL=Alte Bundeslànder; D=Deutschland;  n.a.= not applicable. 

(a) 

(b) 

(c) 

(d) 

December livestock census 

Male Regional ceilings (1995): NBL=660.323;  ABL=432.344; D=3.092.667 

Suckler Cow ceilings: NBL=180.000; ABL=471.122; D=651.122 

Estimated applications for 1995 

' 

ANNEX XI 

EWE PREMIUM CLAIMS IN  GERMANY (1989-95) 
DEMANDES A LA PRIME OVINE EN ALLEMAGNE (1989-95) 
MUTTERSCHAFPRAMIENANTRAGE  IN DER BRD (1989-95) 

• * . * . -; 

. • ' : • . ' , ' • : ' • ' . . • • _ .: 

Neue Bundeslànder 

Year 

1989 

1990 

1991 

1992 

1993 

1994 

1995 

Breeding ewes In census 
Ewes for which premium  claimed 
Number of  producers 
Average claim per  producer 

1.040.849 

-
-
-

799.584 
611.852 

533.342 
638.919 
5.639 
113 

471.234 
550.573 
4.329 
127 

473.388 
521.703 
3.630 
144 

486.211 
528.135 
3.768 
140 

-
553.805 
3.806 
146 

* 

"-*•. -/a*;v  ' *V:.*•••"*•'** % 

,.,,. ,,; .. 

Alte Bundeslànder 

Year 

1989 

1990 

1991 

1992 

1993 
% 

1994 

1995 

Ewes for which premium  claimed 
Number of  producers 
Average claim per  producer 

1.267.825 
27.051 
47 

1.427.358 
29.247 
49 

1.423.928 
29.152 
49 

1.362.015 
28.392 
48 

1.230.699 
25.474 
48 

1.239.463 
24.079 
51 

1.199.121 
22.358 
54 

.

.. 

. 

. 

••- 

•:^.- 

'-:r:L> 

•W'--  ;-.-•:•'• 

Deutsche E 

lundesrepubl 

k 

Year 

1989 

1990 

1991 

1992 

1993 

1994 

1995 
_ 

Ewes for which  premium  claimed 
Number of  producers 
Average claim  per  producer 

1.267.825 
27.051 
47 

2.039.210 
29.247 
70 

2.062.847 
34.791 
59 

1.912.588 
32.721 
58 

1.752.402 
29.104 
60 

1.767.598 

27.8471 
631 

1.752.926 
26.164 
67 

•^ 
^ 

9l 

No 1 

Price proposals in ecus for individual  products 

Product and type of price or amount 
(Period  of  application) 

1995/96 Decisions 

Proposals  1996/97 

Amounts 
in ECU/t 

% change 

Amounts 
in ECU/t 

%  change 

1 

2 

3 

4 

5 

Cereals 
-  Intervention  price 
-  Compensatory  payment  (1) 

1.7.96-30.6.97 

119.19 
54.34 

-7.4 
*  +28.6 

119.19 
54.34 

0 
0 

Rice 
-  Intervention  price - paddy rice 

1.9.96-31.8.97 

373.84 

0 

351 

-6.11 

Sugar 
-  Basic price for sugar beet 
-  Intervention price for white sugar (2) 

1.7.96-31.8.97 

1.11.96-31.10.97 

Olive oil 
-  Producer target price 
-  Intervention  price (3) 
-  Representative market price 
-  Production aid 
-  Consumption  aid 

47.67 
63.19 

3,837.7 
1,919.2 
2,295.0 
1,422.0 
120.7 

47.67 
63.19 

0 
0 
0 
0 
0 

3,837.7 
1,919.2 
2,295.0 
1,422.0 
120.7 

0 
0 
0 
0 
0 

(1)  To be multiplied by the customary  regional  cereals yield to obtain the payment in ECU/ha. 
(2)  ECU/100 kg. 
(3)  After application of the adjustment due to the maximum guaranteed threshold being exceeded. 

if 

No 2 

Price proposals in ecus for individual products 

Product  and type of price or amount 
(Period  of  application) 

1995/96 Decisions 

Proposals  1996/97 

Amounts 
in ECU/t 

%  change 

Amounts 
in ECU/t 

%  change 

1 

2 

3 

4 

5 

1.8.96-31.7.97 

1.8.96-31.7.97 

1.4.96-31.3.97 

1.9.96-31.8.97 

1.7.96-30.6.97 

Linseed 
-  Fixed-rate aid (fibre)  (per ha) 

Hemp 
-  Fixed-rate  aid (per ha) 

Silkworms 
-  Aid per box of silk seed 

Cotton 
-  Guide price 
-  Minimum  price 

Milk 
-  Target price 

Butter 
-  Intervention  price 

Skimmed-milk powder 
-  Intervention  price 

935.65 

774.74 

0 

0 

935.65 

774.74 

133.26 

-0.05 

133.26 

1,063.0 
1,009.0 

309.8 

3,282 

2,055.2 

0 
0 

0 

0 

0 

-

309.8 

3,282 

2,055.2 

0 

0 

0 

-

0 

0 

0 

Beef/veal 
-  Guide price for live adult bovine animals 
-  Intervention price R3 carcases 

1.7.96-30.6.97 

-  Male bovine animal premium (calendar year) (1) 
-  Suckler cow premium (calendar year) (1) 

2,383.9 
3,475.0 

1995 

108.68 
144.90 

0 
-5.5 

+20 
+26 

3,475.0 

1996 

108.68 
144.90 

Sheepmeat 
-  Basic price (carcase weight) 

2.1.96-1.1.97 

5,040.7 

0 

5,040.7 

0 

(1)  In ECU/head. The required density changes from LU 3 to 2,5/ha. The other premiums (deseasonaliaztion, calf 

conversion, extensification)  are maintained at the level  set in the May  1992 reform. 

5^ 

No 3 

Price proposals in ecus for individual products 

Product  and type  of price or amount 
(Period  of application) 

1995/96 Decisions 

Proposals  1996/97 

Amounts 
in  ECU/t 

%  change 

Amounts 
in  ECU/t 

%  change 

1 

2 

3 

4 

5 

Pigmeat 
-  Basic  price  (carcase  weight) 

1.7.96-30.6.97 

1,509.39 

-3.8 

1,509.39 

Fruit  and vegetables - Basic  price 
-  Cauliflowers 
-  Tomatoes 
-  Peaches 
-  Lemons 
-  Pears 
-  Table grapes 
-  Apples 
-  Mandarins 
-  Sweet  oranges 
-  Apricots 
-  Aubergines 
-  Clementines 
-  Satsumas 
-  Nectarines 

Table wine (1) 
-  Guide price Type R I 
-  Guide price Type R II 
-  Guide price Type R HI 
-  Guide price Type A I 
-  Guide price Type A II 
-  Guide price Type A IE 

Tobacco  (Premiums) 
Flue  cured 
I. 
H. 
Light  air cured 
HI.  Dark  air cured 
IV.  Fire  cured 
Sun cured 
V. 
VI.  Basmas 
VQ.  Katerini 
VIE.  Kaba  Koulak 

1.5.96-30.4.97 
11.6.96-30.11.96 
1.6.96-30.9.96 
1.6.96-31.5.97 
1.7.96-30.4.97 
1.8.96-20.11.96 
1.8.96-31.5.97 
16.11.96-28.2.97 
1.12.96-31.5.97 
1.6.96-31.7.96 
1.7.96-31.10.96 
1.12.96-15.2.97 
16.10.96-15.1.97 
1.6.96-30.8.96 

1.9.96-31.8.97 

0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 

0 
0 
0 
0 
0 
0 
0 
0 

-

3,828 
3,828 
62,150 
3,828 
82,81 
94,57 

2.709,65 
2.167,48 
2.167,48 
2.383,62 
2.167,48 
3.754,15 
3.185,41 
2.276,15 

-

3,828 
3,828 
62,150 
3,828 
82,81 
94,57 

2.709,65 
2.167,48 
2.167,48 
2.383,62 
2.167,48 
3.754,15 
3.185,41 
2.276,15 

(1)  R I, R II and A I expressed in ECU/%/hl. 
R in,  A n  and A III expressed in ECU/hl. 

0 

0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 

0 
0 
0 
0 
0 
0 
0 
0 

STABILIZERS  AND PRODUCTION  THRESHOLDS 

Quotas or MGQ 
applicable 

SUGAR 
(WHITE  SUGAR 
EQ.) 

EUR-12 
QuoU A:  11  187 Mt 
QuoU B: 2  488 Mt 

ISOGLUCOSE 

EUR-12 
QuoU A: 240 743 t 
QuoU B: 50 342 t 

INULIN  SYRUP 

1994/1995 

Market situation 

Overrun 

EUR-12 production  in 
Mt 
QuoU A:  10 897 
QuoU B: 2 406 
Sugar C: 2 225 
ToUl:  15 528 

Production within 
quotas 

QuoU or quantity' 
applicable/proposed 

EU-15 
QuoU A:  11974Mt 
QuoU B: 2 609 Mt 

EU-15 
QuoU A: 251  588t 
QuoU B: 51  4271 

EU-15 
QuoU A: 261  562 t 
QuoU B: 61  5981 

1995/1996 

Market  situation 

Overrun 

EU-15 production  in  . 
Mt(e) 
QuoU A:  11 721 
QuoU B : 2 420 
Sugar C: 2 030 
ToUl: 16 180 

EU-15 production  (e) 
QuoU A: 251,5881 
QuoU B:  51,4271 

C : 0t 

EU-15 production  (e) 
QuoU A:  127 0001 
QuoU B: 0 t 
QuoU C  :  01 

1996/1997 

QuoU or quantity 
applicable/proposed 

EU-15 quotas 
unchanged 

EU-15 quotas 
unchanged 

EU-15 quotas 
unchanged 

OLIVE OIL 

EUR-12MGQ: 
1 350 000 t 

Estimated production: 
1 408 023 t (Reg. 
2540/95) 

Final production 
94/95  will be fixed  in 
July  1996 

Same MGQ as  for 
1994/95: 
1 350 000 t 

Production  (e): 
1 230 000 t 

No  overrun 
expected 

EU-15 MGQ: 
1 350 000 t 

WINE 

No compulsory 
distillation 

Compulsory distillation: 
Price based on the 
quantity covered by the 
compulsory-distillation 
schemes, as follows: 50% 
of the guide price for the 
equivalent of  10% of the 
volume used; 7.5% of that 
price for the remainder 

Exceptionally short 
crop. Strong prices. No 
compulsory  distillation 
announced so far. 
Question to be 
reviewed  by the end of 
February  1995 

TOBACCO 

EUR-12quoU: 350  000  1 
ofleaf tobacco. 
Allocated by variety 

Production  within the 
quotas 

Compulsory  distillation: 
Price based on the  quantity 
covered  by the 
compulsory-distillation 
schemes, as follows: 50% 
of the  guide price for the 
equivalent  of  10% of the 
volume used; 7.5% of that 
price  for the  remainder 

EU-15 overall  quota: 
350  600 t  allocated  by 
variety  and group of 
varieties. 

Still short crop. Strong 
prices, especially  in 
Italy. 
No compulsory 
distillation.  Definitive 
decision  by the end  of 
February  1996 

Probably no 
compulsory 
distillation will be 
decided 

Reform  under 
discussion. 
Probably no change  for 
this  year 

Production  within the 
quotas 

No change  scheduled 

or 
r 

Quotas or MGQ 
applicable 

1994/1995 

Market situation 

Overrun 

QuoU or quantity 
applicable/proposed 

1995/1996 

Market  situation 

Overrun 

1996/1997 

QuoU or quantity 
applicable/proposed 

COTTON 

MGQ:  701  000 t 

EUR-12 production: 
1 318011 

Reduction of aid: 
23.843 ECU/100 kg 
in 1994/95 

MGQ:  1031  0001 
Spain: 249 000 t 
Greece: 782  0001 

Estimated  production: 
Greece:  1 250 000 t 
Spain: 97  5001 

Reduction  of aid: 
Greece: 40% 
Spain: 0% 

MGQ:  1  031 0001 
Spain: 249 000 t 
Greece: 782 000 t 

FRESH TOMATOES 

EUR-12  intervention 
threshold: 600  800 t 

Withdrawals: 50 220 t 

No overrun 

EU-15  intervention 
threshold: 607 200 t 

Withdrawals 
(provisional): 20  0001 

CAULI-FLOWERS 

EUR-12  intervention 
threshold: 64 300 t 

Withdrawals:  194 3191 

Overrun:  5% 

NECTARINES 

EUR-12  intervention 
threshold: 83  100 t 

Withdrawals:  191  523 t 

Overrun: 20% 

PEACHES 

EUR-12  intervention 
threshold: 303 600 t 

Withdrawals: 799 262 t 

Overrun: 20% 

APPLES 

Intervention threshold 
EUR-12: 257  800 t 
EU-15: 260  000 t 

Withdrawals: 629 014 t 

Overrun:  9% 

ORANGES 

EUR-12  intervention 
threshold:  1 179 900 t 

Withdrawals: 220  659 t 

Overrun: 9% 

Withdrawal: n.a. 

Withdrawal: n.a. 

Withdrawal: n.a. 

Withdrawal: n.a. 

Withdrawal:  n.a. 

EU-15 intervention 
threshold: 63 800 t 
(3%  of  average  quantity 
produced  for  consumption, 
not including  products  for 
processing,  in the  last  five 
years) 

EU* 15 intervention 
threshold: 90 800 t 
(10% of  average  quantity 
produced, same basis as 
for  cauliflowers) 

Intervention  threshold: 
304 600 t 
(12% of  average  quantity 
produced,  same basis  as 
for  cauliflowers) 

Intervention  threshold: 
281 200 t 
(3%  of  average  quantity 
produced, same basis as 
for  cauliflowers) 

Intervention  threshold: 
1 202 000 t 
(10% of average  quantity 
produced  in the  last  five 
years plus 752 392 t) 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion  at the 
Council 

LEMONS 

Quotas or MGQ 
applicable 

EUR-12 intervention 
threshold: 363  0001 

1994/1995 

Market situation 

Overrun 

Withdrawals: 6 476 t 

Overrun: 10% 

SATSUMAS 

EUR-12  intervention 
threshold:  177 200 t 

Withdrawals: 589 t 

No overrun 

CLEMENTINES 

EUR-12 intervention 
threshold:  130 600 t 

Withdrawals: 40  8801 

No overrun 

MANDARINES 

EUR-12  intervention 
threshold: 36 300 t 

Withdrawals: 4 4971 

Overrun:  2% 

PROCESSED 
TOMATOES 

DRIED GRAPES 

ToUl Quota: 
concentrate: 4 317  339 t 
peeled:  1 543 228 t 
others: 736  220 t 

Maximum  Guaranteed 
Area Currants, Sultanas 
and Moscatel: 53 000 ha 

WILLIAMS  PEARS 

EUR-12  guaranteed 
threshold:  102 805 t 

PEACHES  SYRUP 

EUR-12 guaranteed 
threshold: 582 000 t 

No overrun 

Overrun: 3.25% 

No overrun 

QuoU or quantity 
applicable/proposed 

Intervention  threshold: 
361 6001 (10% of average 
quantity produced  in the 
last five yean  plus 
250  9931 

Threshold:  176 8001 
(10% of average quantity 
produced' in the last five 
yean  plus  150 0001) 

Intervention  threshold: 
128 6001 
(10% of average quantity 
produced  in the last five 
yean) 

Intervention  threshold: 
36 300  t 
(10% of average  quantity 
produced  in the last  five 
yean) 

ToUl Quota: 
concentrate: 4 317 339 t 
peeled:  1 543 2281 
others: 736 220 t 

Maximum  Guaranteed 
Area Currants, Sultanas 
and Moscatel:  53 000 ha 

Same thresholds  as in 
1994/95 
EU-15:  102  805 t 

Same thresholds  as in 
1994/95 
EU-15:  582  0001 

1995/1996 

Market situation 

Overrun 

Withdrawal: n.a. 

-

1996/1997 

QuoU or quantity 
applicable/proposed 

Reform  under 
discussion  at the 
Council 

Withdrawal: n.a. 

Withdrawal: n.a. 

Withdrawal: n.a. 

Withdrawal: n.a. 

Withdrawal: n.a. 

Withdrawal: n.a. 

Overrun:  17.84% 

Withdrawal: n.a. 

No  overrun 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion at the 
Council 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion  at the 
Council 

Maximum  Guaranteed 
Area Currants, Sultanas 
and  Moscatel: 
53 000 ha 

Reform  under 
discussion  at the 
Council 

Reform  under 
discussion  at the 
Council 

i) 

MILK 

Quotas or MGQ 
applicable 

EUR-12 quoU 
Wholesales  quoU: 
107 062  3021 
Direct sales quoU: 
1 983  6271 

1994/1995 

Market situation 

Overrun 

-

No EU overrun, but 
overrun in Belgium, 
Denmark, Greece, 
Ireland, 
Luxembourg, The 
Netherlands and 
United Kingdom: 

QuoU or quantity 
applicable/proposed 

EU-15  quoU: 
Wholesales  quoU: 
114 909  3021 
Direct sales  quoU: 
2  363  6271 
("SLOM" quantities  for 
new Member States  : 
380 0001) 

1995/1996 

Market situation 

Overrun 

No EU overrun 
expected but 
possible  overrun 
on a few  MS 

1996/1997 

QuoU or quantity 
applicable/proposed 

EU-15 quota: 
Wholesales  quoU: 
114 909 302 t 
Direct sales quoU: 
2 363  6271 
("SLOM" quantities  for 
new Member  Sûtes 
380 0001) 

o 

TRENDS IN ECONOMIC INDICES FROM 1980 TO 1994 IN REAL TERMS 
-EUR12-
Index based on 1989-90-91 = 100 

.",": 

YEARS 

1980 
1981 
1982 
1983 
1984 
1985 

'.  .1986 
1987 
1988 
1989 
1990 
1991 
1992 
1993 
1994 

' 

Expenditures 
EAGGF-
Garantee 
(D(5j. 

•'. 
• 

' 

70.8 
;  62.9" 
.64.8 
•  78.0 
85.S 
88.1 
.96.5  . 
97.8 
108.9, 
'95.4 
94.1 
110.5 
106.8 
.118.0 
*1"11.3 • 

GDP 
total 

V  (2). 

.  78.9 

7 8 . 9 ./ 
79.7 
81.0 
82.9 
.84.9  ' 
87.4 
89.9 
93.7 
97.2 
100.1 
102.7 
103.9 
103.5 
106.5. 

Final  • 
' agricult. 
output 
(2) 

Employm. 
in 
agric' 
InAWU' 

Final agric. 
output per 
pers. empl. 
(2) 

NVA 
agric. 

NVA 
perAWU 

Support 
prices 

Producer 
prices 

(1) 

(D 

(3) 

(4) 

Prices of 
Intermediate 
consumption 
(4) 

* 89.4  .. 
88,0 
'92.7 
93.4 
95.4 
95.6 
96.6 
97.6 
• .98.2  ' 
99.3 
99.4 
'  100.6' 
103.3 
100.7 
99.8 

'136.7 
130.1 
1.25.6 
123.6 
121,1 

,118.5* 

115.0. • 
112.1 
108.7 
•103.6-
102.8 
'97.2  " 
92.2 
87.4 
'  85.1 

' 

65.4 * 
67.6 
73.8 * 
75.Ô  .: 
78.8 
8Ô.7 
84.0 
87.1 
90.3 
95.8 
'96.7 
•103.5 
112.0 
.'115.2 
117.3 

• 

114,5  • 
110.2 
117,5 
111.5 
112.1 
105.9 
103.8 
98.9  • 
98.1 
104.5 
101.5 
.  98.5 
92.2 
a7.8 
91.0 

83.8 
84.7 
93.6 
90.2-
92.6 
89,4 
90.3 
88.2 
90.2 
1*00.9 
'  98.7 
101.3 
100.0 
100.5 
106.9 

; 

132.6 
134.4 
.135.7 
132.1 
126.8 
123.6 
'  1.19.1 
111.5 
107.2, 
104.4 
'  100.4 
95.2-
90.3 
94.0  • 
87.8. 

129.2 
130.3 
127.6 
124.6 
'  122.0 
116.7 
110.8 
105.4'. 
103.7 
105.1 
.102.2 
97.8. 
•  89.3 
84.8 
85.4 

127.2 
131.1 
128.9 ;•; 
129.0 
129.8 
'  124.1  . . 
115.9 
106.2 
104.8 
.  104.2 
101,3 
98.7 
95.4 
94.6 
92.4 

(1) In real terms (GDP deflator). 
(2) Fn constant prices. 
(3) Weighted-average, for products with common prices, of support prices (Intervention price or equivalent); 

. 

irt national currency real terms (GDF? deflator). 1989-90-91 = 100. 

(4) Weighted average of allproducts and intermediate consumption In ECU, EUR-10, deflated by the'consumer Index. 
(5) 

Budget 1987: from 1st January to 31 st October .1987. 
Budget 1988 : from 1st november 1987 to 15st October 1988. 
from Budget 1989 : from 16th octoberyearn to 15th.october year n+1. 

GDP : Gross Domestic-Product at market prices. 
NVA : Net Value Added*at factor cost. 
AWU: Annual Work Unit 

^ 

l.i 

Net Value-Added and Employment 
Agricultural indices in real terms (1989-90-91 = 100) 
P.P.6.5 

140 

130 

^ 

120 

110 

100 

90 

'*•••-*. Annual Work  Unit  (AWU) 

•

•

*. 

^ —— 

* <A« a • •  m m " •* » » » 

• 

r. 
• • • ^ # «* 

. • » •• 

j 

0 

4* 

80 

1980  1982  1984  1986  1988  1990  1992  1994 
1981  1983  1985  1987  1989  1991  1993 

Trends in a^icultural economic indices 
in real terms (1989-90-91 = 100) 

P.P. 6.5 

130 

120 

110 

100 

90 

80 

70 

60 

1980  1982  1984  1986  1988  1990  1992  1994 
1981  1983  1985  1987  1989  1991  1993  u 

ural price indices 
in real terms (1989-90-91 = 100) 

o 

P.P. 6.5 

Support Prices  Prod. Prices  jnterm. Cons. Prices 

.-'....•.. 

• • . " • •. 

140 

130 

120 

110 

100 

90 

80 

70 

1980  1982  1984  1986  1988  1990  1992  1994 

ISSN 0254-1475 

COM(96) 44 Vol. I 

DOCUMENTS 

EN 

03 

Catalogue number  :  CB-CO-96-068-EN-C 

ISBN 92-78-00566-5 

Office for Official Publications of the European Communities 

L-2985 Luxembourg