CELEX: 51977PC0339
Language: en
Date: 1977-07-19
Title: Proposal for a REGULATION (EEC) OF THE CODICIL laying down special measures in respect of cast or seeds (submitted to the Council by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (77) 339
Vol. 1977/0113
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 ---pagebreak---    COMMISSION OF THE EUROPEAN COMMUNITIES
                                                       COM(77)339 final.
                                                       Brussels . July 19 . 1977
                                  Proposal for a
                        REGULATION (EEC ) OF THE CODICIL
           laying down special measures in respect of cast or seeds
                  ( submitted -to the Council by the Commission)
           Report from the Cooaission to the Counoil on the advisability
           of pronoting oastor seed produotion in the Oonmunity
C0M(77) 339 final .
 ---pagebreak---                                        Proposal for a
                                                                                            !
                 REGULATION ( EEC ) No      / 77 OF THE COUNCIL
                 of
 laying down special measures in respect of castor seeds
 THE COUNCIL OF THE EUROPEAN COMMUNITIES /
 Having regard to the Treaty establishing the European Economic Community, and in
particular Article A3 thereof .
 Having regard to the proposal from the Commission ,
 Having regard to the Opinion of the Eurcpean Parliament ,
Having regard to the Opinion of the Economic and Social Committee ,
 Whereas castor seed production is becoming of increasing importance to the Commu­
nity ; whereas to promote this production , which is in direct competition with castor
 seeds imported duty free from non-member countries , appropriate support measures
 should be introduced ;                                                     ,
Whereas , to this end , on the disposal of their crops to the market , Community produ­
 cers must be guaranteed a fair return , the' level of which can be defined by a guide
price ; whereas the difference over a representative period between this price and
the price of castor seeds on the world market represents        the amount of aid
 which must be granted to attain the desired objective ;
Whereas , to facilitate the application of this system , the aid should be granted
to seed processing undertakings ; whereas , so that the producers may "benefit from such aid
the granting thereof should be made subject to the conclusion with the former of
                                                                                (
 contracts providing for a minimum purchasing price ;
Whereas provision should "be made for the Community to bear , under the rules governing
the financing of the common agricultural policy, the expenditure incurred "by the
Member States as a result of the obligations arising out of the operation of this
Regulation ,
HAS ADOPTED THIS REGULATION S
 ---pagebreak---                                              - 2 -
                                        Article 1
 1 . 8efore 1 August each year, in respect of the marketing year commencing the following
      year there shall be fixed for the Community, in accordance with the procedure laid
       down in Article 43 ( 2) of the Treaty, a guide price for castor seeds falling within
   1 heading No 12.01 of the Common Customs Tariff .
      However , for the marketing year 1978/79 this price shall "be fixed before 1 April 1978 .
      It shall be fixed at a fair level for producers having regard to the Community 's     1
      supply requirements .
 2. The guide price shall remain in force throughout the marketing year ; this shall
      cover the period from 1 October to 30 September . .
3. The guide price shall refer to a standard quality . This quality shall be defined
     by the Council in accordance with the procedure referred to in paragraph 1 .
                                         Article 2
1 . When the guide price for a marketing year is higher than the world market price for
     castor seeds , as determined in accordance with Article 3 an aid equal to the diffe­
     rence between these two prices shall be granted for castor seeds harvested and pro­
     cessed in the Community .
2 . The aid shall be granted only to seed processing undertakings which :
    - meet the conditions laid down for entitlement to the aid , and
     - have concluded with castor seed producers oontracts stipulating a minimum price .
     This minimum price shall be fixed at a level guaranteeing sales for seed producers
     at a price as close as possible to the guide price , taking into account market
     fluctuations and the cost of transporting the seeds from the production areas to the
     processing areas .
3 . The aid shall be paid by the Member State on whose territory the seeds are processed .
A. The Council , acting by a qualified majority on a proposal from the Commission ,
     shall each year , in good time before the beginning of the marketing year , fix the
     minimum price referred to in paragraph 2 .
     The same procedure shall be used to lay down :
     (a)      . general rules for granting the aid ;
            detailed rules for checking entitlement to the aid ; such checking arrangements may
            anply "both to seeds harvested within the Community and to seeds imported from non–
          - member countries ; in the case of the latter those arrangements may include provisii
            for the lodging of a security ;
     ( c ) the conditions referred to in the first indent of paragraph 2 .
5 . The amount of the aid shall be fixed by the Commission .
6 * Detailed rules for the application of this Article , particularly in respect of the stan <
    provisions which the contracts referred to in paragraph 2 must contain , shall be
 ---pagebreak--- determined in accordance with the procedure Laid down in Article 38 of Regulation
No 136/ 66/ EEC of 22 Septwiber 1966 on the establishment of a common organization of
                               (1)                                                            "
the market in oils and fats
                                                                                            . !
                                                                                              i
                                     Article 3
The world market price for castor seeds , calculated at a frontier crossing point
in the Community, shall be determined on the basis of the most favourable purchasing
possibilities during the most representative period for the' sale of seeds of Community
origin . The Council , acting by a qualified majority on a proposal from the Commis­
sion , shall lay down the criteria for determining the average world market price .
Detailed rules for the application of this Article shall he determined in accordance _1
with the procedure laid down in Article 38 of Regulation No 136/66/EEC .
                                     Article 4
The Member States and the Commission shall exchange all information necessary for ihe imple­
mentation     of this Regulation . Retailed rules concerning the nature , provision and^_
 circulation of such information shall he drawn up in accordance with the procedure
 laid down in Article 38 of Regulation No 136/66/EEC .
                                     Article 5
The provisions concerning the financing of the common agricultural policy shall
apply to the aid (arrangements provided for in this Regulation .
                                     Article 6
This Regulation shall enter into force on the third day following its publication
in the Official Journal of the European Communities .
The aid arrangement's provided for in "this Regulation shall apply with effect from       •
1 October 1978 .
This Regulation shall be binding in its entirety and directly applicable in cLl
Member States .
Done at                                                     For the Council
( 1 ) OJ No 172 , 30.9.1966 , p. 3025/ 66
 ---pagebreak--- The promotion of castor bean cultivation in the Community
At its meeting on 25/ 26 April 1977 , the Council took note of the Commission 's
commitment to examine the advisability of promoting castor seed production in the
Community and to submit a report to it in the subject before 1 July 1977 , accom­
panied if need be by appropriate proposals .
This document constitutes the report in question and also serves as the explanatory
memorandum to a proposal for a Council Regulation laying down special measures for
castor seeds .
Having undertaken the examination in question , the Commission considers that it
is in the Community 's interest to develop this crop both at industrial and agricul­
tural level , in particular so as to help ensure a better equilibrium between agri­
cultural production in the northern and southern parts of the Community .
 ---pagebreak---                                   1 1 ..
    Report from the Commission to the Council on the advisability of promoting castor
    seed production in the Community
 . The castor seed is an arborescent and perennail plant in warm countries but herba­
    ceous and annual in temperate countries . It - requires fertile land and a climate
    and soil which are neither humid ror arid . Although mainly tropical or subtropical
    it is grown also in Europe where it can interrupt the traditional crop rotation
    in agriculture . Castor oil is a raw material which is much sought after by the che­
   mical industry for very \aried and often highly specializad uses . It is u,sed princi­
   pally in the manufacture of plastics , high quality paints , textile fibres and pharma­
    ceutical products .
   Castor cake , though edible , is not used in animal feed because of its disagreeable
   taste and low nutritive value ; although not highly prized as a fertilizer by deve­
    loping countries because of its low nitrogen content , it is valued more by industria­
    lized countries for sophisticated crops such as early vegetables and flowers , and
   also for use in parks and sports grounds .
. In 1976 the world area devoted to cultivating castor beans was about 1.5 million hec­
   tares , representing an output of 800 000 t of seeds ( 515 kg / ha ) and 370 000 t of oil
   ( 46 % ). Production had been on the increase until 1973 but consumption has dropped
   since then as a result of the high price of the oil . Brazil and India account for a
   total of 69 % of world seed production . In Europe , this crop is limited to the USSR ,
   Romania and Yugoslavia , while Italy cultivated it to a small degree at one time .
   Since Brazil , India and the USSR press their seed locally and prefer to export the
   oil , world seed exports amount to only 10 X of world production . Thailand , Ecuador ,
   Paraguay and , from time to time , China are practically the only exporters of castor
   seeds . Brazil and India account for a total of about 90 % of world castor oil
   exports ; they mainly supply Western Europe , the United States and the USSR .
. Since the castor seed is no longer grown in the EEC the Member States rely for their
   castor oil supplies either on imported oil or on oil pressed locally from imported
   seeds . In 1975 the Member States imported 58 600 t of castor seeds . The Federal
   Republic of Germany , Fance , the United Kingdom and Italy , each of which has an oil
   mill , are the importing countries .
   On the basis of a 46 % yield Community castor oil production in 1975 can be estimated
   at 27 000 t , which is higher than in the two precjeding years.
   Community castor oil imports in 1975 amounted to 40 000 t , mainly from Brazil ( 77 X )
   and India ( 21 JO . France and the United Kingdom were the main importing Member States .
 ---pagebreak---                                               - 2
     Exports amounted to 3 300 t .
     Apparent castor oil consumption in the EEC in 1975 can therefore be estimated at
     64 300 t , representing 140 000 t of seeds .
4 . It would be very much in the Community 's interest to produce part of its castor
      seed requirements itself .
      Experiments carried out in the last three years designed to reintroduce the culti­
      vation of the castor seed in Italy indicate that there is a possibility that it can
     be developed in certain less-favoured areas of Italy and in particular in Apulia
      and Sicily . Alfco it is likely that certain areas of southern France / e.g. Languedoc ,
     would be suited to this crop .
      In this way the agricultural potential of the southern part of the Community could
     be better utilized and the north/ south equilibrium improved . The disposal of produc­
     tion is not likely to pose a problem since Community castor oil requirements repre­
     sent   100 000 ha and those of Italy alone 10 000 ha .
     Since the world market in castor seeds is already very small and may shrink still
     further in the years to come , supply to the Community 's oil mills would become more
     stable if at least part of the seeds could be obtained locally .
     This would facilitate the survival of this industry and consequently provide a better
     guarantee of castor oil supplies to European consumers under satisfactory conditions .
5 . It is to be feared , on the basis of experience with other crops , that initially
     there will be considerable risk of insufficient yields , due in particular to
     inadequate knowledge of growing techniques .
     In these circumstances the reintroduction of castor seed cultivation in the Commu­
    nity will be possible only if producers can obtain slightly higher incomes from this
     crop than they would from competing crops , e.g. durum wheat , particularly since the
     work invdved in castor seed growing is relatively long and difficult .
    On the assumption that the profitability threshold of this crop is about 490 u.a. / ha
     and that the yields of 13 to 15 ql obtained during tests are achieved , producers
    should receive a price of about 35 u.a. / 1Q0 kg , which is near the current world
    market price .
    However , since the world price is normally lower , it would not be realistic to use
    the current price as a basis when determining the aid required . Assuming that a
    price of 35 u.a. / 10Q kg should be obtained , the aid required would have been
    7 u.a . in 1976 ( world price = 28 ) and 13 u.a . in 1975 ( world price = 22 ), or an ave­
    rage of 10 u.a. / 100 kg .
    Thus it should be possible to guarantee a fair income to producers by granting almost
    the same amount of aid as that granted to other oil seeds .
 ---pagebreak---                                           - 3 -
6. Since it involves a crop still to be launched the aid system Implemented should ,
    at the outset at least , be very simple so as to be in keeping with the expenditure
    incurred and to prevent any excessive delay in payment of the aid from discouraging
   producers .
   Although a system of fixed amounts meets this criterion , it would not be appropriate
   to adopt this : it cannot be adapted in accordance with price changes and it does
   not take account of actual yields . It is , however , unlikely that agricultural pro­
   ducers will go in for castor seed cultivation unless they are protected against
   the substantial flctuations in world market prices . Furthermore , it is to be feared ,
                      m
   that , due to inexperience , yields will vary considerably from one producer to
   another .
   An aid system whereby the producer receives a viable and stable price through the
   granting of aid for pressed Community seed it this price cannot be obtained on the
   world market appears to be the system best suited for launching castor seed cultivat­
   ion in the Community .
   The Commission will fix the amount of the aid on the basis of the world market
   price for seeds during the marketing period , deriving this price , if necessary ,
   from the prices of oil ; To prevent imported seeds from benefiting from the aid ,
   a check will need to be kept on seed imports into Member States in which castor
   seed is produced . The control of the quantity of Community seeds processed does
   not pose any problems , in particular since there are at present only four oil mills
   to control .
   In providing that the aid is to be granted to the oil mill on condition that the
   latter has concluded contracts with producers at a minimum price close to the
   guide price the aim is to guarantee that the agricultural producer will not have
   any problems in disposing of his product and will benefit from the aid , and to
   provide Community crushers with a certain incentive to buy Community seeds .
 ---pagebreak---                                        A   N    N  E  X
                                          Table 1
                    World production of castor seeds
                    Area under cultivation -         Yield -■ Kg / ha            !  Production - 1       000 t . '
                             1 000 ha                                                                               l
                   1961 / 65  1975       1976 ( 1 ) 1961 / 65 1975    1976 ( 1 )   1961 / 65    1975     1976 ( 1 ) 1
  World             1366     1689         1543        504        491    515          688         830        794
                                                                                 l
I Africa             121       99    I     100        515        560    640           62          55         64
j N-C America         39       17            20       795        414    554   •       31           7         11
  South America i    366      482          307        870        694    918          318         335        281
                                                                                                       i
  of which :                                                                                           i
  Brazi I            323      429          270        828        676    910          268         290        246
I Ecuador             19       40            25      1148        675    720           22          27         18
  Paraguay            11       11            11      1373      1545    1535           15          17         18
  Asia               650      880          880        319        413    418          220       . 363 I      368
I of which :
  China              124      175          175        371        457    429           46          80         75
  India              469      583          580        223        371    388          105     I   216        225
  Thai land           39       30            39      1097      1149    1159           42     !    34         35
                                                                 462    458           20          10          10
  Europe              27       21            21    !  734
  of which :
  Romania             21       21            21       640        440    435            14          9           9
  USSR               123      190          215        299        316    279           37          60         60
  Source    :  EC Commission , 06 for Agriculture on Jrbe basis of FA0 statistics
  < 1 > Estimates
 ---pagebreak---                                 ANNEX
                                  Table 2
                      World trade in castor seeds
                                                                 ( tonnes )
                            1966              1973              1974   (1)
                      A.  IMPORTS
  World                175 917              117 963            123 012
  of which :
  Brazil                                     17 404             25 300
  Japan                  63 030        j     45 916             38 101
  Europe               108 225               49 176             54 119
                      B. EXPORTS
  World                165 075              105 269             95 022
I of which :
  Ecuador                 9 860              27 200             19 223
  Paraguay                8 026               6 458             19 100
  China                  56 303              13 500              4 000
  Thailand               43 859              26 578             27 886
  Source : EC Commission , DG fcr Agriculture on the basis of FAO statistics
  (1)   1974 : estimates
                                         /
 ---pagebreak---                            ANNEX
                                Table 3
                International trade in castor oïl
                                                            ( tonnes )
                                                          i
                                          t
                               1966           1973                 1974   (1)
                                                          [
                        A.   IMPORTS
World                      119 255          174 557              191 000     .
of which :
United States                46 340          46 996                56 567
Japan                             12          5 192                 4 558
Europe                       65 169          99 574               114 910
USSR                                         13 300                12 100
                        B.   EXPORTS
World                      116 202          185 676               202 368
of which :
Brazi I                      95 043     i   132 223               155 793
Indi a                           617         40 267                31 000
Source : EC Commission , DG for Ag-iculture on the basis of FA0 statistics
(1)    1974 : estimates    \
 ---pagebreak---                                A   N  N   E X
                                   Table 4
               Castor oil   -    Trade with non-Member States
                                                                ( 1975   -   tonnes )
                             Seeds                                   Oit
                           lED&QÇy                    lOLQÇlS '                  ÊXûQÇtS
B.R. Deutsfchland         33 934                     3 905                      1 926
France                    10 346                    20 376                        825
Itali a                    6 429                         19                        40
Nederland                                            1 859
BLEU / UEBL                                            343                         42
United Kingdom             7 899                    14 073                        349
Ireland                                                  17
Denmark                                                  17                        12
E.E.C.                    58 608                    40 609                      3 271
of which from :                                 of which from :
Paraguay                  18 679     32 X     Brazil   31 450            Poland        751
Ecuador                   15 021     26 X                 ( 77 X )       Austria       390
Thai land                  3 995      7 X     India      8 432           Spain         357
TBnzania                   3 845                          ( 21 X )       Czechos-      354
  PR China
                                                                           lovakia
                           3 444
Source : EC Commission , DG for Agriculture
                                                        \
 ---pagebreak---                             ANNEX
                               Table 5
              Prices of castor seeds and castor oil
                                        (1)
1 . Prices of castor oil - dollar / t
1971         1972      1973       1974      1975         1976
                                                    CO 8 months )
  339         546     1 117        740       590           651
888888888
Source    :   FA0
( 1 ) Brazilian No 1 , in bulk / immediate delivery ; Cif European ports ;
      from 1974 in tank Rotterdam
2 . Prices of castor seeds and castor oil     - u.a. / t / cif Europe
                                   1975  ■         1976             6
              Seeds                 220             277            249
              Oil                   439             555            497
Source    :   EC Commission , D6 for Agriculture on the basis of data supplied
              by traders
                                                 \
 ---pagebreak---                  FINANCIAL              STATEMENT
                                                                            DATE i  8 June 1977
 1 . BUDCET LINS COHCLTCJED I         Chapter 63 , Article 634
 2. ACTION i      Draft Council Regulation laying down special measures in respect
                  of castor seeds
 3 . LEGAL BASIS I          Article A3 of the Treaty
4. OBJECTIVES i         Development of castor seed production in the E.E.C.
5 . FINANCIAL COHSEQUCNCE                 FOR THE MARKETING YEAH CURRENT FINANCIAL YEAH FOLLOWING FINANCIAL YEAH
                                                                       ( 77 )                    ( 78 )
5.0 EXPENDITURE
      -CHARGED TO THE EC BUDGET
       ( KKWSM«/l?lTERVENTIOHS )            0.2 - 0.5 M ua                                token entry
      -CHARGE» TO NATIONAL ADMINISTR .
      –CHARGED TO OTHER NATIONAL CROUPS
5.1 RECEIPTS
      -OWN RESOUnCiS OP THE EC
       ( LEVIES/CUSTOMS DUTIES )
      -NATIONAL
                                          YEAH .... j.97£ .      year        ..1980..   TEAR . . . .Y9M . .
5.0.1 PLURIANNUAL PATTERN OF EXPENDITURE
                                              0.15 M ua               0.30 M ua            0.45 M ua
5.1.1 PLURI ANNUAL PATTERN OF RECEIPTS
5.2 KETilOD OF CALCULATION
      1978 harvest :             1 000 ha = 1 500 t x 100 u.a. / t              150.000 u.a .
      1979 harvest :             2 000 ha = 3 000 t x 100 u.a. / t          =   300.000 u.a .
      1980 harvest :             3 000 ha = 4 500 t x 100 u.a. / t          =   450.000 u.a .
       The aid will be paid in the year following that of harvest / given the time
        lapse between the submission of the application for aid and payment .
6.3 CRZD1TS TO BE HRITTQf INTO FUTURE BU3X3STS 1
                                                   from the' 1979 budget
C0HXENT3 I