Danes putting regionalisation back on agenda
The latest talk from Brussels regarding CAP reform is that the Danes are having a serious look at the possibility of pushing regionalisation as a means of offsetting losses to their commercial farmers.
With the Danes holding the presidency at EU level at the moment, it appears that their focus has been on weeding out what they believe are red herrings in the reform package to produce an edited version of the proposals. This could then form the basis for discussions between member states after the summer break.
However, one of the ideas they're having a serious look at is the regionalisation of payments. This idea has been gaining momentum since Agriculture Commissioner Dacian Ciolos indicated during his visit to Ireland in November that any regions within member states need not be traditional geographic entities.
Commentators in Europe say that Denmark sees this proposal as a way to protect the single farm payments (SFP) of its farmers.
The level of debt on Danish dairy farms is among the highest in Europe, and the SFP is factored into their repayment capacity. Therefore, any CAP reform agreement which would significantly undermine SFP payments could do real damage at farm level.
The average SFP payment in Denmark, which at the moment is €363/ha -- compared to the EU average of €266/ha -- will drop to €343/ha after the reforms.
Denmark currently has a hybrid system for direct support at present, with an historical element and an area-based element, but there is a gradual shift every year away from the historical payment.