January 31, 2011

EU livestock farming crisis may affect self-sufficiency in food production 

Europe's livestock farming crisis is an alert that the region could become dependent on ever increasing food imports.

Farmers across the 27-country EU bloc say many are deeply in the red after a surge in feed costs, largely driven by bad weather and worries of food inflation, and fear herds will shrink and many farms fall into disuse in the coming months.

In Spain, the COAG farmers' union estimates half the country's 700,000 livestock farmers could be out of work by the end of 2011, adding to what is already the EU's highest jobless rate.

French President Nicolas Sarkozy highlighted food security during a chaotic week for north Africa, which has seen unprecedented anti-government protests in Egypt and continuing unrest in Tunisia, partly fuelled by higher food prices.

Algeria, which has seen its own unrest linked to food prices, stepped up grains purchases buying almost a tonne of wheat to secure adequate stocks, prompting another leg up in already tight wheat prices.

COAG says that the crisis over feed costs, swept higher as wheat prices surge to 29-month highs, shows that reform to the EU's common agricultural policy due from 2014 is more important than ever to guarantee food supplies to 500 million consumers.

Many farmers fear the EU may introduce deep cuts to the much-criticised EUR55 billion (US$75 billion) CAP and abolish tools for intervention in agricultural markets.

"It is so important that the next CAP reform reinforces existing EU market management mechanisms and make more funds available to address new needs and risks facing European farmers, particularly in the livestock sector," a COAG report on the impact of feed costs said.

"Dismantling our productive system in Europe and Spain makes us dangerously dependent on imports," said Miguel Blanco, head of organisation at COAG. "Dependency on strategic sectors such as energy, and above all food, is simply suicidal in the medium and long term."