Cursul 12

"Common measures of market regulation

Market measures aim to stabilise agricultural markets and prevent market crises from escalating (market
intervention measures), boost demand and help EU agricultural sectors to better adapt to market changes.
They are part of the common market organisation regulation, which lays out the framework under which EU
agriculture works within the single market. Market intervention measures are funded through the European
agricultural guarantee fund.

Public intervention

Public intervention is where products are purchased and stored by EU countries governments or their
agencies until being sold back onto the market at a later date. It aims to prevent prices from dropping to
unsustainably low levels.

Public intervention is currently available in a number of sectors that are prone to fluctuations in price. To
combat this instability, the EU has adopted a mechanism to mitigate the impact on farmers of years with
particularly low price levels. The sectors, which can benefit from public intervention are:

 wheat, durum wheat, barley and maize

 rice
 beef and veal
 butter
 skimmed milk powder.

The common organisation of agricultural markets in the EU

 WHAT IS THE AIM OF THE REGULATION?

 It aims to provide a safety net to agricultural markets through the use of market support tools
(for example public intervention and private storage), exceptional measures and aid to specific
sectors (particularly fruit and vegetables, and wine).
 It seeks to encourage cooperation through producer organisations and inter-branch
organisations (organisations that represent activities involving the production of, trade in
and/or processing of products in a number of sectors).
 It also lays down minimum quality requirements (marketing standards) for a number of
products, as well as rules on trade in agricultural products and specific rules
on competition.

KEY POINTS

The main features of the common organisation of the markets (CMO) are:
Market intervention
The regulation lays down rules regarding:

 public intervention, where products are purchased and stored by EU governments or their
agencies until their disposal; and
 aid granted for the storage of products by private-sector organisations.

It revises the existing systems of public intervention and aid for private storage making them more
responsive and efficient. This is, for example, by means of technical adjustments for beef and dairy
products, and certain cheeses with a protected designation of origin or a protected geographical
indication.
Exceptional measures

 The European Commission can take emergency measures against market disturbance caused

by significant price fluctuations or when there are threats of significant price fluctuations. It
may also take action to deal with the market impact of measures taken to combat the spread of
animal diseases or serious market disturbances caused by a loss of consumer confidence as a
result of public, animal or plant health and disease risks.
 In the case of major market disruptions, the reserve for crises provides additional support to
finance these measures.

Supply control measures

 Milk and sugar quotas: the regulation brings these to an end in 2015 and in 2017
respectively, allowing EU producers to be more competitive both domestically and globally.
 Regulation in the wine sector: in 2016, the regulation introduced a new system for
authorising new vine planting rights to apply until 2030. This provides for an increase in the
planted area of up to 1% per year.

Other measures
The annual budget for schemes promoting fruit and milk consumption in schools has increased (from
€90 to €150 million).
Producer and inter-branch organisations
The regulation promotes the creation of producer organisations to strengthen their power in the food
chain. It has been amended and supplemented by:

 Regulation (EU) 2017/2393 which allows recognised producer organisations in all

sectors in which a CMO has been introduced to carry out activities such as production
planning, optimising production costs, marketing members’ products and contract negotiation.
It also extends the aims of inter-branch organisations to preventing and managing risks
relating to animal health, plant protection and the environment.
 Regulations (EU) 2017/891 and (EU) 2017/892 which simplify and clarify the rules with
regard to producer organisations in the fruit and vegetable sector.

Trade with non-EU countries

The import and export of certain products may require a licence.
Import duties in the Common Customs Tariff apply to agricultural products, although specific rules
are laid down for certain products (e.g. hemp, hops, wine and sugar for refining). Moreover, the
Commission may fix import tariff quotas, i.e. specific limits on the volume of goods which may be
imported with a reduced customs duty.

FROM WHEN DOES THE REGULATION APPLY?

It has applied since 1 January 2014.

BACKGROUND

The regulation on the common organisation of markets in agricultural products is one of a package of
CAP reform measures. The package also includes regulations on:

 the financing, management and monitoring of the CAP;

 direct payments to farmers;
 supporting rural development; and
 determining measures on fixing certain aids and refunds related to common organisation of
the markets in agricultural products.
For more information, see:

 Overview of CAP reform 2014–2020 (European Commission).

MAIN DOCUMENT

Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013
establishing a common organisation of the markets in agricultural products and repealing Council
Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (OJ L
347, 20.12.2013, pp. 671-854)
Successive amendments to Regulation (EU) No 1308/2013 have been incorporated into the original
text. This consolidated version is of documentary value only.

RELATED DOCUMENTS

Regulation (EU) 2017/2393 of the European Parliament and of the Council of 13 December 2017
amending Regulations (EU) No 1305/2013 on support for rural development by the European
Agricultural Fund for Rural Development (EAFRD), (EU) No 1306/2013 on the financing,
management and monitoring of the common agricultural policy, (EU) No 1307/2013 establishing rules
for direct payments to farmers under support schemes within the framework of the common
agricultural policy, (EU) No 1308/2013 establishing a common organisation of the markets in
agricultural products and (EU) No 652/2014 laying down provisions for the management of
expenditure relating to the food chain, animal health and animal welfare, and relating to plant health
and plant reproductive material (OJ L 350, 29.12.2017, pp. 15-49)
Judgment of the Court (Seventh Chamber) of 14 June 2017. Verband Sozialer Wettbewerb eV v
TofuTown.com GmbH. Request for a preliminary ruling from the Landgericht Trier. Reference for a
preliminary ruling — Common organisation of the markets in agricultural products — Regulation (EU)
No 1308/2013 — Article 78 and Annex VII, Part III — Decision 2010/791/EU — Definitions,
designations and sales descriptions — ‘Milk’ and ‘milk products’ — Designations used for the
promotion and marketing of purely plant-based products. Case C-422/16
Commission Delegated Regulation (EU) 2017/891 of 13 March 2017 supplementing Regulation (EU)
No 1308/2013 of the European Parliament and of the Council with regard to the fruit and vegetables
and processed fruit and vegetables sectors and supplementing Regulation (EU) No 1306/2013 of the
European Parliament and of the Council with regard to penalties to be applied in those sectors and
amending Commission Implementing Regulation (EU) No 543/2011 (OJ L 138, 25.5.2017, pp. 4-56)
See consolidated version.
Commission Implementing Regulation (EU) 2017/892 of 13 March 2017 laying down rules for the
application of Regulation (EU) No 1308/2013 of the European Parliament and of the Council with
regard to the fruit and vegetables and processed fruit and vegetables sectors (OJ L 138, 25.5.2017, pp.
57-91)
See consolidated version.
Council Regulation (EU) No 1370/2013 of 16 December 2013 determining measures on fixing certain
aids and refunds related to the common organisation of the markets in agricultural products (OJ L 346,
20.12.2013, pp. 12-19)
See consolidated version.
Regulation (EU) No 1306/2013 of the European Parliament and of the Council of 17 December 2013
on the financing, management and monitoring of the common agricultural policy and repealing Council
Regulations (EEC) No 352/78, (EC) No 165/94, (EC) No 2799/98, (EC) No 814/2000, (EC) No
1290/2005 and (EC) No 485/2008 (OJ L 347, 20.12.2013, pp. 549-607)
last update 18.09.2018
The EU is a major producer of beef and veal with a total herd of around 78 million cattle. The EU supports
its farmers through income support payments. Additionally, the EU uses a number of market measures to
stabilise beef and veal markets when necessary.

Market measures in the beef sector

The European Commission may use public intervention to support beef prices if, over a representative
period, the average market price in an EU country or in a region of an EU country drops below €2,224 per
tonne. Additionally, the Commission may decide to grant private storage aid, if there is a drop in average
prices, a substantial change in production costs or another factor causing significant changes in margins that
is damaging to the sector.

The EU also has the power to use exceptional market support measures when specific circumstances mean
that public support is required, for example, in cases of animal diseases or a loss of consumer confidence.

The EU also supports beef farmers through specific exemptions for producer organisations in the beef sector.
Under certain conditions, producer organisations in the beef and veal sector may negotiate the extent of
supply.

The EU monitors the beef and veal market in order to identify market instability, provide accurate
information to farmers and processors on the market situation and to help public policy decision making.

There is an EU wide system of carcass classification, which alongside price reporting and other statistical
information is the basis of the EU's price monitoring system. This is also used as a basis for the grading of
carcasses in slaughterhouses and fair payment to farmers.

Various committees, composed of government representatives and chaired by a European Commission

representative, meet regularly to ensure that the Commission's responsibility for adopting implementing acts
is exercised under the control of EU countries.

The committee for common organisation of agricultural markets meets regularly to discuss areas such as the
evolution of market prices, production and trade in the EU and non-EU countries.

The civil dialogue group and working group on animal products maintains the role of assisting the
Commission in maintaining a regular dialogue on all matters related to beef and veal.

MILK AND DAIRY PRODUCTS

The European Union is a substantial producer of milk and milk products and they are integrated in
the common market organisation (CMO).

Milk production takes place in all EU countries and represents a significant proportion of the value of EU
agricultural output. Total EU milk production is estimated at around 155 million tonnes per year. The main
producers are Germany, France, Poland, the Netherlands, Italy and Spain. Together they account for almost
70% of the EU production.

The EU dairy herd has been decreasing in recent years as the milk yield per cow has improved. In 2018 there
were around 21 million cows in the EU, averaging 7000 kg of milk produced per cow.

Farm and dairy herd sizes vary enormously, as do yields. However, as the dairy sector develops throughout
the EU, variations in yield and other technical factors have been reduced – less developed dairy producers
are rapidly catching up with those who had restructured and modernised first.”

https://ec.europa.eu/info/food-farming-fisheries/key-policies/common-agricultural-policy/market-
measures/market-measures-explained_en