CAP REFORM IN SPAIN

2014-2020

Paris, 20 Nov. 2014

Jose Luis Iranzo Alquezar

CAP REFORM. SPANISH APPLICATION

INDEX

– Active farmer definition– Regional model for direct payments application– Greening in Spain– Coupled payments for livestock sector. – Second Pilar. Rural Development. – The reform impact in the livestock sector– Conclusions

J.L. Iranzo – COAG

Paris, 20 de noviembre de 2014

ACTIVE FARMER (requirements to get aids)

• Active Farmer: Is the farmer who receives agricultur incomes over the 20% of total PAC Incomes

These rules are not applied to the small producers. • The small farmer is the person who recieves CAP incomes until

1.250 € per year. The small farmer neither must achieve any requirement about cross compliance or about greening.

CAP Incomes: 10.000 €Other Activities incomes: 80.000€Farmer incomes: 2.000 €

Active FARMER

CAP Incomes: 10.000 €Other Activities incomes: 5.000€Farmer incomes: 1.800 €

NO Active FARMER

Agriculture activity definition

For the activation of CAP rights to the first assignment, will be required to be registered in the relevant registers of agricultural and livestock operations.

A livestock farms will be required a dimension of at least 0.2 UGM / ha. species of grass.

They can only activate grazing rights on surfaces exploitation those discharged in registers in 2013.

It will monitor the area of the holding are subject to cultivation or maintenance.

Annual maintenance of the plots with supporting documentation for expenses and payments available to the authorities is required.

TRUE Declaration of logging on each plot or enclosure.

AGRICULTURAL ACTIVITY - Livestock

Requirement to use of each plot, with grazing or mowing clearing.

Declaration REGA code - compatible with livestock species using GRASS. (Therefore, are not included pigs or chickens)

Minimum 0.2 LU / ha of pasture associated. This requirement has not yet been approved by the European Commission.

5.134

8.165

5.535

3.318

0

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

9.000

ES FR AL RU

Mill

ones

de

€

910.000 beneficiarios

390.000 beneficiarios

353.000 beneficiarios

181.000 beneficiarios

5.642 €/benef 20.936 €/benef 15.680 €/benef 18.331 €/benef

Direct payments: Quantity of Beneficiaries in several countries

Actually, farmers which have a real agriculture activity are between 400.000 -450.000. Lees than the middle of the beneficiaries.

Layered system aids in Spain

1. Basic Payment System: New Rights

2. Green component: 30% annual national ceiling

3. Coupled Payments Volunteers: 12%

4. Additional voluntary payment: areas with specific limitations to 5%: in Spain has not been applied.

5. Additional payment: for young: up to 2%

6. Simplified scheme for small farmers: up to 10%

Budgetary limits and distribution of amounts (2015)

Individual applicationApróx. 86%

12%

Régimen agricultores jóvenes    96 M€ Máx. 2%

30%

Aprox. 56%

Pago asociado   726  M€

Pago "verde" o greening   1.452  M€

Pago base (regionalizable)  2.489 M€  +  77 M€  RN

Limite máximo nacional ANEXO II (2015)  4.842 

M€

Coupled payment

Young Farmers

Based Payment

BASIC PAYMENT SYSTEM

1. It is the main layer. It is a NEW system that replaces the current.

2. It is a direct payment decoupled uniform (in the region) based on transferable rights activated on eligible land and subject to conditionality.

3. Regional application. Regionalization model of Basic Payment Scheme (RPB) based on the amounts of aid received in each agricultural region (316 in Spain) and, within each region, in each type of surface: dry crops, irrigated crops, crops permanent and pastures.

4. The amounts are distributed among the agricultural regions in proportion to the direct payments received by them in 2013.

5. From here, 24 regions aid intensity will conform. The system is based on the principle aid intensity in each region generated by surface type.

APPLICATION STATUS QUO

1. With this approach, the amounts of the regime of basic payment (RPB) are distributed among the agricultural regions in proportion to the amounts of aids received in 2013. Its ensures that each region retains for calculating the RPB part proportion of direct payments that has been receiving.

2. Besides, as the green payment or "greening" is calculated as a percentage of RPB. Each agricultural region will receive a sum of RPB + green payment proportional to the payments been receiving.

3. The objective of the Spanish administration in the definition of regions has been to minimize the transfer of amounts or internal convergence.

4. To avoid massive influx of land and the dilution effect of aid, reference area is the requested in 2013.

In conclusion, the aim has been to get all those receiving aid generated before the previous reform, keep the amount of aid for as long as possible. To do this, the administration has maintained the highest level of support in the most productive areas in decline in disadvantaged areas and mountain areas.

REGIONALIZATION

For each region will be calculated until four different average amounts

REGIONALIZATION

Dryland cereal region

Pasture region

Convergence 2015 →→→ 2019

Nobody lost more than 30% of what they will charge 2015

No charge less than 60% of the average support per hectare in the

region in 2019

Those who earn less than 90% of the average support per hectare in the

region will increase at least 1/3 of the difference between payments in 2015

and that 90%

First assignment of rights to direct payment in 2015. Each recipient:

1. Number of CAP rights: will equal the number of eligible hectares declared with the boundary of the area declared in 2013.

2. Duty rates. Would have up to 4 types of rights by agrarian region with different amounts per unit hectare.

3. Unit amount. The first year, the initial unit value by surface type according to the model raised would be calculated taking into account the amounts collected in the 2014 and the area declared in 2015.

4. Wines and fruits and vegetables areas are not incorporated.

Basic Payments

GREENING

30% nacional ceiling (1.453 M€ en 2015).

Aprox. 50% direct payments

Compulsory three rules:

Crops rotation

Manteniance of pasture

Special Interest focus areas

Ecological agriculture, small farmers, and permanent crops, are included directly.

Coupled payments Payments linked to production (per ton or animal).

Spain can use up to 13% of the national ceiling.

This limit can be increased by 2% on the condition on giving support to the production of protein crops.

The coupled payment should be used with sectors with difficulties and economic, social and/or environmental implications.

COUPLED SECTORS

Fuente: MAGRAMA (Elaboración propia)

SECTOR IMPORTES PAGOS ACLOPADOS

CALVES 40.127.000,00 €

BOVINE 187.745.000,00 €

SHEEP 154.892.000,00 €

GOAT 13.645.000,00 €

DAIRY CATTLE 93.579.000,00 €

SUGAR BEET 16.836.000,00 €

RICE 12.206.000,00 €

TOMATO FOR INDUSTRY 6.352.000,00 €

ALMONDS 14.000.000,00 €

PROTEIN CROPS 44.537.000,00 €

QUALITY PULSES 1.000.000,00 €

584.919.000,00 €

% COUPLED 12,08%

Coupled Bovine

• € 188 million.

• The eligible cow must have had at least a calving 18 months before thefinal date of annual application (approx. 0.6 CALVES / COW / YEAR)

• This aid is only for meat breed

• ESTIMATED PREMIUM = 90 € / animal.

Calves

• 40 million €

• Cattle between 6 to 24 months destined for slaughter or export.

•Minimum stay of 3 months in the farm.

•Minimum 3 eligible animals

•Support estimate: € 12 per calf, and 3 € if the calf is born on the farm.

Dairy Cattle

• Mountain Areas and Balearic Islands → 33.5% (31 M €)Rest Areas → 66.5% (62 M €)

• AMOUNT OF AID:First 75 cows → 100% HELPFrom Cow 76 → 50% HELP

• Estimate:€ 114 / animal ZZ. Mountain + Baleares€ 100 / animal Rest Naciona territory

Sheeps and Goats

• Sheep: 155 millones €.• Goat: 13,6 millones €.• Nowadays, there are 16,8 millones of sheeps in Spain and

2 millones of goats.• Estimation:

• 9 €/per sheep or goat

SECOND PILARRURAL DEVELOPMENT

A country and 17 different regional rural development programs.

•A national program to promote the cooperative concentration, maintenance of forests and to promote the fight against climate change.

•17 different regional programs in which each region chooses to support most representative sectors in their territory.

•Almost all regions have pursued a philosophy of continuity supporting the same programs as the previous reform.

•Spain has for this issue around € 1,900 million from the EU. Co-funding is different in each Autonomous Community.

•Almost all Autonomous Communities have aid to promote the autochthonous livestock breeds.

CONCLUSIONESImpact of the Reform in the Spanish livestock sector.

1. Abandonment of farming in less favored areas.

2. Increase of the most intensive farms in lowland areas.

3. Abandonment of mountain pastures

4. Reduction of extensive livestock (sheep, goats, cows, etc.)

5. Dairy cattle production is moving from traditional producing areas (eg the north of Spain), to areas close to the dairy industry.

CONCLUSIONESImpact of the Reform in the Spanish livestock sector.

In summary, this PAC is marked by Satus Quo, immobilism, and clearly will hurt disadvantaged mountain areas and will benefit traditionally richest and most productive areas.

Coupled payments are not attractive enough for people to continue with the activity in the most traditional farms in less favored areas and mountain. Areas that have not had any special treatment in this reform, although the Commission Europe

In principle, one can expect that the Spanish production does not drop, but if it will move and concentrate in certain zones, as has happened already in the pig sector.

Sectors such as sheep will suffer a reduction in the number of dedicated animal meat, which could be estimated at around one million annual reduction (In 2000, Spain had 22 million sheep and 11 million last census are ).

I'm afraid not ...

Are you sure to have any chance in this land?

Thank you

J. L. Iranzo – Comisión Ejecutiva COAGwww.coag.org