3rd Cattle Network 3rd Cattle Network –– EAAP WorkshopEAAP Workshop

““Profitability and sustainability of beef farming:Profitability and sustainability of beef farming:Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systems

to CAP regulationsto CAP regulations””

Friday 24 AUGUST 2007 – DUBLIN, Ireland

Organized by the EAAP Cattle Network Working GroupChairman: Jean-Noël Bonnet, France

With the support of :EAAP Cattle Commission

EAAP Livestock Farming Systems CommissionEAAP CEEC Contact Working Group

Sponsored by

3rd Cattle Network 3rd Cattle Network –– EAAP WorkshopEAAP Workshop

Friday 24 AUGUST 2007 – DUBLIN, Ireland

Adaptation and conformation of EU beef systemsto CAP regulations

Synthesis of the Beef Task Force collaboration

F. Becherel (1), P. Sarzeaud (2), C. Perrot (3)

Livestock Institute - France

For the EAAP Beef Task Force

Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systemsto CAP regulationsto CAP regulations Synthesis of the Beef Task Force collaboration Synthesis of the Beef Task Force collaboration

The EAAP Beef Task Force was created with the aim of developing tools and methods for

policy impact analysis and for monitoring and analysis of farm strategies.

The BTF has agreed on the methods of defining standard procedures for monitoring and

analyzing economic efficiency of beef farm operations.

The BTF worked on the analysis of the evolution of the European beef production and beef

farming systems through the last CAP reform.

0

2

4

6

8

10

12

14

16

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Millions of TEC

North America

Oceania

EU- 15 and EU - 25

South America

Changes in the world beef production during the last 10 years

A challenge for the future

?

Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systemsto CAP regulationsto CAP regulations Synthesis of the Beef Task Force collaboration Synthesis of the Beef Task Force collaboration

6,506,757,007,257,507,758,008,258,508,759,009,259,50

89 91 93 95 97 99 2001 2003 2005 2007 2009 2011

Millions TEC

<- EU-15 -> <- EU-25 ->

Forecast

ProductionConsumption

CAP 92-2000Premiums

against prices

CAP 2000-2006Production regulation

CAP 2005-?Premiums decoupling

and subsidiarity

?

?Nati

onali

satio

n

Nat

iona

lisat

ion

ESB

Crisis

ESB

Crisis

Graph from GEB- French Livestock Institute

Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systemsto CAP regulationsto CAP regulations Synthesis of the Beef Task Force collaboration Synthesis of the Beef Task Force collaboration

Beef production affected by political choice. What’s next ?

1-The place of beef production throughout the EU countries

0%

20%

40%

60%

80%

100%

Spain France Ireland Sweden Italy Germany EU 15 2004New

Members

EU 25

Dairy cows Suckler cows

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

Focus on calving, finishingBeef as a complementary production

Source: Eurostat

Dairy and suckler cows share per countries in 2006

Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systemsto CAP regulationsto CAP regulations Synthesis of the Beef Task Force collaboration Synthesis of the Beef Task Force collaboration

5

6

7

8

9

10

11

12

13

14

15

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 20060

5000

10000

15000

20000

25000

EU-15 EU-25

'000 heads

Dairy cows

Suckler cows

Millions TEC

EU Beef production

Dairy production: not the same dynamics as suckler cow production

Decrease of the EU beef production in spite of the stability of suckler cow herd

Source: Eurostat

Dairy and suckler cow herds and EU beef production – evolution 1995-2006

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Spain France Ireland Sweden Italy Germany EU-25

Dairy farms Dairy and beef farms CC farms Fatteners

In Europe: Half of farms are dairy farmsCow-calf farms present in Spain, Ireland & France

15% of beef producers are dairy+beef : France & Germany

41%

15%

35%

10%

Intermediateresults on 2004

FADN DG Agri fromFrench Livestock

Institute

BFS share between countries: important diversity in Europe

2- structural phenomena of increasing size and specialization

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

Small farms are always numerous (Ireland but also South and East of EU)Beef farmers often aged

Prospects: Strong reduction of cattle ownersContinuous increase of farm size

Consequences: Specialization in order to improve efficiency of labour power and to be more engaged in the market (Italy)

3- the 2003 CAP to help farm changes

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

Beyond the “patchwork” of the CAP implementation main orientations such as decoupling and cross

complianceImplementation:

More than half of beef production totally decoupled but two thirds of suckler cows linked to premium

One case of regional premium : GermanyConsequences:

Decoupling = simplificationFarmers don’t integrate new deals completely Effects masked by the market evolution

4- consequences for production (1/2)

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

The case of beef production from dairy calves

Implementation: The lack of calves appears to be the main issue for the future and can be reinforced by the conversion of dairy

farmers to beef farmers especially in mountainous areasConsequences of CAP:

Decoupling of premium makes it easier to stop bull production in dairy+beef farms

Steers on grasslands : a new interest to explore

4- consequences for production (2/2)

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

The case of beef production from weaners

Implementation: Calving activity sensitive to the decoupling of the suckler cow premiumFattening activity competitiveness sensitive to other cereal production (feeding or energy…)

Consequences of CAP: Specialisation of calving and finishing activitiesBull fattening to be more integratedSteers on grasslands : a new interest to explore

5- consequences for land use (1/2)

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

Beef production particularly linked to the land useAdapted to utilize both high potential areas and

grasslands not available for crops.

Consequences for grasslands and mountain uses

Suckler cow premium coupling = support of livestock activity maintenance in the poorest areasSuckler cow decoupling in Ireland = till now no effect on cow-calf herd because of part time activity importance

5- consequences for the land use (2/2)

Adaptation and conformation of EU beef systems to CAP regulationAdaptation and conformation of EU beef systems to CAP regulationssMain statements Main statements

Beef production particularly linked to the land useAdapted to utilize both high potential areas and

grasslands not available for cropping.

Consequences for crops and intensive forage areas

Decoupling : conversion to crop for energy ?Cross compliance (Nitrate Directive, …): the limit of intensive management (fattening in Spain, France or Italy)

Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systemsto CAP regulationsto CAP regulations Synthesis of the Beef Task Force collaboration Synthesis of the Beef Task Force collaboration

5- conclusion-future issues (1/2)

Premium decoupling gives more importance to market regulation

What will be the sensitivity of beef production to the economic cycle ?

The Mid Term Review : a step to a new CAPWhat’s next ? And what will be the next impact?

New competitiveness issues for EU beef production:Compete with crops in EuropeCompete with overseas meat (especially from South America)

Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systemsto CAP regulationsto CAP regulations Synthesis of the Beef Task Force collaboration Synthesis of the Beef Task Force collaboration

5- conclusion-future issues (2/2)

The challenge of cost of production:Question of management : breeding, feeding…Question of equipment : size, labour efficiency…

To be more efficient in the analysis (BTF)More precision of Beef Farming Systems Common estimation of the impacts and management changes: survey, simulation

Adaptation and conformation of EU beef systemsAdaptation and conformation of EU beef systemsto CAP regulationsto CAP regulations Synthesis of the Beef Task Force collaboration Synthesis of the Beef Task Force collaboration

Special thanks to the BTF members

Thank you for your attention