After 3 weeks of delays, on 26 June, EU farm ministers adopted a reform of the Common Agricultural Policy (CAP).
The key elements of the new, reformed CAP in a nutshell:
a single farm payment for EU farmers, independent from production; limited coupled elements may be maintained to avoid abandonment of production,
this payment will be linked to the respect of environmental, food safety, animal and plant health and animal welfare standards, as well as the requirement to keep all farmland in good agricultural and environmental condition ("cross-compliance"),
a strengthened rural development policy with more EU money, new measures to promote the environment, quality and animal welfare and to help farmers to meet EU production standards starting in 2005,
a reduction in direct payments ("modulation") for bigger farms to finance the new rural development policy,
a mechanism for financial discipline to ensure that the farm budget fixed until 2013 is not overshot,
revisions to the market policy of the CAP:
1. asymetric price cuts in the milk sector: The intervention price for butter will be reduced by 25% over four years, which is an additional price cut of 10% compared to Agenda 2000, for skimmed milk powder a 15% reduction over three years, as agreed in Agenda 2000, is retained;
2. reduction of the monthly increments in the cereals sector by half, the current intervention price will be maintained;
3. reforms in the rice, durum wheat, nuts, starch potatoes and dried fodder sectors.
