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Food & Ag Briefing: European farmers protest, US biofuels action, delay for von der Leyen

Farmers took to Europe’s streets last week to protest plans for higher environmental and animal welfare standards, whilst ethanol fuelled heated debate in the US.

The changes required to update the food system continue to infuriate the people who are tasked with implementing them, as protests in Germany and France showed this week.

Farmers brought protests to Strasbourg and the rest of France as well to the German city of Bonn, home of the German Agriculture Ministry, to voice their frustrations with plans to change agricultural practices.

The German farmers’ anger was mainly directed at a new package introduced by Agriculture Minister Julia Klöckner and Environment Minister Svenja Schulze at the beginning of September, which sets out legislation for more environmental and animal protection in agriculture.

Among other things, it stipulates that the use of the controversial weedkiller substance glyphosate will be banned in the country by the end of 2023, after a phasing-out period.

The government also seeks to reduce the nitrate content in groundwater by cutting the use of certain fertilisers and liquid manure. The country has come under pressure by the European Commission for exceeding the allowed nitrate levels laid out in the EU’s Nitrates Directive (91/676/EEC).

Meanwhile, Germany’s neighbour, Austria, has been recognised as the only EU country which has a region with more than half of its agricultural land dedicated to organic production.

The region of Salzburg, in Austria, had by far the highest share of organic farmland in 2016, with 52% of total utilised agricultural area (UAA) under organic production, according to new Eurostat figures.

This share was also at least a quarter in seven other regions: Severozápad in Czechia (30%), Norra Mellansverige in Sweden (29%), Calabria in Italy (29%), Mellersta Norrland in Sweden (28%), Burgenland in Austria (27%), Sicilia in Italy (26%) and Moravskoslezsko in Czechia (25%).

Despite these developments, a think tank believes that EU Agriculture Ministers are trying to weaken environmental conditions for direct payments under CAP as proposed by the European Commission.

The Institute for European Environmental Policy (IEEP) has criticised Agriculture Ministers in the Council for trying to water down the greening provisions while at the same time proclaiming the importance of having stronger environmental and climate ambitions.

US biofuels debate

In the US last week, a lawsuit challenging the Environmental Protection Agency’s (EPA) rationale for granting small refinery exemptions (SREs) for the 2018 compliance year under the Renewable Fuel Standard (RFS) was launched by a coalition of biofuel proponents.

Separately, a US Senator said the EPA’s Administrator, Andrew Wheeler, should resign if the organisation did not follow through on the Trump Administration’s plan to boost demand for ethanol.

Whether the 15-billion-gallon conventional biofuel volume mandate is met is key, Republican Senator Joni Ernst said. “If we don’t see that result, that 15 billion gallons, then I’m ready to call for the resignation of Andrew Wheeler. Let’s make sure that this gets done,” she remarked.

Ernst said she would raise the issue with President Donald Trump should Wheeler fail to follow through. If Wheeler does not, “we’re going back to the president and saying, ‘Andrew Wheeler is the one that is not following through with your commitment to America’s farmers. You need to get rid of him,” she said.

Also last week, US groups criticised new seasonal restrictions put in place by the Brazilian government on its tariff-free quota for US ethanol imports.

On August 31, Brazil raised the tariff-rate quota (TRQ) for duty free imports of US ethanol to almost 750 million liters (19.8 million gallons) per year – up from the previous 600 million liters per year. Imports above the quota face a 20% tariff.

Now, Brazil has introduced a seasonality clause for the imports, saying that from August 31, 2019 through February 29, 2020, 200 million liters could be imported without the 20 percent tariff, with 275 million liters able to be imported each quarter without the tariff from March 1, to August 31, 2020.

The Renewable Fuels Association (RFA), US Grains Council (USGC) and Growth Energy said the decision the decision to now impose seasonal restrictions on the TRQ was disappointing and represented “additional roadblocks to free trade, hurting consumers and our respective ethanol industries”.

Delay for von der Leyen

Also disappointed last week would have been Ursula von der Leyen, who was due to take over as new European Commission president on November 1st.

Von der Leyen is now set to take office only on December 1, a month after the scheduled start date, as France, Hungary and Romania are forced to find replacements for their three rejected nominees for commissioners.

Following an initial round of hearings, the European Parliament rejected Hungary’s László Trócsányi, Romania’s Rovana Plumb and France’s Sylvie Goulard, meaning that von der Leyen had to ask the three member states to put forward new nominees.

The current European Commission, under Jean Claude Juncker, agreed to set up a new task force last week to deal with the current and future negotiations with the UK as it prepares to the leave the bloc.

The new body, called the “Task Force for Relations with the United Kingdom” (UKTF), was announced on October 22 and Michel Barnier has been appointed as its’ head.

At the European Parliament last week, MEPs approved a proposal that would see UK farmers and other sectors receiving EU funds through 2020.

MEPs say the aim is to minimise any negative impact that the UK's withdrawal may have on beneficiaries of EU funding and on the European Union budget in the case of a no-deal scenario. The measure includes programmes such as Horizon 2020, Erasmus and agriculture and regional policies.


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Week Ahead and Updates

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