Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
From France to Germany, to Italy, to Greece: the juggernaut of EU farmers’ protests rolls on. Agricultural protests are as old as the EU itself — and farmers, who can bring along tractors and piles of manure to make their point, are a powerful lobby; annual farm subsidies of about €60bn make up roughly a third of the EU budget. Yet rarely have demonstrations been seen across so many countries at once. Policymakers face a tricky balance: between caving in too far to the industry over, say, vital climate measures — or allowing hard-right parties to capitalise on farmers’ grievances in EU elections.
Some other sectors suggest farmers have always been coddled by the EU. Yet in all but the largest enterprises, farming at the best of times involves big risks and meagre rewards. Farmers say that in recent years input and borrowing costs have soared thanks to inflation and the war in Ukraine. Margins have been squeezed by retailers trying to hold down prices in the cost of living crisis. And they complain of being undercut by imports, including Ukrainian products as the EU has — rightly — thrown open its doors to support Kyiv’s economy.
Since agriculture accounts for about 10 per cent of EU greenhouse gas emissions, farmers are being hit, too, by climate policies and the “Green Deal” that is supposed to make the EU economy climate neutral by 2050. An associated “Farm to Fork” strategy aims to reduce pesticides and fertilisers and reshape agricultural practices. Farmers claim these policies take little account of farming realities; the extra money the EU is providing for “eco-schemes” does not cover their costs, and the bureaucracy required to get hold of it is so onerous that it’s barely worth the effort.
The farming lobby has spotted a moment of maximum influence — with European parliament elections looming in June in which anti-establishment parties, especially of the far right, are already expected make big gains. Hard-right politicians have become adept at exploiting the backlash against the costs of the green transition, especially among rural populations. Centre-right parties are wary of being outflanked — and have cottoned on to the votes to be had from pledging a “pragmatic” approach (which usually means diluting targets).
The EU has already had to water down or drop some flagship initiatives, including a nature restoration law aiming to reverse the loss of biodiversity. A long-vaunted trade pact with Mercosur countries is in the deep freeze. Brussels has said it will try to address pressing issues for farmers including price swings and bureaucratic burdens at an agriculture ministers’ meeting on February 26. European Commission president Ursula von der Leyen is hosting “strategic dialogues” with the industry.
As with other parts of the green transition, Brussels and EU states need to find ways to hold firm to the overall goals while offsetting the impact on the most vulnerable groups — by phasing in measures over time, exempting smaller farms, or offering targeted support.
Given the importance of food security, moreover, a broader debate is needed on where in the supply chain the costs of going green should fall: on farmers, on taxpayers through even higher subsidies, or on consumers and the food and retail industry. With the number of EU farms falling due to consolidation as younger generations sell up, more private capital probably needs to be attracted into farming — as is happening, for example, in the US — which can invest in technology and reap economies of scale.
Some governments will fret about rural areas emptying out, increasing the burden on housing and services in cities. Yet, given the difficulty of making a living from farming today, turning farms into more stable businesses owned by companies that can afford to invest might just help to keep more people on the land.