EU mulls keeping young farmers on land

Farming not profitable enough to attract youth

Consolidation may help but it8217;s not enough

Grants seen of little help

Measures to support young farmers will be part of draft proposals due on Oct. 12 for overhauling the bloc8217;s controversial 55 billion euro 75 billion a year Common Agricultural Policy CAP from 2014.

But with just 6 percent of European farmers under the age of 35,time is running out to prevent many farms from being abandoned,and the incentives may not be enough to lure young Spaniards to cultivate marginally profitable land.

Cesar Trillo,who grows grains,forage,fruit,vegetables and beans in the northern province of Huesca,grew up in a household of six who worked a small holding,but he is now the only farmer left in his family. He advised his two daughters to study engineering rather than take up farming.

That8217;s the way it is. Farming in this country has been unprofitable and God-forsaken for years,said Trillo,who is 64. There won8217;t be a generational handover in my case.

More than 10 percent of all land in Spain is used to grow grain on land where irrigation is not feasible,and it only yields about one third as much as fertile parts of northern Europe and the Black Sea basin.

This makes farm profits marginal,and Spanish farmers depend on EU subsidies for 30-40 percent of their turnover. EU data show that European farmers earn an average of less than 1,000 euros a month,or 34 percent less than urban workers.

The unirrigated acreage planted to cereals in Spain has already dropped by 11.5 percent since 2002 as direct subsidies have been cut in previous CAP reviews. Expected further reductions could put young people off farming altogether.

The CAP is less and less supportive of farm economics,and that will wreck competitiveness,for example,of dry-land farming. Young people leave because they have no hopes,said Luis Lopez-Bellido,professor of agriculture at the University of Cordoba.

CONSOLIDATION

More fertile farmland in some regions may be snapped up by other producers. Demand by farmers is propping up land values in several parts of the world.

The trend of consolidation has always been there. But there8217;s a limit to what consolidation can achieve,and you still need enough well trained people to manage production,said Joris Baecke,president of the European Council of Young Farmers CEJA.

Andres del Campo,president of the 700,000-strong Spanish Federation of Irrigators,Fenacore,noted that farmland is not in demand in Spain8217;s dead property market and needs constant irrigation or tillage to remain productive.

What society in general and politicians must realise is that when farmland is abandoned,especially in the Mediterranean,it does not turn into a forest,say,but rather a desert or dump for the nearest town.

If ageing continues,much of rural Spain could be depopulated in 20 years,while overpopulated cities would increase problems with global warming and waste management.

If small towns are abandoned,then this really is important,because that will mean the surroundings won8217;t be cared for,and it will provoke forest fires,Lopez-Bellido said.

PROPOSED SOLUTIONS

Currently under CAP rural development rules,member states and the EU can jointly finance payments of up to 55,000 euros for qualified farmers under the age of 40 over the first five years after they set up business.

The Commission will propose raising the maximum installation aid payment for young farmers to 70,000 euros as part of its plans to reform the CAP from 2014,according to draft proposals due in October.

Del Campo noted that of 630 million euros already earmarked for installation aid between 2007-2013 in Europe as a whole,only one quarter has been allocated and just 8,000 young people have taken up farming.

Mindful of such criticism,the Commission will also propose a 25 percent increase in direct EU subsidies for young farmers in their first five years 8212; payments that are fully funded from the bloc8217;s budget and therefore universally applied.

Baeker,who is 33 and grows cereals,potatoes,onions,beans and sugar beets in the Netherlands,said new subsidies could be a cost-effective way of reversing the ageing of Europe8217;s farm population.

The real problem for young farmers is being able to start up a business. It keeps even some very motivated people out. We are entrepreneurs in the end. You take on loans to be able to run your business,but interest needs to be paid,he said.

The share of young farmers in the overall farming population is quite small,so if you target support to the first five years after they start up,you can do a lot with a relatively small part of the total budget.

Lopez-Bellido was less optimistic.

CAP installation aid is not going to solve this,because it is a token gesture,he said. If Spanish farmers depend on subsidies for 30-40 percent of their income,then you tell me how they will live without those subsidies.

1 = 0.733 Euros editing by Jane Baird

FACTBOX-Number of young European farmers shrinking

Tracts of countryside in Spain are likely to turn into desert or waste dumps unless the European Union provides enough support to young farmers to stop them from leaving the land for the city.

Measures to support young farmers will be part of draft proposals due on Oct. 12 for overhauling the bloc8217;s controversial 55 billion euro 75 billion a year Common Agricultural Policy from 2014.

Following are key facts about the age of European farmers,how much they earn and what they produce.

AGEING

Six percent of farmers are aged less than 35 in the 27 member countries of the European Union.

Almost half of EU farmers are more than 55,34 percent of them are more than 65. Over-55 farmers outnumber under-35 farmers by nine to one.

Latest available data showed 786,000 Spaniards worked in farming in 2009,down from 979,000 in 2004.

GRANTS

Under current CAP rural development rules,member states and the EU can jointly finance payments of up to 55,000 euros for qualified farmers under the age of 40 over the first five years after they set up business.

The Commission will propose raising the maximum payment for young farmers to 70,000 euros as part of its plans to reform the CAP from 2014,according to draft proposals due on Oct. 12.

Not all young European farmers have access to this installation aid,which is a voluntary measure. Malta,the Netherlands,Slovakia,many German regions and Wales have opted out from the beginning,while Ireland and Latvia have scrapped the measure due to the financial crisis.

INCOME

The average annual income for EU farmers is less than 12,000 euros per year,or 34 percent less than for urban workers.

Total farm income in Spain fell by 6.2 percent between 2004 and 2009,the latest year for which figures are available. It has been declining steadily since 2003.

SPANISH FARMS

A total of 54,012 square kilometres of dry,non-irrigated land were planted to grain in the 2010/11 season. That compares with 61,068 square km in 2001/02.

Spain8217;s total surface area is 504,790 sq. km,making it the second-biggest country in the EU after France.

Spanish farmers can grow about 3 tonnes of grain per hectare of dry land,compared with 8-9 tonnes in more fertile parts of Europe and the Black Sea basin.

Agricultural in general accounts for 2.8 percent of Spain8217;s economy.

Spanish agricultural output accounts for 12.5 percent of that produced in the EU,ranking it third in the bloc after France and Italy.