The challenges facing European agriculture: Crisis or opportunity for transformation?

Agriculture

Hervé Pillaud

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18 February 2025
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Pillaud Hervé

Hervé Pillaud

Consultant

The challenges facing European agriculture: Crisis or opportunity for transforma...

PDF | 167 koIn English

2024 will be remembered as a pivotal year for European agriculture as it faced major climatic, economic and geopolitical crises. It was also the year in which the Parliament and the Commission were renewed. While the representation of farmers in the European Parliament remains relatively stable compared to the previous term, it will be some time before their real influence can be judged. The new European Commission is keen, it seems, to pursue ambitious transformations striking a fine line between competitiveness (the new Brussels mantra) and sustainability, voluntarism and budgetary realism. Will it be possible to meet the challenge when instability, particularly in France and Germany, is compounded by the rise of populism in a good number of Member States, encouraging them to look inward, sometimes seeing Europe as nothing more than a necessary evil?

European agriculture in 2024: contrasting conditions, against a backdrop of crises

In 2024, while some countries recorded spectacular increases in their agricultural production, others, like France, suffered the combined effects of climatic, economic, political and social disruption. According to Eurostat’s estimates, based on the economic accounts for agriculture, agricultural productivity in the European Union rose by 1.6% in 2024 overall, a figure that masks major disparities however. Latvia (+46.9%), Luxembourg (+27.1%) and Sweden (+22.5%) stand out with impressive increases, driven by strategic investments and rapid adaptation to new climatic requirements. On the other hand, fourteen Member States recorded significant decreases in output among the biggest producers, notably Romania (-16.8%), Hungary (-15.5%) and Poland (-12.5%). This is cause for concern. In these Eastern European countries, economic gloom is easily combined with criticism of the European Union and a growing mistrust of the increasing norms imposed by a supranational body. For some, this is a reminder of a painful past. The question of the European Union's agricultural cohesion and the need to ensure that certain parts of the Union remain in line with its development was already cause for concern expressed by Janusz Wojciechowski, European Commissioner responsible for agriculture during the previous term (2019-2024). 

2024 started badly for European agriculture with multiple problems. In Italy farmers drove their tractors en masse to Rome. In Spain, they blocked motorways, likewise in Portugal and the Netherlands. The day of action in Poland will be remembered as they blocked the border with Ukraine. In France, the outlook for 2024 was not good, with the prospect of a continued downward trend as in 2023. Across Europe, the situation was worrying, with the outlook for a decline in gross added value per farm asset. This downturn has been attributed to a marked drop in production volumes, particularly in cereals, oilseeds, protein crops and winegrowing, due to particularly unfavourable weather conditions. After facing major challenges in 2023, including high input costs, health risks (avian flu, swine fever, etc.) and growing environmental expectations, the livestock sector saw its production drop in 2024 in the pork and beef sectors. The poultry industry, which has barely recovered from the damage caused by bird flu, started to pick up despite low margins. Its future (like that of many other industries) largely depends on market conditions, geopolitical developments, health crises and the support policies that are introduced. Against this backdrop, in December 2024 the Commission concluded a draft trade agreement with the MERCOSUR, which some countries consider obsolete. The Commission Presidency claims that the agreement aims to strengthen integration and trade between European countries and those of Mercosur (Brazil, Argentina, Paraguay and Uruguay), while guaranteeing food quality and safety standards. The Copa-Cogeca, the main organisation representing European farmers, is unanimously opposed to this agreement. This firmness and unanimity are unique enough with regard to a trade agreement to be worthy of note.

The European elections in June 2024 revealed a significant change in agricultural representation within the European Parliament, particularly within the French representation. Despite the crucial importance of the agricultural sector, and without prejudging the quality and working capacity of the new MEPs, the non-re-election of certain MEPs with an in-depth knowledge of the issues, such as Anne Sander, may be viewed as a weakening or even a loss of influence. The choices made by political parties when drawing up their lists raise concerns as to whether the preoccupations of the rural world will be taken into account in future European policies. Farmers, who face major challenges (climate change, market fluctuations, regulatory changes), could see their interests being defended less effectively, at least in the short term, due to a lack of consistency in representation. 

But hope should not be lost: the year 2024 also highlighted the need for a renewed Common Agricultural Policy, that can respond to climatic, economic and social demands. An agriculture geared towards innovation and sustainability can become a pillar of Europe's ability to tackle current crises while building a prosperous and balanced future for all European citizens. At least that is what the composition of the new European Commission suggests. Agriculture is doing better for itself with a dedicated Commissioner for Agriculture and food, which suggests a possible increase in its scope. Agriculture is listed as an area of concern and in the mission statements of several Commissioners. This is a notable return to favour, especially when we compare the situation at the beginning of this mandate with the previous one, when agriculture was relegated to the sidelines of strategic considerations.

The new European Commission: between ambition and reality, what agricultural future for Europe?

Looking at the dynamism displayed by President Ursula von der Leyen and her College of Commissioners, one question emerges: is the European Union ready to meet the challenges it has set itself? In a world beset by multiple crises, it describes itself as the architect of its own resilience, but its ambitions sometimes sound like promises too big for an institutional machine that is still too slow. Competitiveness has become the watchword of the 2024-2029 term of office, but can this competitiveness really be combined with an ever-exponential increase in sustainability standards? Reducing administrative burdens, decarbonising the economy and giving substance to a pact for ‘cleaner’ agriculture are laudable objectives, but how can we guarantee that they will actually be achieved without affecting our productivity or without an appropriate additional budget? Teresa Ribera Rodriguez, Vice-President for a Clean, Fair and Competitive Transition, talks of anchoring social justice and climate imperatives, but tensions between Member States over environmental policies could well limit the scope of this approach.

Agriculture, the historical pillar of European policies, has been entrusted to Christophe Hansen. The brother of a Luxembourg farmer, he promises to tackle the climatic, economic and generational challenges affecting the agricultural sector. His priorities include competitiveness, resilience and sustainability, with greater support for small farmers and sustainable farming practices. He wants to work on a strategy to attract young farmers and protect rural areas. At the same time, Olivér Várhelyi, Commissioner for Animal Health and Welfare, with his ‘One Health’ approach, is placing emphasis on the interconnection of human, animal and environmental health. Given the growing challenges to health, particularly pandemics and food security, this is a major concern for breeders and farmers alike. Against this backdrop, Raffaele Fitto, Vice-President in charge of cohesion and reform, will have to juggle often contradictory expectations: reducing regional disparities while at the same time stimulating innovation and strengthening infrastructures. The Cohesion policy, long seen as an essential tool, is perhaps not sufficiently used by an agricultural sector that is very (too) focused on its own tools integrated into the CAP, particularly when it comes to supporting innovative businesses and start-ups. The same applies to skills development, led by Roxana Mînzatu. Responsible for people, skills and education, she aims to be the cornerstone of a European Union adapted to changes in the labour market. While initiatives such as Erasmus+ show the way, the structural reforms that are essential to the success of the Skills Union, which European agriculture will need, are slow in coming: when will a Europe of training, research, innovation and agricultural start-ups emerge?

Finally, “being close to Europe’s citizens”, the mantra repeated by Ursula von der Leyen, remains an ambition that appears difficult to achieve. How can European citizens, who are often critical of a bureaucracy perceived as remote, be convinced that this Commission is acting in their interests? The new European Commission is positioning itself as a driving force for change in an uncertain global context. But between its stated ambitions and structural obstacles, there is a long way to go. Every European holds part of the solution: Europe's citizens must play their part and, beyond political considerations, understand Europe as a tool to be used in the common interest. This is what is being proposed through the strategic dialogue on the future of agriculture in the European Union.

Launched in January 2024, the strategic dialogue on the future of agriculture has emerged as a major initiative for the Commission to break a deadlock following the failure of the “Farm to Fork” initiative. A major first in terms of both content and form, this strategic dialogue was organised as a forum for exchange between a limited number of players, bringing together agricultural representatives, NGOs and academic bodies which lasted until September 2024. The conclusions of the dialogue presented by Professor Strohschneider offers a real catalogue of realistic solutions to environmental and economic challenges.

However, one question stands out: while all the measures proposed are based on a point of agreement between all the participants, the budgets required for agricultural transitions are not currently sufficient within or outside the framework of the Common Agricultural Policy (CAP). So how is the European Union going to finance the proposals already on the table and those to come? The crux of the matter, and the success of Ursula von der Leyen's two terms of office in the area of agriculture, will largely depend on this aspect. In this respect, Copa-Cogeca's call for each new agricultural policy to be backed up not by an impact study but by one addressing feasibility, to ascertain how much it will cost and who in the value chain will have to pay the costs of the transition, makes sense.

Ultimately, while we can only deplore the fact that the representation of farmers in this dialogue is not as strong as it should be, the report contains many proposals that deserve close attention, and this new method of ‘strategic dialogue’ seems so attractive that the Commission is in the process of reproducing the model for other sectors in crisis, such as the automotive industry.  

In this context, how can we ensure ecological transition without sacrificing the economic viability of farms, particularly the smallest ones, which are often the first to be affected by these far-reaching changes? Competitiveness must remain central to our recommendations, but it faces a triple crisis: environmental, economic and geopolitical. Everyone must admit that it is an illusion to think that farmers will be able to meet these challenges under the pressure of yet another set of regulations and directives. Commissioner Hansen's proposal for an initial simplification regulation upon his arrival in December 2024 was a positive step. It is to be hoped that, from the Commission to the Council via the Parliament, the European institutions can find the right words and promote the emergence of the necessary tools to convince farmers that it is essential to move on to a new stage of optimising farming practices based on the adoption of modern, sustainable technologies within the reach of as many people as possible. To succeed, it will first be necessary to understand that we are not starting from scratch. A great many things have already been put into practice by farmers, and for a long time have been proving that adaptation and initiative are their primary skills. 

Farmers are the pillars of Europe's food systems, but their role is often undermined by unfair trading practices and fluctuating prices. Action is required to counter the pressures of a globalised market in which European farmers often find themselves in a weak position. Although last December Christophe Hansen proposed a first package of corrective measures regarding unfair trade practices to improve the first directive of 2019 on the subject, the latest positions taken with regard to MERCOSUR do not really go in this direction. Harmonising environmental objectives and international trade appears to be a necessity. A global approach to the European agricultural ecosystem is vital, but the call for a systemic approach and aligned policies raises another question: how can European ambitions be achieved in the face of major national disparities? The transition to sustainable agri-food systems is an interesting avenue, but it will take time and colossal investment. The proposed approach of educating consumers is also worth considering: our food comes at a price, and consumers need to take responsibility for it. If measures along these lines are to be implemented, it will be some time before any significant impact is seen.

From producer to consumer, innovation is presented as a key to transition. Digitisation, automation and advanced agricultural technologies are strategic axes to improve efficiency and sustainability. The promotion of precision farming and science-based solutions is an opportunity. It must be combined with a proactive policy to encourage innovation and the development of European solutions, in particular through support for SMEs and start-ups, all of which are not included in the Draghi Report; the agricultural chain has been largely overlooked. Collaboration between public, private and academic players will be essential to meet these challenges. 

Towards a resilient and sustainable European agriculture: between adaptation and rearmament in the face of crises

The future of European agriculture depends on a delicate balance between ambition and realism. Will Europe be able to transcend its contradictions to become a global model of innovation and sustainability, or will it remain a prisoner of its institutional inertia? Now is not the time for promises, but for tangible results that meet the expectations of consumers AND farmers.

This involves targeted investment in innovative solutions such as Artificial Intelligence and biosolutions, as well as developing new forms of support capable of guaranteeing our food sovereignty and security. Inspired by North American models of loan deficiency payments, the introduction of risk management mechanisms, coupled with environmental commitments, could secure farmers' incomes while promoting a fair ecological transition.

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To transform crises - be they climatic, geopolitical or economic - into opportunities, European agriculture needs to reassert its strategic role, boosting its competitiveness while preserving its values of sustainability and solidarity. This ambitious project requires strong political support, a budget commensurate with needs and collective mobilisation, to allow Europe to maintain and even strengthen its place on the world's agricultural map.

Publishing Director : Pascale Joannin

The challenges facing European agriculture: Crisis or opportunity for transforma...

PDF | 167 koIn English

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