The need to regulate agricultural markets
Analysis and proposals in view of the recent food price crisis
The context in which the question of agricultural market regulation needs to be considered has changed drastically as a result of the events of the past two years.
From the early 1980s onwards and for a period of over twenty years the problems of agricultural markets resided mainly in chronic surpluses and rock-bottom prices – although paradoxically these coincided with continuing shortages for very large population groups.
Over the same period globalisation gathered pace, bringing with it a general trend towards deregulation and market liberalisation which was supported by the international institutions (OECD, WTO, WB, etc.) and accepted by national governments.
In this context of chronic surpluses the risks were shouldered mainly by the producers who were underpaid for their produce. These risks were further aggravated by the process of liberalisation and deregulation. Consequently neo-liberal theoretical approaches based on decoupled aids and income insurance systems have flourished.
Recent events have changed the equation and made the situation far more complex. They have multiplied the risks and the number of parties affected. They challenge the validity of overly simple theoretical approaches to agricultural policy.
The key event to be considered here is the explosion of certain agricultural commodity prices in 2007-2008 and its multiple knock-on effect on consumer food prices. Energy prices and the prices of certain raw materials also rose considerably at the same time. A relative scarcity of natural resources began to affect markets. To this must be added – although the event is more recent and its outcome still uncertain – the current financial turbulence, the immediate result of which has been to put market regulation back on the agenda.
These events and their dissimilarity with previous circumstances force the public authorities to prepare for a far more complex situation. Agricultural product prices can create problems whichever way they move. The long term trend - previously downwards - now appears to have been reversed and volatility has increased. The types of risks that have to be considered are far more disparate – they might take the form of excessively high consumer prices or excessively low farm prices. High volatility of import prices is negative for all concerned – it jeopardises food security in the urban areas of some developing countries. Not only farmers are affected by these risks, so are consumers and even stability-seeking agri-food industries.
The changing situation poses a challenge to simplistic theoretical approaches relying on agricultural policy instruments that only work in a single set of circumstances and are founded on the assumption of perfectly functioning markets. They invite more serious scrutiny of the possibility of market imperfections and the whole issue of market regulation. Regulation can help adjust prices upwards or downwards, avoiding extremes. It can attenuate price volatility and improve food security by encouraging local supply strategies for urban areas in developing countries. Its requirements in terms of public funding are moderate.
The objective of the seminar is to re-examine the question of of agricultural market regulation in this new context.
Specific objectives of the conference
1. Improve the analysis of the new context of increased price volatility, identify their causes and their risks (for small holders, but also for consumers, access to food, access to natural resources…) both within the national and international context.
2. Analyse the variety of political responses (market based, right to food, food sovereignty,…) and exchange from different contexts what the role of public policies should be, and in particular the possible use of market regulation instruments to respond to the food crisis and their risks.
3. Identify common points of interests and assess specific instruments of trade and agricultural policies that have been taken at national and international levels that can be strengthened or that should be reviewed or opposed.
4. Develop proposals of common strategies for short and longer term, enlarging the participation to other important stakeholders (NGOs, consumers and trade unions).
The workshop is organised by a steering group of farmers organisation (Belgian Beet Growers, European Coordination Via Campesina, ROPPA from West Africa and FETRAF from Brasil) together with NGO in support of the process (CSA and Oxfam-Solidarity).
During the two-day workshop, there will be translation into French, English and Spanish.
The workshop is open to representatives of farmers’ organisations and NGOs from developing countries and industrialised countries. The core group of farmers’ organisations will be the signatories of the Dakar and Chapeco Declaration but there will also be some new participants. A ceiling of 65 participants has been set.
Priority will be given to participants who attended the formers meetings. A small number of resource persons (rural economists specialising in agricultural and trade policy) will provide assistance at the workshop as well as representatives of NGOs.
The workshop will take place at the residential seminar house :
Maison Notre-Dame du Chant d’Oiseau
Avenue des Franciscains 3a
Tel : 0032 – (0)2 761 42 81
Financial support The seminary is financially supported by the Belgian Development Cooperation (DGCD, Service public fédéral Affaires étrangèes, Commerce extérieur et Coopération au développement) (http://www.dgcd.be)
Monday , May 4th, 2009
|08:30 Arrival of the participants|
|09:00 Welcome speech - Presentation of the participants, the objectives and the sequence of the seminar, by Ndiogou Fall (roppa)|
|09:10 Introduction : the evolution of the international context since the seminar in Chapeco in 2005, by Yves Somville (fwa)|
SESSION 1 : SITUATION AND CAUSES OF THE CRISIS OBSERVED SINCE 2007-2008
|09:20 The end of a long downward trend? -Analysis of the basic elements influencing the evolution of the prices of staple products in the long term,|
Daniel De la Torre De Ugarte (University of Tennessee, USA)
|09:40 The great volatility of prices since 2007/08 – Analysis of the factors linked with the economic situation in that period and of the speculative factors which intensified increases. ,|
Benoît Daviron (CIRAD, France)
|10:00 Opportunism in downstream sector? Compared evolution of farm and food prices at European and international level ->http://www.csa-be.org/IMG/pdf_Bourgeois.pdf] |
Lucien Bourgeois(APCA, France)
SESSION 2 : THE SIDE-EFFECTS OF THE GREAT VOLATILITY OF AGRICULTURAL PRICES AND THE HIGH LEVEL OF FOOD PRICES
|11:25 Identification of the effects (risks and opportunities, distinct according to groups…) – Introduction,|
by Jean-François Sneessens (UCL, Belgium)
|11:35 Working groups (enlargement of the reflection thanks to the personal experiences and taking into account the diversity of situations)|
|14:30 Report of the working groups|
SESSION 3 : VERY DIFFERENT REACTIONS - A MAJOR CHOICE
(headlong pursuit and laissez-faire versus recognition of the population’s rights and re-examination of the role of authorities?))
|14:50 The still mainstream official position (WTO,OECD,…): more liberalisation – The situation after the G14 on food in Treviso |
by Alex Danau (csa)
|15:00 A basic approach: The right to food ,|
Olivier De Schutter, , UNO Special Rapporteur
|15:15 The answer of Food Sovereignty,|
by Javier Sanchez. (European Coordination Via Campesina)
(reflection on the choice of instruments facing the crisis)
|16:30 The different options facing the problem of price volatility,|
par Jean-Marc Boussard (inra, France)
|16:45 Tariffs and regulation of agricultural markets: which role in a globalised economy ?|
Niek Koning (Univ. Wageningen, Pays-Bas)
|18:00 End of the first day.|
Tuesday May 5th,2009
SESSION 4 : EXPERIENCES AND ACTION TRACKS
|08:35 Market access for farmers on local level|
Reduction of the imbalance in trade relations , reinforcement of transport infrastructures
by Yves Leduc (PLC, Canada) and EstherPenunia (AFA, Asie)(ppt (pdf))
|09:05 Access to food for poor consumers – The Brazilian experience(ppt (pdf), texte (word)),|
by Crispim Moreira (Nat. Secretary of Food Security and Nutrition, Brésil)
|11:05 Access to the means of production for family farmers or “ land grab” ?|
par Via campesina
|11:20 Agriculture policy and regional integration (tariffs, stock, market organisation, regional development)|
The case of the common external tariff of the CEDEAO, (ppt (pdf), texte en word),
by Babacar Ndao (ROPPA)
SESSION 5 : COMMON PRIORITIES AND STRATEGIES FOR ACTION
|13 :35 Identification of common priorities in the new international context. |
by Gérard Choplin (European Coordination Via Campesina)
|13:40 Working groups (enlargement of the reflection thanks to personal experiences and taking in account the diversity of situations)|
|15:15 Report of the working groups|
|15:30 Strategie and possibilities for action |
Altermir Tortelli (FETRAF, Brasil)
|17:20 Conclusions, by Thierry Kesteloot (Oxfam Solidarité, Belgique) ) and Saliou Sarr (CNCR)|
|17:30 End of the seminar|