Support to agriculture rising after hitting historic lows, OECD says

Posted by on September 20th, 2013 | 0 Comments »

The information below was originally posted by the Organisation for Economic Co-operation and Development (OECD) on September 18, 2013. Read the excerpt and click the link below for the full release.

Support to agriculture rising after hitting historic lows, OECD says

Government support for agriculture in the world’s leading farming nations rose during 2012, bucking a long-term downward trend and reversing historic lows recorded in 2011, according to the latest version of an annual OECD report.

Public support to producers stood at an average one-sixth of gross farm receipts in the 47 countries covered in OECD Agricultural Policy: Monitoring and Evaluation 2013. The Producer Support Estimate has increased to 17% of gross farm receipts in 2012, compared to 15% in 2011, according to the new analysis.

The OECD sees a generalised move away from support directly linked to production, but finds that support that distorts production and trade still represents about half of the total. While OECD countries are increasingly de-linking support from production, emerging markets are relying more on border protection and market price support measures that tax consumers.

“With world markets for food and commodities buoyant and higher commodity prices expected to continue, the time is ripe for governments to credibly commit to wide-ranging farm support reform,” said OECD Trade and Agriculture Director Ken Ash. “Meeting the needs of a growing and richer world population requires a shift away from the distorting and wasteful policies of the past towards measures that improve competitiveness, allowing farmers to respond to market signals while  ensuring that much-needed innovation is fully funded,” Mr Ash said.

This year’s OECD report examines the state of agricultural policy in 47 countries that account for nearly 80% of global farm output, including seven emerging economies that are major players in food and agriculture markets: Brazil, China, Indonesia, Kazakhstan, Russia, South Africa and Ukraine. It shows that support levels vary widely, both across the OECD countries and across major emerging economies.

OECD Farm SupportIn the OECD area, support to producers stood at $258.6 billion (EUR 201.2 billion) in 2012. Support represented 19% of farm receipts in the OECD, up from 18% in 2011. The report points to sharp divergences behind these figures, with the countries that offer farmers the highest levels of support recording increases (Japan 56%, Korea 54%, Norway 63% and Switzerland 57%) while relatively low-support countries fell further (Israel 11%, Mexico 12%, United States 7%). Support remained very low in others (Australia 3%, Chile 3%, New Zealand 1%).

Read more from OECD here.

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