No less than a third of the entire EU budget goes to agriculture, and yet several Flemish farmers are fighting to keep their heads above water. One in four Flemish farmers even lives below the poverty line and one in seven suffers a loss. The N-VA MPs therefore want farmers to gain more market power. Sofie Joosen: “Setting up producer organizations can be an important step forward. As a government, we must support and simplify this,” she says.
The agricultural sector consists mainly of fragmented small family businesses. They often find themselves in a weak bargaining position vis-à-vis strong, large supplier and buyer companies. This lack of market power causes them to lose income. To correct this imbalance of power, farmers must be able to unite. This is possible under a recognized producer organization. This way, farmers can make agreements together, join forces and be stronger during negotiations.
Europe allows it
European competition policy, which normally prohibits cartel formation, allows this exception within agricultural policy. Geert Bourgeois investigated this and was confirmed by European Commissioner for Competition Margrethe Vestager. She acknowledged that farmers who take advantage of the exception effectively receive better prices for their products. Many farmers are not aware of this exception. According to Johan Van Overtveldt, this would also have positive consequences for the European budget. “Given the pressure on the budget, it is a matter of time before European agricultural subsidies are threatened. By giving more market power to the farmer, we create more budgetary space.”
The parliamentarians call on Flemish Minister of Agriculture Jo Brouns (CD&V) to promote the establishment of agricultural producer organizations through awareness campaigns and to reduce the administrative burden of establishing such organizations. This could be done with so-called de minimis support worth 25,000 euros.