Impact of the Berlin Accord and European Enlargement on Dairy Markets, The

Using a world agricultural model, we analyze the impact on dairy markets of the Berlin Accord on the European Union (EU) Common Agricultural Policy (CAP) Reforms. We also investigate the consequences of enlargement of the EU to include the Czech Republic, Hungary and Poland for the same markets. We produce a market outlook up to 2010 for these two scenarios. The Berlin Accord induces lower EU milk and dairy prices. A change in relative prices between cheese and butter-skim milk powder (SMP) occurs after 2005 and induces an expansion of cheese production, consumption and exports at the expense of the butterï¾–SMP sector. Accession of the three central and eastern European countries (CEECs) leads to a permanent but moderate decrease in EU prices of milk and dairy products. For the three acceding CEECs, domestic prices increase dramatically. Their final consumption of milk decreases and dairy product consumption drops considerably. The derived demand of milk in dairy production increases, however, because of the higher prices for dairy products, benefiting dairy producers in these CEECs. Dairy exports of the three acceding countries to the EUï¾–15 increase by one to three orders of magnitude, despite building large inventories. The impact of accession on world markets is small.

The Impact of the Berlin Accord and European Enlargement on Dairy Markets

This paper analyzes the effect on dairy markets of the Berlin Accord and the European Union (EU) Common Agricultural Policy (CAP) reforms. It also investigates the consequences of the EU enlargement to include three Central and Eastern European countries (CEECs), the Czech Republic, Hungary, and Poland, with sizeable agricultural and dairy markets. While the analyses are dependent on a series of assumptions relating to the functioning of EU markets and the future world agricultural and macroeconomic situations, the paper concludes that CAP reforms resulting from the Berlin Accord are likely to create substantial changes in the European agricultural markets. Policy changes in the dairy sector in addition to the accession of the three CEECs will lead to a permanent but moderate decrease in EU milk and dairy product prices

The Impact of The European Enlargement and CAP Reforms on Agricultural Markets. Much Ado about Nothing?

We analyze the effects of the 2004 CAP reform and EU enlargement on European and world agricultural markets. We compare the results from a CAP reform only and a CAP reform plus enlargement scenarios to a no-enlargement baseline implementing Agenda 2000 CAP policies. We utilize the Food and Agricultural Policy Research Institute's policy analysis model to simulate the effects of CAP reform and EU enlargement on production, consumption, and trade for the EU, its New Member States (NMS), and major players in world agricultural markets. The model is a partial-equilibrium model of world agricultural markets including important producer and consumer countries in world livestock and products, dairy, grains, oilseeds and products, cotton and sugar markets. Each country's commodity sectors are modeled with structural equations which incorporate all important policy parameters. With prices in most commodities in the NMS historically below EU-15 prices accession leads to substantial price increases for many commodities in the NMS. Higher prices stimulate production and dampen consumption in the NMS, and trade between the new members and the EU-15 increases. Prices in the EU-15 decrease moderately. The impact of the two reforms on world markets is negligible. The CAP reforms have their greatest impact in the EU-15 markets for meats, rice, rapeseed, and dairy products. CAP reforms without enlargement generate a small increase in world and EU commodity prices.CAP, trade reform, policy reform, enlargement, new member states, European Union, Agricultural and Food Policy, Marketing, F1, Q17, Q18,

The Common Agricultural Policy and EU Enlargement: Implications for Agricultural Production in the Central and Eastern European Countries

This paper focuses on the consequences that an extension of the Common Agricultural Policy could have on agricultural production in the Central and Eastern European Countries. It reviews the evidence presented by recent attempts to quantify the potential impacts of accession on production levels in the CEECs. It also takes into account results from previous studies in order to analyse the importance that structural constraints might have on the capacity of the CEECs' agricultural sectors to respond to supply incentives under accession to the EU, and to examine some research questions that are still unanswered in relation to the supply potential of the CEECs. Some conclusions and policy recommendations are drawn at the end.CAP, CEECs, EU enlargement, supply response, structural constraints., Agricultural and Food Policy,

Accession of the Czech Republic, Hungary and Poland to the European Union: Impacts on Agricultural Markets

We analyse the consequences on agricultural markets of enlargement of the European Union (EU) to include the Czech Republic, Hungary, and Poland. We produce a market outlook up to 2010 for two enlargement scenarios assuming different policy restrictions on grain and dairy production in the acceding countries. Accession of the three Central and Eastern European countries (CEECs) leads to a permanent but moderate decrease in EU prices for most commodities. In the three acceding CEECs, domestic prices increase drastically, final consumption of agricultural products decreases in most instances, while production increases. Higher domestic prices in the CEECs reduce exports of most commodities to non-union countries. Consequently, excess supplies are placed in stocks or exported to the original 15 member countries. Supply management mechanisms in the dairy and grain sectors would reduce the build-up of surpluses in the new member states, but limit their ability to take advantage of the expanded market. Accession of the three CEECs would increase the CAP budget over its proposed maximum if area payments are extended to incoming crop producers

Accession of the Czech Republic, Hungary, and Poland to the European Union: Impacts on Agricultural Markets

Using a world agricultural multimarket model, we analyze the consequences of enlargement of the European Union (EU) to include the Czech Republic, Hungary, and Poland for agricultural markets. We produce a market outlook through the year 2010 for two enlargement scenarios, which are based on different assumptions regarding the restrictions on grain and dairy production in the acceding countries. In both scenarios, accession of the three Central and Eastern European countries (CEECs) leads to a permanent but moderate decrease in EU prices for virtually all commodities. For the three acceding CEECs, domestic prices increase dramatically. Their final consumption of agricultural products decreases in most instances, while production rises. Higher domestic prices in the CEECs reduce exports of most commodities to non-union countries. Consequently, excess supplies are placed in stocks or exported to the original 15 member countries. The imposition of supply management mechanisms in the dairy and grain sectors reduces the buildup of surpluses in the new member states. However, supply constraints limit the ability of the new members to take advantage of the expanded market

Modeling Agricultural Trade Liberalization. A Review.

The paper reviews the models used in the past 10 years or so to analyze the expected effects of liberalizing agricultural trade. The main aim of the paper it to provide the reader with an overview of models which have been used to assess, first, during the Uruguay Round, the implications of alternative hypothetical trade liberalization scenarios, then, the Agreement itself, and, more recently, the implications of further steps in liberalizing agricultural markets as a result of the on going WTO negotiations. The conclusion reached is that the efforts to model agricultural trade and trade policies, taken as a whole, are not fully satisfactory. Although several models offer accurate representations of international agricultural markets and trade policies, many others, including several developed and used by governments and relevant multilateral institutions, are structurally incapable of providing reliable answers to some of the policy questions they are asked to address. The final part of the paper identifies priorities for actions to be taken for improving modeling of trade policies and WTO commitments.International Relations/Trade,

Assessing the Economic Impacts of Incorporating Romania's Agricultural and Food Sectors into EU's Customs Union: an Applied General Equilibrium Approach

Joining the European Union club implies, among many other policy changes, full integration of Romania's economy into EU's customs union. This is expected to have significant implications for domestic farmers and food processors. The paper constructs a single-country Applied General Equilibrium (AGE) model to investigate the impact of tariff border adjustments on changes in relative prices, production and trade patterns associated with fifteen local agro-food activities. Moreover, the modelling work identifies those agro-food sectors that have the potential to benefit the most from EU enlargement in terms of output effects given that Romanian producers are capable of fully responding to the incentives provided with integration. These mainly include (bovine) live animals and meat products, sugar, and cereal grains. Agro-food trade with EU intensifies in particular for those commodities for which trade restrictions are still substantial prior to accession. However, the magnitude of changes is relatively small due to the weak integration of domestic agro-food sectors into international trade structures. The AGE model also predicts static welfare gains of 0.65 percent of GDP equivalent variation. These seem to be more associated with better access to EU markets and increased export prices, and less with the preferential unilateral elimination of tariffs or their adjustment to EU's external levels. The model assumptions are highly theoretical and the model structure does not reflect with fidelity the workings of an economy in transition. Nonetheless, it does represent a solid base upon which further improvements could be added and structural transitional issues could be attached to more accurately predict potential outcomes.EU enlargement, Customs union, Agriculture, Romania, AGE modelling

Assessing the Economic Impacts of Incorporating Romania's Agricultural and Food Sectors into EU's Customs Union: An Applied General Equilibrium Approach

Joining the European Union club implies, among many other policy changes, full integration of Romania's economy into EU's customs union. This is expected to have significant implications for domestic farmers and food processors. The paper constructs a single-country Applied General Equilibrium (AGE) model to investigate the impact of tariff border adjustments on changes in relative prices, production and trade patterns associated with fifteen local agro-food activities. Moreover, the modelling work identifies those agro-food sectors that have the potential to benefit the most from EU enlargement in terms of output effects given that Romanian producers are capable of fully responding to the incentives provided with integration. These mainly include (bovine) live animals and meat products, sugar, and cereal grains. Agro-food trade with EU intensifies in particular for those commodities for which trade restrictions are still substantial prior to accession. However, the magnitude of changes is relatively small due to the weak integration of domestic agro-food sectors into international trade structures. The AGE model also predicts static welfare gains of 0.65 percent of GDP equivalent variation. These seem to be more associated with better access to EU markets and increased export prices, and less with the preferential unilateral elimination of tariffs or their adjustment to EU's external levels. The model assumptions are highly theoretical and the model structure does not reflect with fidelity the workings of an economy in transition. Nonetheless, it does represent a solid base upon which further improvements could be added and structural transitional issues could be attached to more accurately predict potential outcomes.EU enlargement, Customs union, Agriculture, Romania, AGE modelling, Political Economy, D58, F15, O13,

EU Policy-Making: Reform of the CAP and EU Trade in Beef & Dairy with Developing Countries

The present study is part of the PPLPI effort to identify significant political and institutional factors and processes that currently hinder or prevent the poor in developing countries from taking greater advantage of opportunities to benefit from livestock. The study examines the political economy of policy-making concerning trade in livestock and livestock products (LLPs) between the European Union (EU) and developing countries (DCs). The main objective is to determine and assess how relevant EU policy is made, including the role of key actors and forces both domestic and international. The political economy of relevant LLP trade-related issues are examined at four levels: (a) the EU member state, (b) the European Union itself, (c) the international trading system, and (d) developing countries. Several issues cross, or are relevant to, the different levels of analysis. A related objective is to identify "entry points" and provide strategic recommendations aimed at achieving positive change. Two livestock commodities, beef and dairy, were selected as central to the study. The EU is a prodigious producer of livestock and livestock products, and it plays a major role in international trade in LLPs. EU subsidies and trade barriers have been the subject of intense criticism by some European Union member states, developed and developing country trading partners, international organizations, academics, advocacy NGOs and others.European Union, Common Agricultural Policy (CAP), Policy Making, Trade, Developing Countries, Livestock, Beef, Dairy, Agricultural and Food Policy, Livestock Production/Industries,