On 1 May 2004, ten former candidate countries became new members of the European Union. The new situation on the common market will bring along not only positive developments, but also reveal new weaknesses. The article is based on the final results of two research projects: Possibilities of Balancing Rural Economy Prior to and after Accession to the European Union (Estonian Scientific Foundation, Grant No. 4693) and Agricultural Sector in the member states of EU and Newly Associated States: Econometric Modelling for Projections and Analysis of EU policies on Agriculture, Forestry and the Environment (AG-MEMOD Partnership, 5th Framework Programme). On the background of price convergence we need to get right answers to the following key questions: Which are the main factors affecting food prices development after accession? How fast will input and output prices converge in the food sector? How to evaluate the disproportion of prices between the old and the newly associated states? Have we and how long will we have certain competitive advantages on the EU food market? Are the new CAP support measures good enough to create the favourable environment for competitiveness? How to evaluate the food market distortions on the Common Market? According to the prices convergence theory, the input and output prices are indirectly dependent on the macroeconomics and directly on the microeconomics environment
