A long-awaited CAP reform deal hangs in the balance, with farm leaders openly conceding that an end-of-June deadline once seen as crucial may now be missed.

With little more than a fortnight to go before Ireland hands over the EU presidency to Lithuania, major sticking points include a ceiling on direct payments for large farms, greening, and how to distribute payments more fairly across the EU.

DEFRA secretary Owen Paterson said: “I think there’s a 60:40 sporting chance we will get a deal on CAP reform under the Irish presidency. If not, next year’s EU parliamentary elections will delay any deal even further.”

Mr Paterson was speaking to Farmers Weekly after EU farmers’ body Copa-Cogeca wrote to the European Parliament warning failure to meet the deadline could lead to years of uncertainty for growers and livestock producers.

A deal was vital to ensure a viable EU agri-food sector, said Copa-Cogeca secretary general Pekka Pesonen. “We clearly do not want a deal at any price, but we do not believe that prolonging the talks beyond June will achieve anything,” he said.

“Positions are known. All sides just have to compromise. If no agreement is reached now, it could be years before one is got, causing uncertainty for farmers and political instability. This is the last thing farmers, or indeed Europe, need.”

Talks are set to go to the wire with little compromise ahead of the final farm council meeting under the Irish presidency, which starts in Luxembourg on 24 June. Lithuania takes on the presidency for the first time from 1 July.

Ulster Unionist MEP Jim Nicholson, agriculture spokesman for the European Conservatives and Reformists group, agreed it was “extremely unlikely” the right agreement could be achieved in the tight timeframe that remains under the Irish presidency.

The warnings came as NFU president Peter Kendall said the government’s drive for modulation was masking its failure to secure a fair deal from Brussels for farmers from the country’s “Pillar 2” rural development programmes.

Speaking at this week’s Cereals 2013 event, Mr Kendall said the latest numbers confirmed the UK would be allocated the lowest share of funds of all member states on a per hectare basis. Farmers faced significant reductions compared with the current budget, he said.

“Despite the rhetoric we have heard from the government about the importance of the Pillar 2 rural development and its willingness to fight for a fair deal for English farmers, negotiators have come back from Europe in a worse position than we started.”

UK farmers had started with very little but would now get even less. The allocation would fall by 16% in the first year of the programme, rising to cuts of 27% in the final year – equivalent to a 22% drop over the seven-year period compared with rolling on the 2013 budget over the same period.

By 2020, UK farmers would see less money coming back to the UK than they contributed across into the pot by way of the compulsory EU modulation transfers in 2013, Mr Kendall said.

“At the same time, other countries like France, Italy and Ireland have managed to secure special offerings. The French got an extra €1bn, the Italians €1.5bn and even the Finnish got €600m.

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