16 August 2002

Positive forecast for farm incomes

GERMAN farm incomes will be almost unaffected by the mid-term review of Agenda 2000, though there will be significant structural changes, according to a study by the Research Association for Agricultural Policy in Bonn.

The researchers anticipate a two-thirds increase in the area of set-aside, as more marginal land is put into long-term agri-environment schemes. As a result, the combinable crop area is expected to fall by 8.5%, with a corresponding drop in output.

The other sector to be affected is beef, where production is forecast to fall 15% to just over 1m tonnes/year, primarily due to increased extensification following the move from headage payments to decoupled area payments.

But, despite these production declines, net farm incomes are predicted to hold steady. &#42