European fruit and vegetable producer organisations will benefit from simpler rules, a reduced administrative burden and greater financial support in times of crisis thanks to new legislation that comes into force on 1 June 2017.
In particular, the updated and simplified delegated regulation of the European fruit and vegetable sector will further strengthen the role of producer organisations (POs) by making them more attractive to non-members, while at the same time improving the functioning of the existing market management scheme.
Every year, some €47 billion of fruits and vegetables are produced by 3.4 million holdings across the EU, roughly a quarter of all EU farms. According to the latest available figures, there were around 1 500 POs covering 50% of the EU fruit and vegetables production.
Since the Russian embargo on EU agri-food imports in August 2014, the EU has helped support fruit and vegetable growers through €442 million in extra funding. The European Commission also provides additional funding for POs of about €700 million every year.
Among the changes introduced by the new rules will be more support for the fruit and vegetable sector when products have to be removed from the market due to unforeseen market developments. So-called withdrawal prices will increase from 30% to 40% of the average EU market price over the last five years for free distribution (so-called charity withdrawals) and from 20% to 30% for withdrawals destined for other purposes (such as compost, animal feed, distillation, etc.).
The new rules are also designed to make POs in the fruit and vegetable sector more attractive to producers that are currently not members, by making it clearer which actions by producer organisations can be eligible for EU funding support (for example, investments in technology or quality improvement).
Although PO members are encouraged to deliver their whole production to the organisation to market on their behalf, many also have a tradition of direct selling to consumers, and the Commission is keen to ensure that this tradition of direct supply to local markets continued. The new rules therefore set the maximum percentage of produce that can be marketed outside the organisation in this way at 25%, replacing the former system of a minimum threshold set at EU level and a variety of different maximum thresholds set at national level.
Finally, the rules governing transnational producer organisations and their associations have also been made simpler and clearer to understand in a bid to encourage more cross-border marketing of products.
POs can make use of the new provisions for next programming year (2018).
Through its common market regulations, the EU encourages farmers to set up producer organisations in order to strengthen their position on the market through a stronger bargaining position with the retail sector, as well as through production planning, innovation and crisis prevention, and management measures.