Agriculture & economics

Abstract: Support for young farmers is an important objective in the EU’s agricultural policy framework, aiming to promote generational renewal as a means of enhancing the competitiveness and sustainability of the EU’s agricultural sector. This paper focuses on the economic prospects of young farmers by estimating the microeconomic impacts of rural development programme (RDP) support on the economic performance of young farmers in Poland and Germany between 2007 and 2012. Using the synthetic control method and Farm Accountancy Data Network panel data, we find that the support had mixed effects. In Poland, RDP-supported young farmers underperformed relative to their unsupported counterparts, probably due to the entry of less-performing farmers into the sector, high environmental compliance costs and/or insufficiently tailored policy design. Conversely, old farmers benefited more, probably due to their superior entrepreneurial skills and lower commitment to adopting environmental practices. In Germany, RDP support improved the performance of young farmers, suggesting that it probably addressed some market imperfections. These findings underscore the limitations of a one-size-fits-all approach to supporting young farmers and the need for region-specific policies. Policymakers should mitigate unintended consequences, such as incentivising less-performing entrants, and better tailor interventions to the needs of young farmers. While our findings are specific to Poland and Germany, they contribute to broader policy discussions on the effectiveness of agricultural support for young farmers and highlight the need for further research in different contexts.

Abstract: Food systems play a pivotal role in preserving the balance between environment and human activities. Their sustainability is key for operating within the planetary boundaries. The Joint Research Centre (JRC) published its first food system monitoring dashboard in November 2024, to provide information on progress towards a fair, healthy and environmentally friendly food system. In addition to selecting indicators for monitoring, the related work identified important knowledge gaps on food system sustainability. These gaps were marked with placeholders indicating research or data collection needs. This report describes the first phase of the evolutionary maintenance of the dashboard, providing overall context and methodological steps for turning placeholders into headline or secondary indicators. Importantly, the report also informs on how data in the monitoring system is managed, ensuring balanced and non-repetitive coverage of the environmental, economic and social dimensions, as well as the components of the food supply chain. The first phase of placeholder development yielded 15 new indicators in the dashboard- out of which 9 had been formulated as placeholders in the November 2024 report while 6 were newly proposed and developed indicators. These indicators draw on newly discovered public data, data derived from original research, and data resulting from the combination of public and commercial data sources. Beyond informing on the sustainability of the EU food system, the monitoring framework including the upgraded dashboard and this report, may also contribute to policy making on issues such as competitiveness, social inclusion and environment.

Abstract: The Scenar 2040 study provides a comprehensive analysis of the potential impacts of two hypothetical scenarios related to the Common Agricultural Policy (CAP) on the EU agricultural sector and its broader environment. The baseline (reference scenario) is calibrated to the 2023 EU Agricultural Outlook, and the current national CAP Strategic Plans serve as starting point for the shifts in the policy scenarios. In the first scenario support is directed towards CAP measures enhancing productivity and competitiveness, whereas the second scenario shifts support towards more environmental and climate-focused interventions. The study also includes a counterfactual NoCAP scenario, simulating the removal of the entire CAP framework. The study aims to contribute to policy discussions on the future of the CAP by providing quantitative insights into the general implications of alternative CAP trajectories. The scenario results underscore the CAP’s essential role for the EU’s agricultural sector and its broader socio-economic and environmental interlinkages across territories. The results indicate that the removal of the CAP framework would have considerable heterogeneous economic, environmental, and social impacts across the EU. The two alternative CAP scenarios reveal contrasted outcomes aligned with their respective narratives. The results highlight the CAP’s critical role, the complexity involved in balancing competing objectives, and confirm market fundamentals as primary drivers of production, although policy can significantly modulate outcomes.

Abstract: This report presents a two-step approach to rank European Union Quarantine Pests (UQPs) based on their potential economic, social, and environmental impacts. In the first step, a shortlisting methodology was developed and applied to approximately 400 UQPs to select a subset of pests which were subject to a more detailed analysis in the second one. The shortlisted 46 pests were evaluated using an updated and modified version of the Impact Indicator for Priority Pests (I2P2) a composite indicator based on multi-criteria analysis. To calculate I2P2 values expert knowledge elicitations were conducted by EFSA for key parameters and these combined with a diversity of secondary data sources. The I2P2 model combines economic, social, and environmental impact into a single value which is subsequently used to rank pests. We assessed robustness of our recommendation with regards to uncertainty on the biological parameters as well as risk managers’ preference on avoiding impacts in the different domains. In addition we inform on the driving factors behind the composite scores.

Abstract: The global context has shifted dramatically since publication of the first EAT–Lancet Commission in 2019, with increased geopolitical instability, soaring food prices, and the COVID-19 pandemic exacerbating existing vulnerabilities and creating new challenges. However, food systems remain squarely centred at the nexus of food security, human health, environmental sustainability, social justice, and the resilience of nations. Actions on food systems strongly impact the lives and wellbeing of all and are necessary to progress towards goals highlighted in the Sustainable Development Goals, the Paris Agreement, and the Kunming–Montreal Global Biodiversity Framework. Although current food systems have largely kept pace with population growth, ensuring sufficient caloric intake for many, they are the single most influential driver of planetary boundary transgression. More than half of the world's population struggles to access healthy diets, leading to devastating consequences for public health, social equity, and the environment. Although hunger has declined in some regions, recent increases linked to expanding conflicts and emergent climate change impacts have reversed this positive trend. Obesity rates continue to rise globally, and the pressure exerted by food systems on planetary boundaries shows no signs of abating. In this moment of increasing instability, food systems still offer an unprecedented opportunity to build the resilience of environmental, health, economic, and social systems, and are uniquely placed to enhance human wellbeing while also contributing to Earth-system stability. This updated analysis builds upon the 2019 EAT–Lancet Commission, expanding its scope and strengthening its evidence base. The first Commission defined food group ranges for a healthy diet and identified the food systems' share of planetary boundaries. In this Commission, we add an analysis of the social foundations for a just food system, and incorporate new data and perspectives on distributive, representational, and recognitional justice, providing a global overview on equity in food systems. Substantial improvements in modelling capacity and data analysis allow for the use of a multimodel ensemble to project potential outcomes of a transition to healthy and sustainable food systems.

Abstract: Studies analysing land managers’ stated preferences for participation in environmental policy initiatives have largely overlooked the issue of hypothetical bias (HB). In this study, a discrete choice experiment focusing on farmers’ willingness to accept (WTA) to participate in agri-environmental schemes is used to examine an HB mitigation measure. The ex post HB mitigation measure is based on perceived consequentiality, grounded in the notion that greater survey consequentiality implies greater survey credibility, prompting land managers to provide more realistic responses. The results show that such a measure can help to reduce HB, which can lead to WTA being overestimated by 35%, in line with recent meta-analyses focusing on WTA settings for private goods. The results also indicate that perceived consequentiality exhibits a kind of “knife-edge” effect, like that reported for WTP settings with public goods. Overall, the results support the value of accounting for and enhancing perceived consequentiality. While this study opens up different avenues for further research, it should help future valuations of this kind to provide more accurate estimates, enabling more precise policy-making support for land and resource managers.

Abstract: The digitalisation of the EU agricultural sector is an essential part of the broader EU Digital Agenda and the Common Agricultural Policy (CAP) aiming to promote competitiveness, sustainability, and resilience in agriculture through digital transformation. This report analyses the current state of digitalisation in EU agriculture, covering the adoption of general IT and software tools and farm-specific technologies, key drivers and barriers, perceived sustainability aspects, and farm-level practices in data collection, management and sharing. The analysis is based on farm survey data from 1 444 respondents in nine EU Member States – Germany, Ireland, Greece, Spain, France, Italy, Lithuania, Hungary and Poland – collected between June and October 2024. The results show that while general IT and software tools are widely used, more expensive technologies specific to crop or livestock production have been less widely adopted. Adoption rates are higher among larger farms, those with better internet connectivity and those with specialised training. Key drivers of adoption include efficiency gains, cost savings, regulatory pressures and improved quality of life, while high costs and limited skills remain notable barriers. Farmers expect digital technologies to have positive economic, environmental and social impacts. Farm-level data collection is still largely manual or based on basic digital tools, which increases the administrative burden on farmers. Farmers appear to take a selective approach to data sharing, mainly due to concerns about privacy, security and data control. Promoting transparent data policies, ensuring farmers benefit from sharing and adopting a targeted policy approach for advanced technologies can help build trust and support wider digital adoption.

Abstract: The European Climate Law mandates the European Union’s climate neutrality objectives by 2050, aligning with the European Green Deal and interim greenhouse gas (GHG) emission reduction targets. The Agriculture, Forestry, and Other Land Use (AFOLU) sectors play a crucial role due to their dual function in sequestering carbon and emitting GHGs. This report assesses the potential contribution of the AFOLU sectors to the EU's 2050 targets using CAPRI model scenarios. Recent model enhancements enable a more integrated analysis of GHG emissions and carbon removals, allowing for a detailed assessment of land-based mitigation options. The scenarios assess increased afforestation, sustainable forest management, protection of peatlands, and pricing of AFOLU GHG emissions and removals. Results indicate that reversing GHG emission trends requires significant action, particularly enhanced soil carbon sequestration and climate-smart agricultural practices. The protection of histosols and land conversion towards grassland and forest areas significantly increase carbon dioxide removals, while lower livestock and crop production reduce methane and nitrous oxide emissions. Policies strengthening forest protection and afforestation further enhance the carbon sink capacity of the AFOLU sectors, potentially achieving negative net emissions by 2050. However, it is important to note that emission leakage (i.e., increases in emissions outside the EU) could limit global net reductions.

Abstract: Context Given policy objectives for pesticide reduction, functional biodiversity is increasingly important for agricultural production. However, economic land use optimisation models rarely account for the interplay between agricultural production and functional biodiversity, like natural pest control (NPC). Objective We present and discuss an approach to consider feedback effects between NPC and agricultural production in a geodata-based farm economic land use model. Methods The geodata-based land use model PALUD was extended to incorporate interactions between NPC and crop yields. This included linking a generic NPC model, based on semi-natural habitats, with an econometric approach to estimate yield gaps as a function of NPC potential. As a case study, the model was then applied to the German state Brandenburg, using permanent flower strips as example to promote NPC. Here, we analysed the impacts of enhancing NPC potential on food production and gross margins from arable land use. Results and conclusions Our analysis revealed that a higher level of NPC through flower strips improved gross margins. by up to 6.4 % and crop production by up to 1.2 % within a pesticide-free environment in Brandenburg. Despite inherent limitations and uncertainties of the approach, our study provides a pivotal advancement in integrating NPC into economic land use models. Future refinements incorporating more detailed knowledge on context-specific interactions between crops, pests and predators will improve model robustness. Our approach and case study results provide valuable insights for policy-making on tailored sustainable landscape development and serve as a foundation for future modelling efforts. Significance To our knowledge the interaction between NPC and crop yields has not yet been integrated into any geospatially based economic land use model before. Incorparating these interactions is vital for guiding policies towards sustainable agricultural systems. In this respect it is important to develop and discuss further methodological approaches.

Abstract: Governments are increasingly considering fiscal instruments to improve dietary health. This paper quantifies the medium-term impacts on European food markets of a differentiated VAT policy that promotes healthy food consumption while discouraging intake of less nutritious products. Scenarios involve reduced VAT on grains, pulses, and poultry, and increased rates on beef, pork, sugar, and highfat dairy. Our results show a significant decline in domestic consumption of targeted foods. However, part of this reduction is exported to other markets – a phenomenon described as “health leakage,” raising questions about the broader effectiveness of such fiscal interventions.