Cattle farms by stock density : diagnosis and perspectives in the light of the CAP reforms

Abstract

An analysis of French cattle farms according to their stock densities is afforded by the sample of the Farm Accounting Data Network (FADN), which describes 4,200 cattle farms, i.e. an extrapolated population numbering 310,600 production units. Using an appropriate typology, the RICA takes into account the diversity of the technical systems in use and recognises four levels of stock density : under 1, from 1 to 1.5, from 1.5 to 2 and over 2 herbivore GCU per hectare of SFP. For identical technical systems, the extensive farms have greater useful agricultural and forage surface areas than the intensive farms. In contrast, they have smaller herds and so produce on average lower gross outputs and appreciably lower incomes. Though their cost effectiveness is lower, they manage to sustain a financial situation that is fairly similar to the more intensive farms. This is mainly due to lower taxation. The study shows that 75,500 production units, i.e. one cattle farm in four, are eligible for the grass subsidy provided for in the plan accompanying the reform. This aid concerns three million hectares, i.e. more than one third of all France’s grassland. This measure is especially beneficial to farms using the "Naisseur" and "Lait-Spécialisé-Herbe" systems, two thirds of which are located in difficult agricultural areas and which are on average low carners. Over three quarters of cattle and suckler farms are under the 1.4 density threshold, which determines entitlement to community subsidies for extensification. The CAP reform helps to restrict intensification by prompting farmers to remain under this threshold. Yet it does not encourage any real extensification since only 10 to 15 % of all cattle farms have any incentive to extensify to obtain extra direct aid. Simulation of the effects of the CAP reform were carried out using the PECARI programme of the Assessment and Planning Office of the Ministry of Agriculture. These simulations were conducted at constant structure and productivity up to 1996. Overall they predict an average increase in gross farming excess of 7 % over all cattle farms. For any given technical system, the reform favours on average extensive farms specialised in cattle, of small economic size and located in difficult areas. Though the CAP reform affords a slight rebalacing in so far as it favours farms with low inital incomes, income differences subsist. For suckling herds, and especially those where the level of beef specialisation is high, the results of the simulation depended strongly on market price trends resulting from intervention price reduction. The average amount of direct public transfers per cattle farm was 89 kFF (including 42 % direct crop aids), which represents 44 % of the cash flow and 18 % of the gross product. Direct livestock aids per herbivore GCU decrease as stock density increases, but per hectare of SFP, these aids increase as the farms are more intensive.