The Role of area-yield crop insurance program face to the Mid-term Review of Common Agricultural Policy



The farm 9, that has good soils, does not produce durum wheat and it starts to produce
barley. With respect to the beef cattle farms, these farms maintain the number of cattle
heads, they increase the pasture and forage areas and they substitute durum wheat for
barley. The sheep farms reduce their herds drastically and they substitute durum wheat
for barley and oats. As the decoupling of income payments is not related to farm
production, the variability of the results decreases. The level of subsidies decreases due to
the new values of the specific subsidy to the durum wheat and the modulation.

Table 4.2 - Model Results with the new CAP- Partial Decoupling of Income Payments

Description

Farn

Farm

Farm

Farm

Farm

Farm

Farm

Farm

Farm

1

2

3

4

5____

6

7

8

9

Crop Activities

Barley

43.9

14.1

27.9

53.8

36.1

67.5

Oats

136.8

27.9

Sunflower

105.3

2.6

67.5

Oats/Vicia

64.6

64.5

31.3

62.1

39.6

142.3

Pastures

824.2

442.0

133.0

286.2

193.0

786.0

Setaside_________

69.1

107.0

______1.6

193.8

313.6

200.0

260.0

27.7

415.0

Total area_______

1200.0

690.0

180.0

570.0

600.0

200.0

260.0

1020.0

550.0

Livestock Activities

Beef cattle

400

150

90

450

Sheep_________

1006

564

Farm Income

State of Nature 1

21 944

34 916

5 576

17 164

7 472

9 926

17 319

24 857

2 534

State of Nature 2

56 484

40 806

13 347

21 805

10 819

9 926

17 319

58 986

9 224

State of Nature 3

78 991

48 962

16 437

27 481

17 172

9 926

17 319

74 399

17 986

State of Nature 4

94 223

54 808

18 820

30 725

22 088

9 926

17 319

85 680

26 199

State of Nature 5

103 949

56 754

19 903

32 139

23 186

9 926

17 319

90 030

32 337

Subsidies

Dec. payment

160 523

76 638

26 826

62 519

87 338

33 894

45 983

114 389

101 466

Prod. Subsidies

74 582

35 300

16 781

11 976

6 713

______0

______0

83 904

______0

Notes: Crop activities in hectares, livestock activities in animal units and monetary values in Euros.
Source: Model Results.

Among various alternatives under the mid-term review of the Common Agricultural
Policy, the Portuguese government decided to assign to farm production 50% of sheep
premium, 100% of veal premium, 100% of suckler cow premium and 40% of slaughter

19



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