The effects of CAP greening on specialised arable farms in Italy
New Medit, vol 14, n.2, (June 2015), pp. 22-31
Jel classification: Q12, Q18
In the CAP 2014-2020 a component of the total amount of direct payments is linked to the remuneration for specific environmental actions required to farmers. This paper analyses the effects of the greening measures on farm income in Italy ,focusing on two specialised farming systems which will be largely affected by the introduction of green payments: the maize production system, mainly concerning Northern regions, and the durum wheat production system, prevailing in Central and Southern regions. The effects of greening requirements were determined, based on the Italian FADN data, by looking at the change of total Gross Margin deriving from the introduction of crop diversification and Ecological Focus Areas requirements. These changes were assessed for 16 “representative farms” where these specialised systems prevail. The paper shows that greening requirement will probably have some significant negative effects, in terms of gross margin, especially for farms specialised in maize production and located in the plains. Data also indicates that for farms specialised in maize production, the green payments do not generally compensate the reduction of farm gross margin, while for farms specialised in durum wheat, the green payments would cover the reduction of farm gross margin caused by the introduction of the new environmental obligations.
CAP reform, direct payments, CAP greening, Italian farming systems, FADN