Copa-Cogeca Position Paper. Research and Innovation as the driving force for sustainable, productive and competitive European agriculture

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1 RES(12)5658:4 Copa-Cogeca Position Paper Research and Innovation as the driving force for sustainable, productive and competitive European agriculture European farmers and cooperatives need to fulfil their strategic role in providing for 500 million EU consumers and contribute to securing and stabilising global food supplies. The agriculture sector is also facing major challenges such as climate change, dwindling resources and a need to maintain a diverse and attractive countryside and protect the environment. The EU is in transition from a largely oil-based to a more bio-based economy. This means European agriculture is now a supplier of raw materials for energy and industrial production as well as a provider of safe and high-quality foodstuffs at affordable prices. This new market environment is challenging for the agricultural sector, but also provides new markets and opportunities. Copa-Cogeca believes that only a strong EU agriculture sector which attracts innovation and investment will be able to overcome future challenges, meet society's expectations and contribute to the EU 202o strategy. The European political framework is important in maintaining a competitive, productive and innovative agriculture sector allowing farmers and cooperatives to face these challenges. The design of and interaction between the legislative proposals for the future Common Agriculture Policy (CAP), Rural Development Policy and Horizon 2020 for the period will be of great importance in developing the EU agriculture sector for the future. Further collaboration between the research sector and farmers organisations and cooperatives is crucial if the EU agriculture sector is to find a compromise between the reality of modern farming and society s expectations. This would enable farmers to remain economically viable whilst integrating aspects such as climate change, animal wellbeing, quality and environmental requirements into their day-to-day work. Therefore Copa-Cogeca calls for: Increased links between research policy and the CAP as well as the Cohesion policy, Applied research and innovation to reverse the ongoing slowdown in productivity growth Simplified procedures for businesses taking part in research projects More targeted research focussing on practical and cost-effective solutions in view of a more resource-efficient and sustainable agricultural sector, Well-organised public support for agricultural research at EU level and coordination between national programmes, Measures to promote and implement innovative solutions at farm level, including adequate incentives, cross-border exchanges and the development of an EU onfarm demonstration network, Increased advice and training in view of a modern agriculture which is increasingly supported by ICT and automation Fostering of knowledge exchange between science and practice, such as through the agricultural European Innovation Partnership. European agriculture can only fulfil society s expectations if it remains competitive and profitable. Copa-Cogeca has therefore decided to increase its active participation in the discussions on research and innovation in agriculture in order to support the development and Copa - Cogeca European Farmers European Agri-Cooperatives 61, Rue de Trèves B Bruxelles EU Transparency Register Number Copa Cogeca

2 dissemination of practical solutions. Copa-Cogeca and its members will also contribute to identifying research topics and questions which are relevant on an agronomic and political level. These are a prerequisite to creating a knowledge-based political framework. The driving force for research and innovation in the European agriculture sector EU agriculture has to find answers to a great number of challenges to make the best possible use of the potential of European agriculture. While each challenge by itself requires effort from farmers and cooperatives, their interaction and apparent - in some cases existing - conflicts make them even more demanding. Agriculture is faced with growing global demand for food, feed and bio-based products coupled with the threats posed to basic production systems by climate change and a constantly changing EU production environment. European agriculture is characterised by extremely diverse agri-climatic conditions, making across-the-board innovation difficult. Increasingly unpredictable weather conditions also mean the standardisation of production processes is limited. At economic level, the primary production share of the value chain has declined as global trade has increased, and this looks likely to continue. Investment cycles in agriculture are relatively long as capital is generally tied up in land, buildings and machinery, often making access to necessary funding for on-farm innovation difficult. Stringent EU regulations in many areas result in comparatively high production costs, and with a constantly evolving legislative context for agriculture, necessary investments need to be made well in advance. Innovative solutions which enable cost-effective compliance with changes to legislation or the requirements of the market are therefore particularly important. Far reaching changes are also taking place within the profession itself. One third of farmers in the EU-27 are over 65 years of age (Eurostat 2007) and at the same time the number of farm successors continues to fall. This will mean that farms will on average become bigger and further specialisation (fewer products or sectors) is to be expected. Agri-cooperatives can play a vital role here, acting to coordinate and strengthen their members' position on the market. Innovations at farm level as well as throughout the value chain, whether it be new technology, new practices, services, products and procedures or a new field of application, are key and it is essential to facilitate market access and uptake. Fit for the future a vision of a successful future for EU agriculture Innovation is the driver for future success in business, whether it be through new technology, improvements to the organisation and management of production processes, or new business models. It is vital to strengthen innovation in the agriculture sector, because, as a pioneer in the business world said, "The best way to forecast the future is to invent it". The sustainable and resource efficient EU agriculture sector of the future will be well placed to make a significant contribution to the green economy and wider economic growth. Through innovative solutions based on practical research outcomes, farmers and agri-cooperatives will be able to improve their productivity, profitability and competitiveness and integrate environmental protection in production processes. With the support of research and innovation, agriculture will be able to tackle the challenges of climate change and increase or at least maintain production levels. In the future, we believe farmers will have access to a range of cost-effective modern techniques, tailored to a variety of production conditions and sectors. New technologies, including biotechnology, will contribute to identifying appropriate plants and animals and to achieving progress in breeding. These will enable the efficient use of natural resources, increased carbon storage and reduced greenhouse gas emissions. 2 7

3 In the future, producer organisations and cooperative approaches along the food chain will give agricultural producers a stronger market position. This will allow them to counter the disadvantages of the relatively small scale of European agriculture, to take advantage of the benefits offered by its great diversity, but also to confront significant pressure on prices. Agriculture in the EU will benefit from better knowledge exchange through neutral farm advice, applied research, access to on farm-demonstration and experiment sites and projects supported by IT. Political tools and EU funding to support agricultural research and innovation To strengthen knowledge exchange and improve the uptake of innovative solutions at farm level, a coherent approach is vital. Farm focussed, practically driven research should be coupled with greater incentives, the significant involvement of farmers organisations and a political and societal acceptance of new technologies and innovative solutions. With the right political tools, sufficient and targeted EU funding, it is possible for agriculture to play a pivotal role in green growth. Copa-Cogeca believes that the Commission's proposal for "Horizon 2020", the future Framework Programme for Research and Innovation, the communications on resource efficiency and on the bio-economy and several aspects of the proposals for the future CAP represent a step in the right direction. The future role of EU research policy Currently agricultural research in Europe is highly fragmented. There is a growing focus on basic research without the identification of possible real on farm applications, and there has recently been a reduction in public support in some member states. Copa-Cogeca welcomes the planned increase in future EU support for agricultural research. The Horizon 2020 funds should be used to benefit the agriculture sector through a focus on improving business involvement and emphasising the dissemination of practical research outcomes. Horizon 2020 should be used to promote innovation and to find practical solutions with market value, to incentivise the integration of solutions on farm. It is particularly encouraging that food security and food safety are among the key issues in Horizon 2020, a much needed research area in view of the need for sustainable intensification. Given that food security is a challenge on a number of different levels, research must address social, economic and environmental aspects, as well as the interaction between them. Horizon 2020 should contribute to supporting Europe's agri-food industry (representing 9 % of total EU employment) through research funding in the context of industrial leadership as well as societal challenges. This should consider the entire innovation chain, from primary production through to product marketing. The food industry has an annual turnover of 917 billion, making it the second largest processing industry in the EU-27 and, in conjunction with agriculture, highly significant for both the wider economy and livelihoods in rural areas. Low profitability is a barrier to research investment in industry, and as such there is a particular need for well-organised public support for research and innovation at EU level. This also applies to environmental, climate and animal welfare protection measures. In order to allow the establishment of new production technology in the agri-food sector, activities within advanced manufacturing and processing are also necessary. 3 7

4 Research should be end user-driven and focused on finding solutions to real problems. Information flows in both directions should be expanded to implement research findings on the ground and to allow practical research needs to be taken into account. In the future, the task of SCAR (Standing Committee on Agricultural Research) should be to support this process and to contribute to the efficient use of research funding. More weight should be given to the potential applicability of research outcomes in selection procedures, and the simplification of the process for businesses to become involved in research projects. Practically relevant research requires extensive knowledge of the political context and the current agricultural situation. Copa-Cogeca is involved in a range of European Technology Platforms and provides support for these in its role as a "Science-Business-Interface". Copa-Cogeca would like to see further development of the two Joint Programming Initiatives "Agriculture, Food Security and Climate Change" and "A Healthy Diet for a Healthy Life". Copa-Cogeca is looking forward to the EIT call for new KICs in 2014 including a FOOD KIC covering the whole food chain. The agri-food system is increasingly interdependent and these initiatives are of interest to both farmers and food processors. There is a clear need for public-private research partnerships which focus on new technologies and innovative approaches. This can strengthen private research, including in terms of the key role played by agriculture in the bio-economy. Several agricultural representatives have set up private institutes for applied research or cooperate closely with such institutes. Contributions from farmers are a potential source of private financing. Innovation in the future Common Agricultural Policy Copa-Cogeca particularly welcomes the proposals to strengthen research and innovation, training and advisory services under the CAP and the fact that "Fostering knowledge transfer and innovation in agriculture, forestry and rural areas" has been identified as one of the six EU-wide priorities for the Rural Development Policy. Copa-Cogeca strongly welcomes the creation of the European Innovation Partnership (EIP) on "Agricultural Productivity and Sustainability", which aims better to integrate research, innovation and advisory services. Copa-Cogeca would like to express its readiness to take an active role in this EIP. In terms of the agriculture EIP a coherent approach between Horizon 2020 (which will provide the funding for research) and the EAFRD (under which operational groups will be created) is vitally important. The focus should be on ensuring that the results of research find their way down to individual farm level. The draft legislation states that innovation will be a cross-cutting objective for all the priorities (along with environment and climate change mitigation and adaptation). This highlights how important innovative agriculture is considered to be in the future EAFRD, and that innovation is not an objective in itself, rather a way to achieve the overarching goal of smart, sustainable and inclusive growth in rural areas. Copa-Cogeca is aware of the opportunity this presents. In many instances, however, only a combination of measures will bring about the desired boost to innovation. This not only goes for the absolutely necessary link between investment support and knowledge transfer, but also for environmental measures. At the same time, Copa-Cogeca note there is a need for an additional measure to promote green growth. This is the only way to successfully establish new resourceefficient and environmentally friendly practices at farm level in a timely manner to develop sustainable and multifunctional European agriculture. 4 7

5 The role of the Agricultural European Innovation Partnership (EIP) One challenge is to shape the European Innovation Partnership "Agricultural Productivity and Sustainability", the new network facility, to forge links between research and practical use, as well as generally to encourage innovation. Copa-Cogeca is keen to rise to this challenge and hopes to be represented in the high-level steering board and also to have a say in developing the strategic implementation plan. Within the new EIP, farmers and their organisations and co-operatives must be the driving force of projects. Copa-Cogeca supports the approach to the EIP giving special attention to soil and its vital significance for agricultural productivity due to its significant role in storing water, nutrients and carbon. The EIP needs to solve the apparent contradiction between improving the efficiency of livestock and crop production on the one hand and ecological sustainability on the other. The proposed rural development measures must therefore be provided with sufficient funding and shaped in such a way that they can contribute to this as well as improving the profitability of agriculture. The EIP itself could be the catalyst, because although it does not provide any financing for local work, its success is reliant on close links with other sources of funding. It will be vital to provide suitable instruments and incentives to farmers. Only with improved knowledge of the role played by production and nature and ways of exchanging and using this knowledge in practice can farmers better gear their behaviour towards production and resource efficiency, maintaining biodiversity as well as climate change mitigation and adaptation. Copa-Cogeca note that the network facility has a particular responsibility at EU level as a working interface. Only if it is successfully shaped in such a way that it is recognised by all three important groups representing research, agriculture and advisory services, and considers not only their interests but also those of individual EU Member States equally, can it truly fulfil its central role. When it comes to building up farmer-driven national EIP networks, it is also crucial to give representatives from agriculture the possibility to adapt to having closer links with research, which is often something entirely new for them. Operational groups have a key role to play when carrying out innovation projects. It is necessary to incorporate existing structures, including informal cooperation agreements, and not to create additional barriers or formal requirements for organisation. Cross-border operational groups should also be supported through the EIP. Copa-Cogeca believes that the guiding principles for their recognition and support ought to be common targets in terms of product or process innovation and distribution and a willingness to cooperate over a specific period of time. Failure must also be accepted (not every innovative idea ends in market success). Only if these groups welcome risk-taking, facilitate access to funding and mobilise private capital will they be able to contribute to strengthening the agricultural innovation process and encouraging farmers to forge new and innovative paths. Furthermore, it is vital to use the opportunity for synergies with the cohesion policy for transnational and interregional cooperation programmes, which would overcome the current problem of rural development programmes having a regional or national focus. Cross-border knowledge transfer can considerably accelerate the adoption of innovative management practices. The EIP should allow for cross-border co-operation and the use of structural funds. Knowledge dissemination and linking research and innovation with practical farming and processing of agricultural product will be vital. In this regard, farmers organisations, cooperatives and advisory services will play an important role. The framework conditions in future programmes must be flexible to support use of the advisory system. Copa-Cogeca is in favour of extending the remit of the Farm Advisory System (FAS) in conjunction with support for advice within the framework of the Rural Development Programme. 5 7

6 The European Innovation Partnership on water Copa-Cogeca is committed to contributing to the work of the water EIP as water plays a strategic role in agriculture. Agriculture is facing greater variation in water supply leading to increasingly frequent and severe droughts and floods. Achieving sustainable agriculture in a changing climate will mean reducing water use in agriculture whilst ensuring water supply. Copa-Cogeca calls for an alignment of activities within the water EIP and the agricultural EIP in order to develop cost-effective irrigation systems and technologies, which are key to further improving water efficiency and facilitating adaptation to decreasing water supply. Fostering innovation capacity for EU agriculture In order to describe how innovation capacity in European agriculture can be fostered and to highlight the preconditions for doing so, a selected number of priority themes are presented below. Increased agricultural productivity and closing the yield gap Maintaining and increasing biological productivity is paramount for feeding a growing population and is also a strategically vital element for guaranteeing energy provision and the EU transition towards a bio-economy. Producing biomass from cultivated or forest products must therefore be appropriately factored in to the priorities and financial resources available for supporting research. These may be directed at the genetic improvement of existing crops, or the development of completely new types of multipurpose crops. This increases biological and landscape diversity, and encourages the diversification of activities in rural areas as well as income sources for farmers. It is therefore important to have complementary public and private financing for crop research. Development of the EU protein supply Low profitability protein crops discourage the industry from investing in research. Over the past few decades, little has been done to improve yields and resistance to diseases. This is why these arable crops have become unappealing for many farmers. In such cases there is a real need to successfully coordinate public support for research at EU level. In the pig and poultry sectors a focus on developing new/improving existing sources of protein could help in optimising inputs and reducing dependence on soya the price of which is often volatile and can undermine profitability. In addition, focusing research on feed, nutrition and addressing genetic improvements in livestock could improve end product quality and reduce methane emissions by maximising outputs and minimising environmental impacts. Making the best use of agricultural equipment Farmers now have a wide range of high-tech farm machinery for soil cultivation, upkeep and harvesting. This equipment is becoming increasingly specialised, however, and its use is limited to specific crops or tasks. This can have an effect on crop rotation decisions at the farm level, and make it difficult to test new crops or varieties. Similarly, the supply of more general affordable, efficient machines for traditional farming is decreasing. This can complicate farming on below average-sized or awkwardly shaped fields and make it hard to take farm-specific environmental characteristics, increasingly valued by society, into account. Copa-Cogeca believes that it is crucial to support innovation in these areas to provide farmers with an appropriate degree of choice. In certain cases, technology from other sectors can be adapted to agricultural needs. In the future, expert practical knowledge should be combined with new technologies and areas of application to develop new equipment. 6 7

7 Future animal production It is essential to support the implementation of sound research outcomes on changing animal feeding practices as well as the introduction of innovative housing solutions to reduce greenhouse gas emissions and to better protect livestock against weather conditions becoming more extreme in the future. There is a considerable need for modern housing technology and livestock management in order to facilitate work, decrease costs, improve product quality and at the same time contribute to better animal health and welfare. Alternatives must be based on scientific knowledge and prove to be successful in practice. The latter could be supported by the EIP. Optimal husbandry conditions are needed to realise an animal's full potential, but society s desires regarding animal welfare must also be evaluated against animal needs and health issues. In order to fulfil their production potential, farmers are reliant on external, high-quality supplies, precisely tailored to their needs, such as new breeds, feeding stuffs and veterinary products. Optimising inputs To be able to satisfy the demand for sustainable intensification it is essential to have better conditions for more efficient use of water, fertilisers and other resources at farm level. A range of national and EU-wide research projects, as well as projects supported by the Structural Fund, are currently analysing ways to improve efficiency in the agriculture sector and many promising solutions have already been developed. It is crucial to begin using these innovative ideas and inexpensive efficiency improvements at farm level as soon as possible, for example by supporting knowledge transfer between farmers from different EU Member States or different production sectors. Future research and innovation funds should help to facilitate this knowledge transfer, and continue the drive for more innovation. Optimising inputs also means more research on more efficient fertilisers adapted to soil conditions and the needs of crops. Further research into the release of nitrogen and other nutrients into the soil and their availability to plants is of paramount importance. With regard to plant protection products and managing disease, the climate variance of agro-systems and the high mobility of pests and pathogens suggest an urgent need for further innovation in order to support the development and dissemination of biological as well as integrated pest management (IPM) solutions. Concluding remarks This paper represents the initial thoughts of Copa-Cogeca with regard to the future role of farmers and cooperatives in shaping research for the agri-food sector. Numerous constraints limit the ability of farmers and cooperatives to take full advantage of the potential that European agriculture offers. Research and innovation in the EU agriculture sector has the potential to enable farmers and agri-cooperatives to rise to the challenge of feeding a growing world population in a sustainable and efficient manner. Agriculture has a recognised fundamental role in the social, environmental and economic prosperity of rural areas. The importance of the European agriculture sector is becoming even more evident in times of financial crises and unstable economic conditions. In order to continue to play a significant role in contributing to green growth and the wider economy, an increased focus on the development of an innovative agricultural sector is paramount, together with continued support. Links between farmers, cooperatives, advisory services and scientists at national and EU level will need to be strengthened to achieve coordination between science and practice and a competitive agricultural sector. The implementation of new technologies and innovative solutions at the farm level provides a significant opportunity for EU farmers. Copa-Cogeca will take an active role in helping farmers to realise these opportunities. 7 7