Minister Köstinger, MEP Müller, elected representatives, ladies and gentlemen,
I am grateful for this very useful opportunity to discuss the state of play in relation to plant proteins in the EU.
I would like to formally thank Minister Köstinger for co-organising this conference. Your support and the active engagement of the Austrian Presidency have been central to reaching this point.
I also want to pay tribute to the other stakeholders who played a key role in driving this initiative forward.
Under the guidance of the European Commission services, everyone in this room, and many who are not here today, contributed greatly to the process:
- by replying to the initial survey;
- by participating in the four expert workshops;
- and through their involvement in bilateral meetings with Member States and stakeholder groups.
Our main objective in this process was to stimulate discussion and reflection on how we can develop this important sector.
I believe the report adopted yesterday is an extremely valuable roadmap, which should serve as the key reference point for the future.
Scope of the Protein Deficit
What is at stake is to increase domestic production of protein rich feed. In this respect, plant proteins are crucially important for EU agri-food. As a vital component of animal feed, they represent an important link between arable crops and the livestock sector.
They are also increasingly popular in human food consumption, reflecting changing consumer preferences and tastes.
The current CAP provides several instruments that directly or indirectly support the production of protein crops in the EU, notably Greening, Voluntary Coupled Support and Rural Development Measures.
These measures, together with a positive market environment, have contributed to a positive trend in recent years and to increasing EU production of protein crops.
However, due to a variety of other market and climatic factors, European protein crop production is not sufficient to cover the growing demand.
In the context of increasing global food demand, imports of protein rich feed are likely to continue but I am convinced that the EU-grown protein crops will also find their place on the European market.
The issue of plant protein production in the EU relates not only to supply but also to agronomic and environmental considerations. It is against this background and in the light of the CAP's overall objectives that options to increase domestic production are being explored.
Plant proteins represent a source of potential, both economically and environmentally. The report, that you discussed yesterday, finds growth potential for EU plant proteins above all in premium feed and food sectors, driven by consumer demand.
The market has experienced considerable segmentation, with demand in high-value feed and food sectors growing.
The food market for plant proteins is seeing double-digit growth, driven by demand for meat and dairy alternatives.
To outline ways to fulfil this potential, the Commission has identified five areas of possible action in our report.
Firstly, our legislative proposal for the future CAP can provide a strong and favourable framework for protein crops in the future.
Our plan involves a new delivery model which we believe can transform the contribution of the agri-food sector to the EU's ambitious climate and environment targets.
The proposal foresees that 30% of spending in Pillar II should be dedicated to environmental and climate actions. The ‘eco-schemes’ funded by Pillar I will provide additional options in this area.
The environmental benefits provided by legumes can help achieve the objectives in the national CAP strategic plans; this would be a win-win situation for environment and for supply of protein crops in Europe.
Legumes can fix nitrogen, reducing the use of synthetic fertiliser. Nitrous oxide is almost 300 times more potent as a greenhouse gas than CO2.
With this new ‘delivery model’ Member States will have numerous tools at their disposal. This approach fits well with the development of plant proteins: given the regional differences in terms of climate, soil conditions, farm structure or sector organisation, not to speak about consumer preferences, a one-size-fits-all approach at EU level approach would simply not work.
And of course while it is the Member States that will design their plans, DG AGRI stands ready to provide expertise and technical support for Member States who wish to, for instance:
- Set up producers organisations and sectorial programmes to strengthen supply chains;
- Reward the environmental benefits of legumes through Eco-schemes and other management commitments under rural development programmes;
- And improve knowledge of protein crop production among farmers.
A second crucial field is research and innovation. Under ‘Horizon Europe’ - the most ambitious research and innovation programme ever - €10 billion will be dedicated exclusively to the agri-food sector and protein crops can benefit from this funding, possibly through calls for research and innovation projects specific to proteins.
An important instrument to manage the agri-food section of the EU research budget is the European Innovation Partnership for Sustainable Agriculture (known as "EIP-AGRI"), which will be strengthened and enhanced under the new CAP and Horizon Europe.
This European initiative has been highly successful in bringing innovation to rural areas. It has supported over 700 innovative projects to date – through what we call ‘Operational Groups’.
At the end of 2020, we expect more than 3000 of these groups to be active in deploying innovation solutions all over Europe, including for protein crops.
Third, DG AGRI will work on better market analysis and transparency over the coming years. This market is complex and quantitative analysis is not straightforward at EU level. One useful tool is the Crops Market Observatory, which I created last year and which will intensify its work on protein crops.
DG AGRI will explore the option of developing price reporting for Member States and the agricultural sector. Furthermore, the external "market study on plant proteins", contracted by DG AGRI will be published in January, bringing more insight into the different markets.
Ultimately, this will provide a better understanding of the relevant markets and enable operators to better tailor their production and investments. In the medium term, a more developed and transparent market could even lead to developing European future markets for soya.
Furthermore, I believe that intensified promotion of the benefits of plant protein for nutrition, climate and environment is needed, using the EU promotion policy and the communication tools at our disposal. Consumer preferences are already moving in this direction, and this is a trend we can encourage further.
Last week, I launched the 2019 programme to promote agri-food products at home and abroad, with a budget of €191 million. It includes:
- ‘Programmes on EU quality schemes, organic’;
- And ‘Programmes highlighting specific agricultural production systems’.
The promotion of EU plant proteins fits well within these programmes.
Finally, further knowledge exchange is needed. Many initiatives are already ongoing in the EU, from Member States, regions, interbranch organisation and stakeholder groups.
This is definitely very positive and we don’t need to reinvent the wheel.
Therefore, I think it is important that the Commission actively contributes to the exchange of knowledge and best practice at EU level. We can discuss what the best format would be; but I believe that a European Platform would help transfer knowledge and bring the different actors in the chain closer together.
Additional Market Dimensions
I also want to make it clear that our report focuses on the opportunities for EU-grown plant proteins.
These opportunities are mainly in the more value-added market segments, like food and premium feed, such as non-GM or organic, while the imported soya beans and soya meals are mainly used for commodity feed markets.
The potential for EU-grown protein crops does not influence the perspectives for importing soya beans from the USA, as it targets a different market segment and the EU's overall need for plant protein will continue to grow in the coming years. .
President Trump's trade policies are giving American farmers plenty to worry about at a time when the economics of farming are tough. Driven by this new market situation, EU imports have significantly shifted in favour of US soya beans.
When it comes to soya, EU self-sufficiency amounts to only 5% of our needs, therefore we will continue to import these products. Given the size of our protein deficit, a full substitution of all soya imports by EU soya production is in practice not achievable.
In conclusion, ladies and gentlemen, I want to once again thank you for your contribution to this report and the constructive discussion about its outcome. It is a very strong starting point for further reflection and action.
As I said at the outset, what is at stake is to increase domestic production of protein rich feed.
We will never ensure EU self-sufficiency in proteins, but we can achieve a better balance in relation to supply and demand, and help European plant protein growers to benefit from the dynamic growth of premium market segments, boosting our agri-economy and our environment.
We at the European Commission want to keep in close contact with you, and all the other relevant stakeholders, in relation to how we can best implement the five areas for action we have identified in the report.
I would like to stress that this project to date has been an outstanding example of cooperation and dialogue with different sector representatives and I am convinced that if we continue in the same spirit when designing future action, we will be on the right path. Thank you.