Flattening CAP payments will not halt the shift towards bigger farm sizes and consolidated agricultural production across Europe, a leading expert on EU agricultural policy has claimed.

Professor Alan Matthews of Trinity College said the reasons for farm consolidation were multi-faceted and that it was not possible “to freeze existing structures in place”.

Addressing the recent Oxford Farming Conference on the future of the family farm, Prof Matthews said the primary driver of consolidation was “the need to provide a comparable income to that earned in the non-farming sector”.

Mandatory convergence

He said the mandatory convergence of EU direct payments, which comes into force for the upcoming CAP programme, would not stop the slide towards bigger farm units across Europe.

“This might result in a once-off blip in the consolidation trend, but to stabilise the numbers of those commercial farms producing food for profit would require continually increasing support to smaller farms year on year,” Prof Matthews maintained.

“There is no evidence that such a policy would be politically sustainable,” he added.

Prof Matthews said he was not suggesting that structural change in farming should be left entirely to the market or that future consolidation trends would inevitably mirror those of the past.

There will continue to be a diverse farm structure with farms of different sizes

In fact, Prof Matthews predicated that parallel with consolidation in the commercial farm sector, smaller holdings will remain in demand for a variety of reasons. These may be used for new entrants, hobby farming, retirement or as tax shelters.

He pointed out that the viability of small family farms can be improved by off-farm incomes and by approaches such as adding value through specialisation or targeting premium markets.

“There will continue to be a diverse farm structure with farms of different sizes,” Prof Matthews maintained.

However, he cautioned that any policy aimed at protecting smaller farm holdings or that sought to deliver “desired rural outcomes” should start from an understanding of what “drives structural change”.

Structural change in farming is a “dynamic process”, Prof Matthews explained.