The European Commission insists that there is no connection between EU agricultural subsidies and rising food prices, and stresses that the CAP is much less trade-distorting than the American policy.
Meanwhile, EU member states' views vary greatly on the matter, suggesting that a difficult debate lies ahead on the size and precise role of direct EU support for farmers in the post-2013 era. While countries like the UK and Denmark are in favour of reducing the overall CAP budget drastically and allocating more funding to rural development and the provision of public goods, others want to see the retention of a strong CAP in the current context of declining farming income and rising food prices, including France and Greece.
UK Finance Minister Alistair Darling recently called for an end to "all elements of the CAP that are designed to keep EU agriculture prices above world market levels," saying it was "unacceptable that at a time of significant food price inflation, the EU continues to apply very high import tariffs to many agricultural commodities".
But former French Agriculture Minister Michel Barnier argues that CAP subsidies are not to blame for the hike in food prices and that the EU example should even serve as a model for regional versions of the CAP in Africa and Latin America. Barnier argues that such schemes would help the developing world to achieve self-sufficiency and combat soaring food prices (EURACTIV 29/04/09).
Barnier believes the food price crisis highlighted the persistent need for the CAP, describing it as the "cornerstone of the continent's food security".
France rejects the idea of reviving the Doha talks to liberalise trade in agricultural products, and argues that Europe must instead step up its efforts to become self-sufficient in food.
Momagri, a French think-tank which promotes a new global vision for agriculture, argues that "heightened and unregulated liberalisation of agricultural trade would lead to renewed increases in food prices and even greater price volatility". It calls for a two-step approach to liberalising trade in agricultural products, whereby trade would be fully freed up within pre-defined sub-regions: North America/Mexico, South America, the EU, China, India, Africa, Russia/Ukraine/Kazakhstan, North Africa/Near and Middle East, the rest of Asia and the rest of the world.
The UN Food and Agriculture Organisation (FAO) notes that while Organisation for Economic Co-operation and Development (OECD) countries have traditionally protected their agriculture sectors heavily with subsidies and trade policies, "these support and protection policies affected above all the trade performance (changed market shares) as well as consumers (paying higher prices) and the taxpayers (paying the subsidies) of the OECD countries themselves".
The FAO therefore argues that agricultural trade liberalisation would result in high-income countries gaining the "lion's share of gains in welfare" together with some developing-country exporters of competing products. Meanwhile, some developing countries which enjoy preferential access to protected markets and those that have few agricultural exports but import much of their food - like the ACP countries, which enjoy preferential agreements with the EU - could be harmed, it says.
The European Parliament argues that "although the funding of the CAP has contributed over the years to securing low consumer prices, it is noticeable that consumer prices remain high or are not falling despite the fall in prices in the agricultural sector".
The Parliament believes that within the framework of the CAP, market-management measures are called for to provide stability for the agricultural sector and the agri-food market, and to maintain sustainable EU agricultural production at reasonable prices.
MEPs also consider "an imbalance in the food chain" to be among the causes of prices differences at source and at the final destination, and regret that the EU lacks adequate measures "to encourage producers' organisations, through cooperatives or other organisations, to promote supply concentration". Such concentration, they believe, would result in "a better organisation of the market and increased negotiating strength for producers vis-à-vis the other links in the food chain".
EuroCommerce, which represents the European retail, wholesale and international trade sectors, states that "commerce wholly rejects any implication that responsibility for recent price increases should lie at its door or that it is failing to pass price decreases on to consumers".
EuroCommerce Secretary-General Xavier Durieu said "the price transmission issue is highly complex and largely depends on the degree of competition throughout the supply chain".
Farmers and agri-cooperatives across Europe, represented by Copa-Cogeca, deplore that producer prices for many agricultural products have fallen substantially while the cost of production has risen sharply. They also stress that farmers are not to blame for consumer price increases.
The lobby notes that farmers "receive a declining share of the price consumers pay for food in the shops" and that the share is "often not sufficient to cover their costs, never mind give them a fair income".
"Farmers and their cooperatives are now up against the huge buying power of a handful of supermarkets," Copa-Cogeca states. The lobby group argues that the EU's CAP helps provide farmers with payments to cover additional costs and helps them to become more competitive by helping them to modernise their farms.
The CAP can also can provide tools for risk management regarding price volatility and "ensure market forces do not spin out of control", it said.
A study by the Humboldt University of Berlin, co-sponsored by the European Crop Protection Association (ECPA), a pesticides industry lobby, argues that Europe needs to increase agricultural productivity to respond to rising food prices. It notes that global food supply cannot keep pace with growing demand, as globally available agricultural land is limited in scale and the most productive land is already being farmed.
"Where land reserves exist, they often should not be used for farming because of environmental reasons. Consequently, to meet the needs of the rapidly growing world population, the necessary production growth will have to come to a very large extent from a growth in productivity of the land already being farmed today," the study concludes.
It further argues that the EU "will be less affected by climate change" than other world regions and that Europe will become a "more secure production location in comparison to other world regions". Therefore, it urges the Union to take responsibility and "significantly contribute to world food security, capitalise on its production potential and employ strategies which increase overall agricultural productivity on the available agricultural land".
"We cannot expect to increase agricultural productivity without having a full range of modern farming tools available: from new breeding techniques to crop protection products," argues Claudia Michel, senior manager for agriculture, environment and food policy at the European Crop Protection Association (ECPA). "These tools increase productivity, secure yields, reduce crop losses and therefore help provide a sufficient and sustainable supply of fresh fruits and vegetables to farmers throughout the world," she added.
According to Syngenta, a Swiss plant science and breeding company, increased food production and opening up markets, both domestically and abroad, can help address high food prices in the long run.
In Syngenta's eyes, such action would be "preferable to food aid," although direct aid can be relevant in the short run and where natural and governance disasters interfere with efforts to intensify production and supply, the company stated.
Mark Titterington, European public affairs director at Syngenta, said "it is absolutely necessary to grow high-quality affordable food with less environmental impact," which he says is possible thanks to technology and knowledge.
However, in order to achieve this goal, farmers need a system of incentives that the market does not provide, he said. Such incentives could be provided by making public sector payments to farmers for services that are not market-priced, such as biodiversity and landscape management.
Titterington believes that the upcoming CAP reform presents an opportunity to say that "farmers need to grow more from less". If they are to do this, they need access to technology and know-how, he argues. Increased EU investment in agricultural research is also needed, as well as a "more joined-up approach from the Commission's department for agriculture and environment".
The International Assessment of Agricultural Science and Technology for Development (IAASTD), a World Bank initiative, notes in its first global report on the state of agriculture that "an increase and strengthening of Agricultural Knowledge, Science and Technology (AKST) towards agro-ecological sciences will contribute to addressing environmental issues while maintaining and increasing productivity".
This can be done by moving towards a "more resource-efficient and site-specific agriculture," and facilitated by technological options such as new genotypes of crops, livestock, fish and trees and advances in plant, livestock and fish breeding, biotechnology, remote sensing, agroecology, agroforestry, integrated pest and nutrient management as well as information and communication technologies (ICTs), the report said.
Environmental NGO WWF believes many complex structural causes contribute to the price crisis, "but many of these revolve around the question of how we use and treat the planet we live in". According to WWF, the way forward involves producing more rice with less water, using protected areas to secure food, reducing hunger without increasing thirst, and promoting sustainable fishing.
Greenpeace argues that food shortages, unaffordable food prices and hunger are primarily a result of industrial farming, bad harvests related to climate change, unjust terms of trade and the rush for biofuels.
ActionAid, an international anti-poverty agency, is urging the UN to look at how speculation on agricultural commodities can be curbed. It is expecting concrete measures to stabilise prices or control speculation - such as increasing food buffer stocks, limiting trading positions, raising margin deposit requirements, or taxing speculative transactions.
Magdalena Kropiwnicka, food policy analyst at ActionAid, said "stable agricultural markets, where prices reflect real supply and demand conditions, are essential if agricultural systems in developing countries are to be rebuilt, and if developing countries are to enter regional or global markets for agricultural commodities on fair terms".