The European Council on Foreign Relations believes that the next European Parliament will be more right-wing than ever, with anti-European populist parties likely to win nine member states and finish second or third in another nine. By June 2024, lawmakers from outside the three main centrist groupings will occupy over half of the EU parliamentary seats, with a populist right combination having the potential to form a majority. This might result in considerable changes to EU policy, notably on environmental matters.
Recent national elections in Europe have shown signs of a long-term shift from centrist-left to right-wing politics, with voters in Slovakia and the Netherlands electing right-wing candidates last autumn. In the United States, Democratic Party President Joe Biden is more likely to compete against Donald Trump, the Republican Party’s most probable nominee for the 2024 presidential election. Farmer demonstrations have energized conservative politicians on both sides of the Atlantic.
Dr. Joseph Glauber, a senior research scholar at the International Food Policy Research Institute, noted that, although there were some country-specific variations, some elements were consistent across the board. He said that grain and oilseed prices have dropped significantly over the previous 18 months, causing farmers’ cash revenues to fall, raising worries in the United States and Europe. Furthermore, since the conflict with Russia began, nations bordering Ukraine have seen a surge in goods entering their markets, forcing them to compete with Ukrainian grain and other agricultural items for storage.
The war also caused an increase in energy prices and input expenses, which were felt across Europe, but less so in the United States. These increases in input costs reduced margins, and when profit margins fall, farmers search for a variety of reasons to blame, causing widespread dissatisfaction. Furthermore, pressure to address environmental sustainability has resulted in a number of farmer demonstrations, mainly in Northern Europe, particularly the Netherlands, where there is concern that greenhouse rules would have a detrimental effect.
European farmers have been more vociferous in voicing their unhappiness than their American counterparts, albeit this might be due to regional differences. The US Department of Agriculture predicts that farmer income would decline by more than a quarter in 2024 compared to 2023, more than 40% below the record high in 2022 but just under 2% below the 20-year average. The predicted drop-off is mostly due to decreased cash revenues, but it also includes greater production expenditures and lower direct government payments, notably lower supplementary and ad hoc disaster relief.
US farmer earnings remain quite solid, with predictions indicating that agricultural revenue in the United States would fall dramatically from the previous year. However, farmers face other challenges, including input costs, environmental laws, and protectionist inclinations when people look at decreased prices and blame imports from other countries.
Farmers have tremendous power over politicians as a result of the worldwide emphasis on food security and increased recognition of agriculture’s involvement in climate change. The issue is whether politicians will reconsider the regulatory side of things, modify present policy courses, or pay farmers. The US government has taken a different approach in terms of giving farmer subsidies to incentivise beneficial environmental behaviors, which has been criticized for being ineffectual, costly, and delivering significantly less effects than a regulated framework.
The current discussion in international organizations is about repurposing domestic assistance and redirecting it away from trade-distorting policies and toward more environmentally friendly ways. In the United States, there is more debate about increasing assistance rather than repurposing it. Many of the farmers who get these subsidies are Republicans, and opinions on this vary by area. Southern US farmers, for the most part, have desired greater support prices, and if it means losing the climate-smart programs, they are OK with it. Other regions of the nation, notably cattle farmers, have profited significantly from climate-smart support.
Dairy producers also confront regional variances of opinion. They go through cost cycles, with high feed expenditures in 2022 because to very high maize and soybean prices. For them, it all comes down to their feed expenses and dairy prices. Many dairy producers consider climate-smart projects as potentially beneficial.
Glauber is concerned about the future of protectionist global politics. What would happen to several markets if protectionist measures were implemented suddenly? European manufacturers would suffer if international leaders suddenly decided to become more protectionist. Donald Trump has pursued a strongly protectionist agenda throughout his first term, even proposing across-the-board taxes on imports and 60% tariffs on China.
