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New Year greetings to the farming community

Published on January 24, 2011
Speech by Nicolas Sarkozy, President of the Republic (excerpts)

Truchtersheim, January 18, 2011

(…)

FARMERS’ INCOMES

Agriculture wouldn’t remain prosperous for long in a marginalized countryside. The farming community is a complete entity and the State must ensure its rural fabric isn’t torn apart.

How will we do this? In 2011 we’re going to continue structural action to increase farmers’ incomes. My conviction is the same; I think today people share it. I defended it tooth and nail at a time when we didn’t all defend it – particularly in my presidential campaign. I think – I’m convinced – that farmers must have profitable prices to live off. The first demand you must make is on prices. You’re entrepreneurs, people with know-how, and you must have prices which cover your cost price and enable you to invest. The key to your revenue is the prices issue. It really is an absolute conviction on my part, and if we start on that basis, the direction for the government, cher Bruno Le Maire, is simple: to strengthen the competitiveness of the agri-food industry.

Competitiveness plus price equals revenue. That’s the key. Every time you’ve been promised subsidies, you’ve received a bundle of extra paperwork, until such time as they explain to you – these things go completely together – that there’s no longer a budget and the subsidies must therefore be reduced. That’s how things are.

In parallel, there’s a whole international side [to our efforts] to protect our agriculture.

AGRICULTURAL MARKETS/SPECULATION

The French G20 Presidency will be a chance to work towards reducing the instability of the agricultural markets. I want to say a word about that: the market isn’t a four-letter word for us. We accept the market, of course, but we want a regulated market. Both. And I won’t accept people stereotyping France’s position as refusing the market. We want a real market, not speculation – because the people who challenge the market are the speculators. The people who challenge the market are the people who make it so unstable, so erratic. We believe in a market where supply and demand are balanced. Of course, at European level, we must have an ambitious budget for the Common Agricultural Policy post-2013. (…)

And I’m going to say something I believe is quite powerful: French agriculture hasn’t got rid of its former masters from two centuries ago only to let globalization provide it with new ones. I want you to think about that. (…)

FOOD SHORTAGES

We must protect the interests of our agriculture in international negotiations. What do we do in the face of the strikingly volatile price of cereals, sugar and cocoa, the effects of which are devastating for our agriculture and global food security? After last summer’s drought in Russia, the floods in Australia and the drought in South America, the available quantities of agricultural commodities have reduced by considerable proportions.

Maize stocks are today at their lowest, which heightens the volatility of agricultural commodities. In 1987 the global stock stood at 168 days’ consumption. Just think: today it’s gone down to 57 days’ consumption. (…)

When Mr Putin took the decision to ban exports, as did Ukraine, [causing an impact] on the Maghreb countries, there was no transparency about the state of the stocks. Shouldn’t the world put itself in a position where it can find out the state of the stocks? Because you understand, when there’s no transparency about the state of the stocks, who profits from it? The speculators, creating a panic effect.

I want harmonized regulation of the agricultural commodities markets.

There, too, is it normal for people to be able to intervene on an agricultural commodities market, buy considerable quantities virtually and sell them back, pocketing the profit even before they’ve paid for them? Is that normal? I say it isn’t normal; it contributes to completely destabilizing the system. Either you’re there to buy physical quantities of commodities, in which case you pay for them and take delivery, or you’re there to gamble, and in that case you must pay in a different way. Shortages drive prices up; it’s supply and demand. But speculation takes advantages of shortages, causing prices to explode, and afterwards not a single breeder can keep balance on his farm. (…)./.

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