Food Producers

Europe will lose out on world farm produce markets unless it embraces further deregulation, experts from the and the US warned in 1997.

Professor Abner Womack, a leading US agricultural economist, told the annual Oxford Farming Conference that last year's US farm bill meant "the US farming sector is poised like never before to respond directly to market price signals."

He added: "The US sector will be an aggressive player in world markets. It will strike quickly if favourable conditions signal the need for expanded production."

By contrast, if the pursued its policies of agricultural support and prices moved back to "normal ranges", EU farmers "will not be able to share in the growth of world markets".

The stark choices facing European farmers were underlined by Mr Dirk Ahner, head of policy in the 's agriculture directorate. He warned that arable farmers would be forced to take as much as a quarter of their land out of production by 2005, compared with just 5 per cent this year, if current policies continued.

The next round of global trade talks could lead to significant cuts in border protection, depressing internal EU prices, and to further reductions in subsidised exports, leading to painful cuts in output. Without further farm reforms, dairy production would have to fall by 4 to 6 per cent, he said.

"In all cases, our share in world trade would diminish markedly," Mr Ahner said. "Is this the way we want to go?"

Mr Ahner said some agricultural support should be handled at national or regional levels as it became decoupled from production and more closely linked to the environment or rural development. This is opposed by farmers in countries such as the UK, who fear public spending constraint would put them at a disadvantage