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Farm-based modelling of the EU sugar reform: impact on Belgian sugar beet suppliers

  • Jeroen Buysse
  • Bruno Fernagut
  • Olivier Harmignie
  • Bruno Henry de Frahan
  • Ludwig Lauwers
  • Philippe Polomé
  • Guido Van Huylenbroeck
  • Jef Van Meensel

A mathematical programming model, calibrated on individual farm data, is used to analyse the reform of the common market organisation (CMO) in the sugar sector of the European Union. The model includes a precautionary farm supply function for out-of-quota sugar beet that is estimated as part of a simultaneous system of first-order conditions. Simulation results from a sample of Belgian sugar beet farms show that the sugar CMO reform induces different supply and income effects across farms depending on their share of out-of-quota sugar beet relative to their total beet supply and their quota rent. A further cut in the minimum price of sugar beet initiates structural change in the farm sector. Copyright 2007, Oxford University Press.

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Article provided by Foundation for the European Review of Agricultural Economics in its journal European Review of Agricultural Economics.

Volume (Year): 34 (2007)
Issue (Month): 1 (March)
Pages: 21-52

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Handle: RePEc:oup:erevae:v:34:y:2007:i:1:p:21-52
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