One of the objectives of the European Common Agricultural Policy is food security, which is defined by the Food and Agricultural Organization (FAO) as follows:

“Food security exists when all people, at all times, have access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life.”

This is of course a basic objective of economic policy for any government, and an objective around which there is broad consensus. The main concern is about the strategy by which food security should be attained.

One option is to diversify sources of supply of agricultural commodities. This implies free trade, and does not argue that domestic production has to be given preference over imports. The goal is to diversify the sources of supply, as in the management of a financial portfolio, so that the diversification of assets decreases the risk associated with the overall portfolio while expected global yield remains constant. This option has another advantage: it is less costly.

The second option is self-sufficiency. It is based on the (right/wrong?) assumption that domestic suppliers are more reliable than foreign ones. It means that in time of war or food crisis the access of the population to food is in no way dependent on foreign suppliers. While as far as war is concerned the case is specious (rationalising a policy through an implausible event), the second case recently gained ground with the rush by a large number of countries around the world to adopt export taxes as a result of the surge in food prices. The WTO should strongly condemn these policies and authorise retaliation.

Even if European agriculture is close to self-sufficiency for numerous finished agricultural products, trade plays a major role as far as agricultural inputs are concerned.

Of course the design of a strategy depends heavily on a country’s geographic and natural endowments. A country like Brazil has a greater degree of freedom than a country like Burkina Faso, which is small and suffers from recurring droughts. But even for a large region with good weather conditions like Europe, self sufficiency is really a lure, a dangerous siren song: in agriculture, as in industrial sectors like motor vehicles and auto parts, processes of production are already highly interdependent. Even if European agriculture is close to self-sufficiency for numerous finished agricultural products, trade plays a major role as far as agricultural inputs are concerned. This is related to the intensive production process which was implemented forty years ago and which now demands the massive utilisation of fertilisers and animal feedstocks. Furthermore, it is well-known that the tariffs on inputs strongly harms the output which incorporates them (following the theory of effective protection by Max Corden). Europe relies upon massive imports of fertilisers and feedstocks (cakes). Imports of nitrogen represent 60 percent of domestic consumption. The ratio is 70 per cent for potassium and 100 per cent for phosphate. Since Russia is a major supplier of these agricultural inputs to Europe, what could happen if it shut down its exports of fertilisers and natural gas? The result would be a major reduction of agricultural production, and the European Union would have to buy agricultural commodities on international markets. The CAP’s declared goal of self sufficiency in food is a misleading option. These issues really have to be considered from a global point of view.