According to the 'Short-term Outlook for EU agricultural markets in 2021' report recently produced by the European Commission, the outlook for European agricultural markets in 2021 is favorable. The document highlights the resilience shown by the EU agricultural sector during the COVID-19 crisis, a period in which higher retail sales and domestic consumption partially offset the losses in foodservice, and supports its optimism on the dynamism of world demand and the expected reopening of the Horeca once the vaccination campaign is sufficiently advanced.
In addition, the document highlights that the uncertainties related to trade relations with the United States have decreased significantly after both parties reached an agreement at the beginning of March to temporarily suspend the tariffs related to the aeronautical conflict between the EU and the US.
The report also states that the agreement reached at the end of 2020 with the United Kingdom, which guarantees trade free of tariffs/quotas, was favorable. However, trade with the UK still has its friction. Operators on both sides of the Canal will need time to adapt and provide the necessary conditions, for example regarding infrastructure and border controls, to achieve optimal exchanges.
The report also presents a general outlook and an outlook by sectors based on the analysis of the latest trends in the agri-food markets. It indicates that the rise in prices of herbaceous crop products is helping farmers and ranchers to offset the rising cost of fertilizers and other inputs.
It also states that the consumption of fresh oranges and apples, which increased during the pandemic, is expected to remain high.