Agricultural market regulations are central instruments of European agricultural policy that control the market process of individual agricultural markets. Agricultural market regulations set the standards for price formation and market equalization for agricultural products in order to stabilize agricultural income. Therefore, the aim of the individual agricultural market organization is to separate the EU internal market from the world market with its sometimes very low prices.
Within the EU, the prices for agricultural products are kept artificially high in order to protect domestic producers from competitors from non-EU countries. This also results in the sometimes much lower producer and consumer prices on the world market. The various agricultural market regimes have different control instruments, including levies, export premiums and import quotas.
Levies are taxes that are levied on the import of agricultural products into the EU. This raises the price of the goods from the low world market level to the price level of the EU internal market. Export subsidies are paid to the exporter for the export of agricultural products from the EU so that the more expensive goods from the EU are competitive on the world market.
The amount of the export subsidy corresponds roughly to the difference between the world market price and the domestic price in the EU. The individual agricultural market regulations intervene in different ways in the market process of the respective agricultural markets. The sugar market regulation or milk market regulation, for example, provides for state measures through volume regulation in production. In contrast, there are the fruit market regulations or the vegetable market regulations, which offer less producer protection. The first agricultural market regulations were adopted as early as 1962.