Belgian agriculture centers on large, often vertically integrated operations, especially in the north. In 1994, registered farms totaled 75,542 on an area of about 1.4 million ha. The sector today employs a mere 2.3% of Belgium's working population.

Despite its small contribution to employment, Belgian agriculture and horticulture play important economic roles, underpinning substantial related activities. Animal husbandry and meat and dairy processing make up the largest single component, accounting for nearly 65% of total agriculturally linked output. Horticulture is second at about 20%, with other crops accounting for about 15%.

And although production agriculture contributes only 1.4% to Belgium's gross domestic product, the food processing industry plays a key role in the economy. In 1995, the value-added turnover for food processing businesses accounted for 13% of all Belgian industrial processing activities.

Of the total food processing industry's turnover, 37.5% derived from the dairy, feed and meat processing sectors. Cereal processing accounted for 2.8%, while bakery products and biscuits accounted for 9.8%. Other key sectors include brewery-malting and cocoa, sugar and confectionery production.

Belgian production agriculture varies notably between its two main regions, the Dutch-speaking Flemish area in the north and the French-speaking Walloon area in the south. Agriculture in the Flemish region is very intensive, while farming in the Walloon region is much less so.

The Flemish region accounts for 74% of Belgium's total agricultural production value, 46% of total agricultural area and 66% of all farms. Conversely, Wallonia's production value is 26% of the country's total on 54% of the area with 34% of all farms. These figures illustrate the sharp differences in land use, intensity of farming and agricultural income between the two regions.

The differences initiated a decision this year by the Belgian government to create two regional agricultural ministries, a change scheduled to take effect Jan. 1. The action corresponds to other institutional reforms and constitutional amendments in recent years that have granted the two regions formal recognition and autonomy.

Under the agriculture plan, most federal government agricultural responsibilities will be transferred to the new regional agricultural ministries. A number of agricultural research centers will come under the jurisdiction of either the Flemish or Walloon ministries.

Issues related to food safety, animal health and the quality of animal products will remain with the federal government under the Public Health Ministry. The federal government also will retain authority over Belgium's participation in the E.U. Common Agriculture Policy and income support programs for farmers. Belgium's Foreign Trade Secretary of State will represent the regional entities in the E.U. Agricultural Council, but the regional ministries, through a special bureau within the Belgian permanent E.U. representation, will delegate authority to the secretary for Agricultural Council meetings.

The separation of the federal agricultural ministry into regional agencies has been controversial. Although Belgian farm organizations were consulted by the government and were given an opportunity to comment, they claim that the government did not consider their priorities. And although the farm organizations agree that implementation of E.U. directives should fall under the jurisdiction of the regional entities, many think decision-making authority should remain with the federal ministry to avoid seeing Belgium's national influence diminish in the E.U. Agricultural Council.

Observers expect that regionalization will not have a major impact on international trade relations, but the changes probably will make it more difficult for Belgians to achieve national consensus on farm issues that affect the regions differently.

LIVESTOCK AND FEED. The Belgian livestock and feed industry is the country's largest agricultural sector, and it is still recovering from the serious negative effects of the 1999 dioxin crisis.

The crisis began when dioxin-contaminated fats from a rendering company were delivered to 10 Belgian, one Dutch and one French feed compounding companies. The discovery and the subsequent contamination of some amounts of pork, beef, poultry, eggs and dairy products put the Belgian livestock and products sector in a deep crisis.

The Belgian pork industry strongly depends on export markets, with more than 50% of pork production shipped abroad, primarily to Germany, Japan and South Korea. But in June 1999, exports of Belgian pork, poultry and eggs practically ceased because of buyers' concerns over contamination and overall quality control.

An analysis late in 1999 by the Belgian government indicated that economic losses from the crisis, although sharp, ultimately were less severe than initially feared. The directly affected subsectors of the food industry — meat and poultry production, slaughter and products — suffered a sharp decline in June 1999.

For the Belgian food and processing industry as a whole, the crisis created production losses of an estimated 10% in June 1999, 2.5% in July and August, and 1.5% in September. For the Belgian manufacturing sector as a whole, those losses created a negative effect of 1.2%, 0.3%, 0.3% and 0.2%, respectively.

As a direct consequence of the crisis, the Belgian government established several new programs, including the Federal Agency for Food Safety. The Agency assumed a number of responsibilities previously handled by five different agencies at the Ministries of Public Health and Agriculture.

The Food Safety agency has seven areas of responsibility, including monitoring and control of food products and their raw materials at all stages of the food chain. The agency also must build raw material identification and traceability systems and prevention and communication programs.

Another food safety tool resulting from the dioxin crisis is the Contaminant Surveillance System (CONSUM), which monitors feed samples for contamination. CONSUM already has proved its worth, as the system this year discovered two cases of PCB contamination in animal feed that were quickly contained.

Belgium also this year implemented a tracking system for meat products known as BELTRACE. Although all E.U. member states are required to track beef production, BELTRACE goes a step further by tracking all livestock species. Currently a pilot program, BELTRACE is scheduled to become mandatory in all Belgian slaughterhouses by Jan. 1, 2002.

In addition to government actions, the livestock and feed industry itself is taking measures to assure and promote product quality. In the case of the Flemish pork industry, these measures include adoption of CERTUS, a new brand label to identify high quality, fresh pork. Pork producers in the Walloon region have marketed fresh pork under a quality brand since 1993 and saw their market demand soar during the height of the dioxin situation.

The CERTUS program contracted with SGS, a Swiss-based independent surveillance agency, to set up the quality controls. Only animal feed manufacturers certified for Good Manufacturing Practices (GMP) can produce feed for CERTUS hogs.

Although Belgium may have taken control of feed and meat quality issues, it has yet to find a solution to another problem related to its extensive livestock industry, phosphate emissions from manure. The Belgian livestock industry annually produces 80 million tonnes of phosphates.

According to E.U. regulations, the northern region has an excess production of 36 million tonnes, a level that must be reduced by 2003. So far, the Belgian government has announced several ideas, but it has not developed a solid plan to meet the E.U. nitrate requirements.

The government intends to limit nitrate and phosphate production by limiting these two compounds in animal feed. This measure might make a difference of 10 to 15 million kilograms of phosphate.

The Belgian government also wants to process manure and thus dispose of 50% of all excess phosphate. But manure processing plans have been under discussion for the past 10 years, and to date, no system has proven to be economical or within the required environmental rules and regulations. The Belgian government also counts on a decreasing swine production, but no program to make it attractive to farmers has been proposed.

GRAIN AND PROCESSING. Belgium has a mature, modern and efficient flour milling industry. Between 1980 and 1992, the number of flour mills in Belgium decreased by nearly one third, from 140 facilities to 98. The trend was most noticeable among smaller mills, which found it difficult to compete in the very capital-intensive grain processing subsector.

Because of the insufficient quality and quantity of domestic bread wheat, Belgium's mills are largely dependent on wheat imports. Consequently, the major mills are located along waterways, which offer easy connection with Gent and Antwerp, Belgium's main ports of entry.

Belgium's total flour output in the past decade has increased only slightly, peaking at 1.343 million tonnes of flour in 1997 and holding that level in 1998, according to the International Grains Council.

In 1955, major Belgian flour millers formed United Belgian Mills (UBEMI) for the express purpose of developing export flour markets. Current annual flour exports by the confederation total about 500,000 tonnes, ranking UBEMI as one of the E.U.'s largest flour exporting entities. n

Melissa Cordonier Alexander, formerly an editor of World Grain, is now a consultant providing information research services for agriculture.