Over the past few years, price volatility has become a central concern for European farmers and consumers due to changes in demand, supply and structural characteristics of the market. This has resulted in an increase in costs and debt by farmers, with 2.4 millions EU farms disappeared between 2005 and 2010 and making it more difficult for farmers to establish and grow their business. In turn, consumers have more limited access to basic and quality goods due to high prices.

The Common Agricultural Policy (CAP) addresses this problem mainly through direct payments as compensation to farmers, rather than tackling price volatility through market intervention. Risk management tools are included in Pillar II, but critiques point out that they represent only 0.4% of the total CAP budget.