Substantial structural change is taking place in EU agriculture. Average farm size is increasing and labour is continuing to move out of the sector. Slow growth in food demand and the effects of technological change on supply are likely to exert downward pressure on real agricultural prices. Within this context, policies at the EU and national levels will have mixed effects on economic adaptation and structural change. There is considerable uncertainty about the long-run viability of the so-called European model of agriculture, particularly given the intensification of pressures for change through economic globalisation.