The European Commission has proposed an exceptional measure to allow EU member states to pay a “one-off lump sum” to farmers and agri-food businesses affected by significant increases in input costs.
The measure will be funded by the European Agricultural Fund for Rural Development (EAFRD), which funds Pillar II of the Common Agricultural Policy (CAP).
The measure could be worth up to €15,000 per farmer or €100,000 per rural business.
Making the announcement today (Friday, May 20), the commission noted that such increases in prices, notably for energy, fertiliser and animal feed, are disrupting the agricultural sector and rural communities, leading to liquidity and cash flow problems for farmers and small rural businesses.
The support measure is aimed at addressing the market disturbances, and thus contributing to global food security.
European Commissioner for Agriculture and Rural Development Janusz Wojciechowski commented: “Farmers, with the support of the CAP, continue to relentlessly prove their worth by producing food under difficult circumstances.
“After the Covid-19 pandemic, they are now being heavily hit by the consequences of the Russian invasion of Ukraine. For some, survival is at stake. With this measure, the latest in a series deployed under the CAP, we support them so they can keep producing the food the world needs; care for their land; and provide for their families,” the commissioner added.
The measure will now have to be adopted by the European Council (member state governments) and the European Parliament (MEPs).
Once adopted, the measure will allow member states to decide to use available funds of up to 5% of their EAFRD (Pillar II) budget for the years 2021-2022 for direct income support for farmers and SMEs active in processing, marketing or development of agricultural products.
This represents a potential budget of €1.4 billion in the EU. Member states are required to target this support to beneficiaries who are most affected by the current crisis and who are engaged in the circular economy; nutrient management; efficient use of resources; or environmental and climate friendly production methods.
Selected farmers and SMEs could receive up to €15,000 and €100,000 respectively.
The payments should be made by October 15 next year. To make use of this exceptional possibility, member states will have to submit a modification to their Rural Development Programme to introduce this new measure.
Today’s proposal follows the €500 million support package for EU farmers adopted on March 23 for “safeguarding food security and reinforcing the resilience of food systems”.
For both measures, the commission is encouraging member states to support farmers engaged in sustainable practices.
The commission has also said it is “stepping up” its monitoring of the main agricultural markets impacted by the war.
Following a decision published today, member states will have to notify the commission of their monthly level of stocks of cereals, oilseeds, rice and certified seeds of these products held by relevant producers, wholesalers and operators.
The commission has also launched a dashboard presenting statistics on prices, production, and trade of milling wheat, maize, barley, rapeseed, sunflower oil, and soya beans at EU and global level