Farmers in all EU Member States to share €420m financial aid: Commission

Phil Hogan, the European Commissioner for Agriculture and Rural Development, yesterday presented EU Agriculture Ministers with the details of the €500m agricultural support package announced last week.

He branded it a “significant statement of support by the Commission for European agriculture.”​

Of the €500m pledged, €420m will be distributed “in a fair, targeted and effective way” ​to all 28 EU Member States “to address problems in the dairy and pigmeat sectors,” ​the EC said. 

Member States will be given “maximum flexibility” ​in targeting such funds, it added.

It has also increased Private Storage Aid (PSA) for skimmed milk powder (SMP) by more than 100% and reintroduced PSA for cheese.

Financial aid​

To reflect the "significant drop in dairy prices"​ in the last year, Member State milk quotas for the 2014/15 season will be used as a base for allocation of 80% of the €420m provided.

The remaining 20% was allocated “on the basis of criteria that ensure additional assistance for farmers in those Member States which have been hit by the fall in pigmeat prices, the impact of the Russian ban, very low milk prices and this summer’s drought,”​ it said.

Germany, which was allocated €69.2m, is the largest beneficiary. 

France and the UK follow, with €62.9m and €36.1m.

Lithuania, Finland, Latvia and Estonia – all of which received financial aid for their dairy farmers in late 2014 – were allocated €12.6m, €9m, €8.5m and €7.6m respectively.

“The difficulties being experienced throughout the EU differ in emphases from Member State to Member State and so the package is constructed in such a way that it responds to those different challenges and, at the same time, provides Member States with the maximum flexibility to tailor aid to their particular needs,”​ said Hogan.

Private storage aid​

Addressing EU Agriculture Ministers, Hogan said the EC was also increasing PSA for SMP and reintroducing PSA for cheese. 

The EC initially introduced PSA for butter, SMP and geographical indication (GI) cheese in August 2014 to “alleviate the impact of Russian restrictions on imports for EU dairy products and to limit the negative effects on the internal market.”​

After less than a month, however, it ended PSA for GI cheese after a “disproportionate surge in interest”​​ ​​from cheese producers in Italy.​​

“Learning from the experience of the last PSA for cheese, the new scheme for cheese will provide for a total amount of 100,000 tonnes to be broken down by Member State, based on their respective cheese production,” ​said Hogan.

Any unused allocations will be redistributed after three months to Member States that wish to make greater use of the PSA for cheese scheme, Hogan added.

Ahead of yesterday’s announcement, DairyReporter took a look at the impact that factors, including the August 2014 Russian ban on Western food imports, have had on EU raw milk prices.​​