The ongoing and prolonged drought situation in several EU countries is affecting the production of arable crops and animal feed, which could have an impact on farmer income, increase their input costs and potentially give rise to an animal welfare issues, if there is a shortage of fodder later in the year.
Commissioner for agriculture, Phil Hogan, said: “The Commission, as always, is ready to support farmers affected by drought using a number of instruments, including higher advance payments, derogations from greening requirements and state aid… I am encouraging all Member States to look into all possible actions and measures provided for in our legislation.”
The Commission is standing by European farmers. In addition to support under the existing Common Agricultural Policy (CAP) legislation, two specific decisions have been taken to help farmers deal with droughts
- higher advanced payments: farmers will be able to receive up to 70% (up from 50%) of their direct payment and 85% (up from 75%) of payments under rural development already as of mid-October 2018 instead of waiting until December to improve their cash flow situation
- derogations from specific greening requirements, namely crop diversification and ecological focus area rules on land lying fallow, to allow such land to be used for the production of animal feed
Consideration is also being given to the adoption of further derogations to greening – for example, catch crops and green cover – to allow farmers more flexibility to produce fodder and to accommodate the need to sow winter crops in a timely manner.
Given the seriousness of the situation, the Commission is closely following developments. In addition to these measures and the continuous monitoring of the drought situation and its impact with European satellites, the Commission is in contact with all Member States to receive updated information of the impact of the spring and summer drought on their farmers. The information, which is requested by 31 August, will be used to assess the adequacy and appropriateness of the Commission’s response and to inform any decisions about the modification of the measures already taken or in relation to any additional measures which may be considered appropriate.
Under existing agricultural state aid rules, aid of up to 80% of the damage caused by drought (or up to 90% in Areas of Natural Constraint) can be provided, subject to certain specific conditions. The purchase of fodder can qualify for aid as either material damage or income loss.
Compensation for damage can also be granted without the need to notify the Commission (the so-called “de minimis aid”). Member States may grant aid of up to €15 000 per farmer over three years.
With regards to Rural Development, a range of possibilities is provided for in the current CAP legislation:
- where a Member State recognises the drought situation as a ‘natural disaster’, they may provide support of up to 100% for the restoration of agricultural production potential damaged by the drought. The money can be used for investments such as the re-seeding of pastures for example. This measure can be activated retroactively.
- farmers can notify their respective national authorities about cases of exceptional circumstances, and may be released by their Member State from their commitments under various schemes (including agro-environment-climate, forest-environment-climate and organic). For example, farmers will be allowed to use buffer strips for fodder. In such circumstances, no penalties would apply, but the farmer would forego the parts of the payment that are linked to such commitment(s) for the year(s) in question.
- in respect of Agricultural Environmental Climatic Measures (AECM), where the environmental purpose of the measure has been met in full, the farmer may, exceptionally, derogate from some of the technical requirements of the measure without penalty. In such cases, Member States would have to decide whether the farmer should still receive his AECM payment in full. The Commission will provide as much assistance and assurance as possible to the member states concerned.
if provided in their existing Rural Development Programmes, Member States can support farmers through risk management instruments. The possibilities include
- financial contributions to premia for crop, animal and plant insurance
- financial contributions to mutual funds to pay financial compensation to affected farmers
- a general income stabilisation tool for farmers by compensating income losses beyond 30 per cent of the average annual income of the farmer
- a sectoral income stabilisation tool compensating sector-specific income losses beyond 20 per cent of the average annual income of the farmer, and
- the rural development programme may be amended
Member States have the possibility to modify their rural development programme once a year to include the measures set out above.
A decision on derogations from specific greening requirements was voted on 12 July for 8 member states (Denmark, Estonia, Finland, Latvia, Lithuania, Poland, Portugal and Sweden). As other member states request similar derogations, this facility can be extended.