Spain obtains European funds and CAP flexibility for drought-affected farmers and stockbreeders

News - 2023.6.27

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The Minister for Agriculture, Fisheries and Food, Luis Planas, expressed his satisfaction at the end of the Council of Agriculture and Fisheries Ministers - which was held on Monday and Tuesday in Luxembourg - after it was confirmed that Spain will receive funds from the European Union (EU) crisis reserve for farmers and livestock breeders affected by the drought and high temperatures. Spanish producers will also be able to benefit from a series of relaxations of the conditions set out in the Spanish Strategic Plan for the new Common Agricultural Policy (CAP), which came into force on 1 January.

The European Commission (EC) has announced the mobilisation of 330 million euros from the agricultural crisis reserve within the framework of the Common Organisation of Agricultural Markets (CMO), benefiting 22 countries. Of this amount, it has proposed that 81 million euros should go to farmers and livestock breeders in Spain, following the request made by Minister Luis Planas to the Commissioner for Agriculture and Rural Development, Janusz Wojciechowski, on 24 April. The proposal is expected to be put to the vote on 10 July.

This figure is the highest amount for an EU country in the agricultural reserve, in this case to compensate for part of the effects of the lack of rainfall and high temperatures on Spanish livestock and crops. In particular, the most affected sectors, apart from livestock, are the fruit and vegetable, wine, cereals and oilseed sectors, where economic losses can affect the viability of producers and farms.

Increased advance payment of CAP support

The Commission has also accepted another of Spain's requests: the increase, up to 70% of the total, of the advance of direct payments of CAP aid from October, and up to 85% of the advances of aid granted in the rural development framework.

To speed up disbursement, the EC has also agreed that it should be possible to make advance payments - in the case of direct payments for the single application for 2023 - before on-the-spot checks have been completed.

The EU Executive has also submitted two proposals for regulations with temporary emergency measures that establish derogations for CAP aid for fruit and vegetable and wine-growing activities.

The proposed flexibilities in Community support for the operational programmes (OP) of fruit and vegetable producer organisations (FVPOs) include the removal of restrictions on the use of funds for crisis prevention and management measures, the increase to 60% in the level of EU funding, the introduction of facilities for the modification of OPs and the possibility of calculating the value of marketed production on a three-year average of five years, so that seasons of lower volumes can be eliminated.

For the wine sector in the areas affected by the drought, Brussels has given the green light to the Spanish request, in the framework of restructuring and converting vineyards, to relax the requirements for the transition between the support programme and the sectoral intervention contained in the Spanish Strategic Plan for the CAP 2023-2027. It has also authorised the postponement of the validity of authorisations for new planting and replanting of vineyards that expire this year, so that they can be used in the following year.

In his speech to the Council this morning, Minister Planas added Spain's support to the Latvian proposal for Brussels to allow derogations in the application of the CAP when extreme adverse weather events affect farming and livestock farming. In his opinion, "the strategic plans must contain the flexibility so that the member states can, within our objectives, carry out these flexibilities, logically, within EU regulations".

Measures complementary to those taken by the Government

The funds from the EU crisis reserve and the measures that make the implementation of the CAP more flexible make it possible to reinforce the support put in place by the Government of Spain to help producers following the rise in production costs due to the drought and the effects of the war in Ukraine.

The content of Royal Decree-Law 4/2023 approved by the Council of Ministers at its meeting on 11 May involves a contribution of 2.19 billion euros in the primary sector through urgent agricultural and water measures. Of this amount, 636 million euros is direct aid to support farmers and stockbreeders in coping with the difficult situation caused by the lack of rainfall.

In particular, stockbreeders who depend on the availability of grassland and fodder crops for their activity will receive direct aid totalling 355 million euros. Farmers whose crops have been most affected by the drought will receive a further 276.7 million euros, and beekeepers will receive a total direct grant of 5 million euros.

The Government has also increased subsidies to agricultural insurance holders to the maximum allowed by increasing the budget by 40.5 million euros. The aid, therefore, now amounts to 70% of the cost of the policies already taken out, including the regional aid, as well as improving the conditions of the ICO-MAPA-SAECA financing facility and the SAECA guarantees for the loans.

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