French Farmers Urge EU Aid to Offset Poor Grain Harvest Impact

French wheat producers are urging the European Union to release its crisis funding, known as the agricultural reserve, and to enhance state aid for the sector, as ongoing rains since last autumn are leading to disappointing harvests in key grain-producing regions across Europe.

Philippe Heusele, secretary general of the General Association of Wheat Producers in France (AGPB), expressed concerns, stating, “As the harvest progresses, the results become increasingly discouraging. This could be the worst year for soft wheat since 2016,” in comments made to Euractiv.

The relentless rain has severely impacted cereal and wheat growers in Western Europe, leading to reductions in both planted areas and yields.

On July 28, French Agriculture Minister Marc Fesneau visited a farm in central France, announcing “exceptional measures to support cash flow” that could be activated at both national and EU levels, alongside potential actions from banks and insurance firms.

While the minister noted the possibility of negotiating with Brussels to access the agricultural reserve—previously termed the crisis reserve—no definitive actions have been established yet.

The AGPB is strongly advocating for the French government to request the activation of these funds. The agricultural reserve, part of the Common Agricultural Policy (CAP), amounts to €450 million annually and aims to provide financial support to farmers experiencing hardships.

This reserve was initially activated in 2023 in response to Russia’s invasion of Ukraine, assisting Eastern European nations in managing increased cereal and oilseed imports.

Yield Losses in Europe

Heusele projected that France will yield approximately 62 tonnes of soft wheat per hectare this year, marking a decline of 15-17% compared to 2023.

At the EU level, the latest market report from the International Grains Council (IGC), released on July 28, forecasts the EU’s wheat production will drop to a four-year low of 128.7 million tonnes.

Conversely, Eastern European conditions appear somewhat more favorable. In Romania, another significant soft wheat producer, output is expected to exceed last year’s levels, with projections of 4.65 tonnes per hectare compared to 4.55 in 2023, as reported by the EU crop monitoring service (MARS).

Nevertheless, winter crops have faced the brunt of the persistent rain throughout the growing season.

Barley has suffered the most, with the latest data from the French Ministry of Agriculture indicating a 17% decrease compared to last year.

This situation mirrors that in Germany, Europe’s second-largest producer, where winter barley yields are anticipated to fall by 6% from 2023 according to the latest projections from the German Association of Farm Cooperatives (DRV).

Agricultural Reserve

For rapeseed, forecasts indicate a 7.7% decline year-on-year in France, with Germany similarly facing challenging conditions as reported in national media.

A source within the French agriculture ministry revealed that the minister is exploring options to utilize the crisis reserve to bolster cash flow.

During the Agriculture and Fisheries Council on May 27, member states emphasized the need to reinforce this mechanism.

They also called for an increase in de minimis aid—subsidies that EU member states can offer without prior Commission notification—to €50,000 per farm over three years, up from the current €20,000 or €25,000 with a centralized subsidy register, a request backed by French producers including the AGPB.

The European Commission is currently considering raising the ceiling to €37,000 per farm in light of inflation.

While the French agriculture ministry has not yet committed to utilizing state aid, the discussion around the de minimis ceiling is ongoing, with the ministry indicating that “it’s unlikely the ceiling of €20,000 per farm will be reached.”

The ministry plans to provide updates on the potential activation of European and national aid after assessing the grain harvest in mid-August.