E.U. Approves €540 Million in Emergency Aid for Farmers

More money is becoming available to European farmers, while member states will have greater freedom to decide how it is distributed and which agricultural sectors and producers most urgently need support.

In response to persistently high fertilizer and energy costs linked to the Middle East crisis, the European Union is deploying €540 million from its agricultural reserve, an emergency fund used to address major agricultural crises.

The E.U. has also adopted regulatory changes giving national governments greater flexibility in the use of Common Agricultural Policy funds. The CAP is the bloc’s main system of farm subsidies and rural development funding.

The changes allow governments to advance payments to farmers, redirect available funds and establish temporary liquidity support.

On July 17, member states endorsed the European Commission’s proposal to distribute €540 million among all 27 E.U. member states.

France will receive the largest allocation, at €107.1 million, followed by Poland with €66.6 million and Germany with €60.3 million.

Among the bloc’s main olive oil-producing countries, Spain will receive €50.2 million, Italy €45.6 million, Greece €20.8 million, Portugal €9.5 million and Cyprus €1.5 million.

The crisis measure gives national governments significant room to set their own priorities. They may supplement their allocations with domestic funding worth up to 200 percent of the E.U. contribution.

The Commission said the money should compensate farmers most affected by economic losses linked to higher fertilizer and energy costs.

Member states must define their priorities using objective and non-discriminatory criteria, avoid market distortions and ensure that farmers are not compensated more than once for the same losses.

National governments will determine which producers have been most severely affected, how much each will receive and whether particular sectors, products or production systems should be prioritized.

The design of each national aid scheme will determine whether olive farms are eligible and how their payments are calculated.

Member states must distribute the emergency aid by February 28, 2027. The Commission said quick action is needed because farmers will soon have to make purchasing and production decisions ahead of the 2027 production season.

Alongside the €540 million allocation, the Council of the European Union has adopted a separate regulation expanding the options available to governments under the current CAP.

Although the two measures rely on different funding channels, both form part of the E.U.’s wider response to elevated fertilizer and energy costs.

The regulation creates a temporary liquidity scheme within rural development programs for farmers most affected by increased fertilizer and other production costs.

It may be financed with resources from the European Agricultural Fund for Rural Development that might otherwise remain unspent.

The EAFRD may finance up to 65 percent of eligible public expenditure under the new scheme. Member states may provide additional national funding of up to 200 percent of the EAFRD contribution.

To accelerate distribution and reduce administrative work, support may be paid as a fixed amount per hectare and implemented through national CAP strategic plans.

For the 2026 claim year, the regulation raises the maximum advance on direct payments from 70 to 75 percent and allows member states to issue those payments earlier than usual.

Governments may also adjust their direct-payment allocations for 2027 to reflect national priorities and changing conditions in their agricultural sectors.

The latest measures follow the E.U.’s recent suspension of tariffs on imports of ammonia and urea from several countries. The move was intended to increase the availability of nitrogen fertilizers and reduce import costs.

While the tariff suspension targets fertilizer prices and supplies, the newly approved financial measures seek to ease the pressure already being felt by farmers through direct assistance, advance payments and greater flexibility in the use of agricultural funds.

The European Commission has described the initiatives as part of a broader fertilizer action plan intended to strengthen domestic production, diversify supplies and reduce Europe’s exposure to geopolitical and energy-market disruptions.

Farm organizations have pressed governments to move quickly from European approval to practical national aid schemes.

Irish Farmers’ Association president Francie Gorman recently told members of the European Parliament that the €540 million proposal had yet to produce tangible support for farmers.

He warned that farmers needed certainty before purchasing fertilizer for the 2026-27 production season and called for a coordinated European response rather than fragmented national action.

Copa-Cogeca, the European umbrella organization representing farmers and agricultural cooperatives, estimates that the E.U.’s carbon border levy on fertilizers alone will cost farmers €820 million in 2026.

The organization has called for immediate safeguards, greater market transparency and measures to secure fertilizer supplies for 2027.

The Council said the measures are intended to give member states the tools to provide urgent, targeted assistance while encouraging more efficient fertilizer use and the adoption of bio-based, low-carbon and circular alternatives.

The legislative process for the CAP regulation is now complete. It will enter into force the day after publication in the Official Journal of the European Union.