FRANCE

France: The Government announces a series of measures to support the agricultural sector in the energy crisis

Faced with the sharp rise in prices of oil, gas and fertilizers which are increasing farmers' production costs, the Government announces a set of exceptional measures designed to preserve their cash flow and support the viability of farms and therefore the food supply in France.

Posted on Mar 26 ,00:15

In an international context marked by significant tensions, the prices of gas, oil, and agricultural inputs have risen considerably. The structural response to this crisis is diplomatic, with France committed to ending the conflict. The duration of this crisis is uncertain and is leading to significant volatility in global hydrocarbon prices. These developments are directly impacting the cash flow of farms, particularly in certain highly exposed sectors.

In response to this situation, the Minister of Agriculture acted immediately by mobilizing all stakeholders: agricultural professional organizations, energy suppliers, fertilizer producers, and banks. This mobilization continues: the Minister will meet with industry professionals again in the coming days. A crisis unit has also been established to monitor the situation daily and provide rapid responses to any difficulties encountered on the ground.

In order to respond to the emergency, several short-term measures have already been deployed, including the issuance of health certificates after the fact, following agreement from the European Commission, to facilitate the rerouting of blocked goods or the repatriation of domestic animals.

The Government continues to support the sector through new measures to sustainably support farms and promote inter-sector solidarity:

• Deferral of social security contributions: a payment period without fees or surcharges will be granted to agricultural businesses that request it;
• Spreading out tax deadlines: agricultural businesses can request a spread out of their tax deadlines from their departmental directorate of public finances;
• Implementation of exceptional short-term loans by Bpifrance, to support the cash flow of agricultural operations most exposed to rising fuel prices;
• Seeking a local agreement with banks and distributors, particularly to study support for agricultural production and to call for flexibility in the handling of individual cases of companies facing cash flow difficulties due to the ongoing crisis.

These targeted measures complement the more structural mechanisms designed to help farms that have been permanently affected by the volatility of prices experienced in recent years, in particular the consolidation loan package guaranteed by the State up to 70%, which can reach up to 500 million euros in outstanding amounts, which helps farms in their transformation and strengthen their resilience to economic shocks.

Beyond these emergency measures, the Government also intends to take action to improve the resilience of the agricultural sector. Dependence on imported inputs, particularly fertilizers and CO2-emitting fossil fuels_, is a major challenge to French agricultural sovereignty. France continues to advocate at the European level for the need to adapt certain mechanisms, notably the Carbon Border Adjustment Mechanism (CBAM), so as not to penalize farmers in the current context.

“Faced with the sharp rise in energy prices, we must be there to support our farmers. The measures announced provide concrete and immediate solutions to their cash flow difficulties, while also preparing for the future by strengthening the resilience and sovereignty of our agriculture”, Annie Genevard, Minister of Agriculture, Agri-food and Food Sovereignty.

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