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Thursday, 23 July 2015 00:00 - - {{hitsCtrl.values.hits}}
Livestock breeders block a road to the Mont Saint-Michel (background) in the northwestern region of Normandy, France, to protest against a squeeze in margins by retailers and food processors, 21 July
PARIS (Reuters): France announced measures worth up to 1.1 billion euros ($1.2 billion) on Wednesday to support its livestock farmers and try to halt protests which have escalated in recent days into road blockades in the northwest.
“The aim of the plan is to deal with the emergency but also to bring sustainable solutions,” Prime Minister Manuel Valls said at the presidential Elysee palace after a cabinet meeting.
President Francois Hollande had on Tuesday promised a plan to help struggling cattle, pork and dairy producers suffering from low prices, tough competition and a squeeze on margins by food processors and retailers.
French Agriculture Minister Stephane Le Foll, who has said about 10% of livestock farmers were on the brink of bankruptcy, detailed 24 measures mainly aimed at easing struggling farmers’ cash flow.
The package offers up to 600 million euros ($655 million) worth of tax exemptions and delayed payments that would cost the French treasury about 100 million.
In addition, the state would guarantee up to 500 million euros worth of loans for producers through its public investment bank, mainly to reimburse debts to suppliers. That would cost the government another 100 million euros.
In a set of longer term measures, France also aims to reverse a drop in competitiveness on local and export meat and dairy markets, notably against other European countries where prices have been significantly lower, with an initial focus on Greece, Turkey, Lebanon and Vietnam, Valls said.
France’s largest farm union FNSEA welcomed the plan.
“This is going in the right direction,” FNSEA chairman Xavier Beulin told reporters.
Farmers were starting to lift some of the blockades.
Traditionally mostly right-wing, French farmers have become increasingly frustrated with the Socialist government of Hollande, saying increased paperwork and high labour costs are the main cause for their loss in competitiveness.
Russia’s embargo on European food imports and a milk surplus linked to the end of EU quotas, lower Chinese demand and supermarkets’ pricing power have further dented their profits and morale.
Polls released at the latest elections showed a rising number of farmers were turning to the far-right National Front.
Le Foll was due to meet sector representatives later on Wednesday, largely to convince the meat industry to respect a deal signed in June, in which they agreed to raise prices paid to farmers.
