A general view shows the Robert Schumann square during clashes between Belgian riot police officers and protesters as farmers and dairy farmers from all over Europe take part in a demonstration outside an European Union farm ministers emergency meeting at the EU Council headquarters in Brussels. Thousands of farmers gathered in the European capital calling for more help with low prices and high costs in the European Union’s largest agricultural producer country.

Reuters/Brussels

The European Commission announced a €500mn ($557mn) package of measures yesterday to provide relief for farmers stung by slumping prices, triggered partly by the loss of exports to Russia due to EU sanctions against the country.
The crisis has triggered a wave of protests which culminated yesterday with nearly 5,000 farmers and more than 1,000 tractors arriving in Brussels, where an emergency meeting of the EU’s Agriculture Council was being held.
“This package will allow for €500mn of EU funds to be used for the benefit of farmers immediately. This is a robust and decisive response,” European Commission Vice-President Jyrki Katainen said.
The package was discussed by the EU’s Agriculture Council, which consists of farm ministers from member states, yesterday.
Some details have not yet been finalised.
“We are pleased with the initial reactions (from ministers),” Commission spokesman Daniel Rosario said.
The European Commission – the EU executive – said that it was seeking to help farmers with cash-flow difficulties, stabilise markets and improve the functioning of the supply chain.
The plan allows member states to advance some payments to farmers and the Commission said it was working closely with the European Investment Bank to design financial instruments where repayments were linked to commodity prices.
Albert Jan Maat, president of farmers group Copa, said that Russia was one of the EU’s main markets and sanctions imposed as part of the dispute over Ukraine last year had led to the loss of about €5.5bn of agri-food exports.
“This situation is not our fault yet it is our sector that is being hit the most. EU farmers are paying the price for international politics,” he said.
Farmers have been facing a worsening cash flow crisis.
“We are now in early September, bills have not been paid for the summer and a lot of milk producers will not be able to see their way through the winter unless cash is put on the table immediately,” Mansel Raymond, dairy chairman at Copa said.
Milk prices paid to EU farmers are down 20% from last year at €0.30 a litre on average.
In the Baltic States, which has been worst hit by Russian sanctions, prices are even lower at around €0.20.
The Commission said it had not yet finalised the national distribution of the support funds but there would be “particular regard to those Member States which have been most affected by market developments”.
The EU executive refused to raise the intervention price for dairy products, a move sought by farming groups and supported by France, Italy, Spain and Portugal.
Much of the funds come from larger-than-expected receipts from a dairy super-levy imposed on those who exceed their quotas under a system which was abolished earlier this year.
The super-levy raised more than €800mn while only €440mn was included in the EU budget, creating additional funds to distribute.