Germany's US$1.1 billion package supports agriculture industry

Germany's EUR750 million (US$1.1 billion) support package is benefiting the agriculture industry through a swift implementation of the measures.

The package is supporting agricultural holdings that are experiencing liquidity bottlenecks, in particular due to collapsing milk prices, said Minister of Agriculture, Ilse Aigner.

The programme's central element is the EUR500 million grassland milk package. It comprises a grassland payment of about EUR37 per hectare and a cow premium of about EUR20 per cow for the years 2010 and 2011.

This will help dairy farms to tide through these difficult times and promotes the use of grassland. At the same time, dairy farmers will see improved prospects for continuing to preserve and sustainably use meadows, grazing land and pastures, which can also benefit climate protection, said Aigner.

The remaining funds from the grassland milk package will be used to reduce the contributions towards the agricultural accident insurance scheme, thus easing the financial burden on all holdings. This will be of particular benefit to dairy farms, due to the comparatively high insurance premiums they pay at present.

In addition, the 2009 single farm payments are brought forward by one month to December 1. The tax relief on agricultural diesel will now become permanent.

The EU milk fund is set to increase to EUR300 million per year from 2010 to 2013. Countries have the option of spending these funds specifically on dairy farmers.

US$1 = EUR0.662668 (Nov 26)