Factsheet for measure
PT-2023-50/3459
– measures in Portugal
Financial support for drought
Apoio financeiro à seca
Background information
According to the data recorded as part of the agro-meteorological and hydrological monitoring for the 2022/2023 hydrological year, the drought situation in mainland Portugal, which began in March, worsened significantly the following month and reached the whole of mainland Portugal in May.
In fact, for several months, there were consecutive days with high average temperatures, including heat waves, in addition to low rainfall and low water content in the soil, aggravated by the accumulation of drought episodes that have occurred in some areas of the country in recent years.
As a result of these conditions, coupled with a significant increase in the costs of production factors, there has been a worsening of the difficulties experienced by farmers and livestock producers, particularly in the rain-fed cereals and extensive livestock sectors.
These sectors are therefore facing serious financial difficulties, including liquidity, which makes it necessary to take measures to alleviate the difficult situation they are going through. These measures were set out in Ordinance 430-A/2023.
On 31 January 2024, the Government announced new measures aimed at ensuring the stability of support for farmers and the impact of the drought on their income. These measures were approved in the Council of Ministers on 8 February 2024.
Content of measure
Ordinance 430-A/2023 of 12 December established a support measure based on supporting the sectors most exposed to natural water availability, extensive livestock farming, beekeeping and autumn/winter cereals under rain-fed conditions, in view of the impact of production losses and the increase in external food costs resulting from the drought.
The measure in question is a Financial Support for the agricultural sectors affected by the drought in Portugal Mainland, with the aim of promoting the economic sustainability of agricultural production, the maintenance of its activity and the capacity to supply the market.
The overall budget allocated to support is €31.58 million, of which up to €20 million will come from national funding, broken down as follows:
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Beef cattle - €17.24 million;
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Sheep or goats - €10.65 million;
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Pigs of indigenous breeds - €0.32 million;
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Beekeeping - €1.79 million;
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Rain-fed autumn/winter cereals - €1.58 million.
Farmers who own agricultural holdings and were beneficiaries under an application submitted in 2023 are eligible for the support provided. The application submission period ran from 14 December to 28 December 2023.
The support provided for in this Ordinance takes the form of non-refundable flat-rate aid. The support is paid by Institute for Financing Agriculture and Fisheries (Instituto de Financiamento da Agricultura e Pescas, IFAP, I. P.), by bank transfer, until 31 January 2024.
New measures aimed at ensuring the stability of support for farmers and mitigating the effects of drought on farmers' incomes were announced by the Government on 31 January 2024 and approved by the Council of Ministers on 8 February 2024. The measures directly related to drought are as follows:
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Production support to the value of €200 million, for the whole country, ensuring coverage of the production shortfalls recorded - Approval of the measures at the next Council of Ministers, 8 February. Payment will be made available after approval by the European Union.
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Creation of a credit line to support cash flow, totalling €50 million, with 0% interest rate - Available to all farmers immediately, as early as February.
Use of measure
According to the Institute for Financing Agriculture and Fisheries, on 26 January 2024, this Institute paid out Financial Support for Drought to farms based in mainland Portugal, amounting to approximately €28.9 million.
These payments, covering the sectors set out in Ordinance 430 A/2023, are broken down as follows:
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Beef cattle - €16.4 million
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Sheep or goats - €9.4 million
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Pigs of indigenous breeds - €0.3 million
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Beekeeping - €1.3 million
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Rain-fed autumn/winter cereals - €1.5 million.
Target groups
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Workers
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Businesses
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Citizens
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Does not apply to workers
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Other businesses
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Does not apply to citizens
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Actors and funding
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Actors
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Funding
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National government
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European Funds
National funds
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Social partners
Social partners' role in
designing the measure
and form of involvement:
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Trade unions
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Employers' organisations
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Role
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Unknown
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Unknown
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Form
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Not applicable
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Not applicable
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Social partners' role in the
implementation, monitoring and assessment phase:
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No involvement
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Main level of involvement: Unknown
Involvement
There is no information on the involvement of social partners.
Views and reactions
The Confederation of Agricultures of Portugal (CAP) issued a clarification document questioning the transparency of the Ministry for Agriculture on the amounts of support actually paid under the measure.
According to this clarification, as the Minister sees it, this is support totalling €320 million. From CAP's point of view, the real new amount of support in 2024 is only €60 million, which is awaiting authorisation from Brussels and can only be paid once the affected farmers have applied.
Sectors and occupations
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This case is sector-specific
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Economic area
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Sector (NACE level 2)
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A - Agriculture, Forestry And Fishing
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A1 Crop and animal production, hunting and related service activities
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This case is not occupation-specific.
Sources
