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EU extends energy crop subsidies to new members

EU farming ministers decided at a meeting in Brussels on Monday to allow new member states access to special subsidies for so-called energy crops, used as feedstock for biofuel, Hungarian Agriculture Minister József Gráf said following the meeting.

The ministers proposed making a €45-per-hectare subsidy for energy crops available to EU newcomers. New member states will be eligible for 100% of the subsidy, unlike other subsidies, of which they may only claim 25%. Gráf said energy crops would become an increasingly important part of Hungary's farming sector. He estimated as many as 2 million tons of the country's 8 million-9 million ton maize crop could be used to generate energy in future. The farm ministers also decided to allow growers of wood fuel access to special subsidies, Gráf said.
The decision will allow member states to pay for up to half of the costs of planting "energy forests". At the request of several member states, the ministers agreed to extend the transitional system of farm subsidies up to 2011, rather than switching over to the EU's new farm-type subsidies from 2009 as planned earlier. Hungary, however, is prepared to make the change from the current simplified land-based subsidies in 2009, Gráf said. Talks with different farming sector professional groups on the advantages of the new system will determine when it is introduced, he added. Subsidies for animal farmers and dairy farmers are an especially important issue, as more freedom is allowed the state under the current system to determine special support for these farmers.