Paris | Reuters –– A downturn in France’s livestock sector has put thousands of farms close to bankruptcy, the government said Friday, as it seeks to contain a crisis that has undermined a flagship pledge to improve the livelihood of livestock producers.
Farmers say a deteriorating international market, marked by a Russian food embargo, slowing Chinese demand and cheaper supply from other EU countries, has exposed longstanding pressures from business costs and retail consolidation in France.
Livestock accounts for about half of the 500,000 farms in France but generates only a third of 75 billion euros worth of annual output in the European Union’s top agricultural economy. Income from farming also tends to lag those of the crop and wine-making sectors.
“Three crises — in beef, pork and dairy — have coincided,” Agriculture Minister Stephane Le Foll said.
“According to our figures (…) nearly 10 per cent of livestock farms, meaning between 22,000 and 22,500 farms, are on the verge of going bankrupt,” he told daily Le Parisien.
France promoted livestock farming in a reform of the EU’s Common Agricultural Policy for the 2014-2020 period, steering some subsidies towards smaller, livestock-oriented farms and away from larger crop-based ones.
But farmers’ groups say this pales in comparison with losses and debts accumulated over a number of years.
France’s main farmers’ union, the FNSEA, has called for a billion-euro plan to reduce debt and revive investment in livestock agriculture.
“Europe has prevented a Grexit, how can we now prevent an ‘Agrixit’?,” it said on its Twitter account on Thursday.
The French beef sector has suffered years of low prices and revenue, partly due to falling domestic consumption, and it could face another headache as financial turmoil in Greece threatens one of its main export markets.
Global dairy prices have plunged from record highs at the start of 2014, with the Russian embargo and de-stocking by Chinese buyers coinciding with this year’s abolition of production caps in the EU.
France’s Socialist government has tried to address farmers’ complaints of unfair prices in the retail sector by getting food processors and supermarkets to agree last month to raise prices paid to farms.
Conservative politicians, for whom farmers are traditional constituents although they are now increasingly drifting towards the far-right National Front party, have taken up the issue, with the opposition-controlled Senate organizing a special debate on farming this week.
— Reporting for Reuters by Gus Trompiz in Paris.