The European Commission has approved a €15 million aid package to support Portuguese wine producers facing severe market disruptions. This emergency measure aims to address the accumulation of wine stocks due to decreased sales and increased production last year, helping to stabilize the market and prevent a prolonged crisis.

Key Facts

• The European Commission has allocated €15 million from the agricultural reserve to assist Portuguese wine producers.
• The aid will support temporary crisis distillation to remove excess wine volumes from the market.
• The alcohol obtained from distillation will be used for industrial purposes to avoid market distortion.
• National authorities will manage the distribution of aid based on applications from producers, cooperatives, distillers, and enterprises.
• Portugal must notify the European Commission about the implementation details, including the quantities of wine withdrawn from each region.

Background

The European Commission’s decision to mobilize €15 million from the agricultural reserve comes in response to severe market disturbances faced by Portuguese wine producers. The measure is part of a broader €77 million aid package that also supports farmers in Austria, Czechia, and Poland, who have been affected by adverse climatic events.

Crisis Distillation

The primary focus of the aid is on temporary crisis distillation, a measure designed to remove excess wine volumes from the market. This step is crucial to rebalance the market and prevent a more extensive crisis. The alcohol obtained from this distillation process will be restricted to industrial uses, such as disinfection, pharmaceuticals, and energy production, to avoid distorting market competition.

Implementation and Oversight

National authorities in Portugal will be responsible for distributing the aid. They will set the rules for eligibility and application, ensuring that producers, cooperatives, distillers, and wine enterprises can benefit from the support. The aid must be paid to recipients by April 30, 2025.

Portugal is required to inform the European Commission about the execution of this measure, including the quantities of wine withdrawn from the market in each region. This transparency is essential for monitoring the effectiveness of the aid and ensuring compliance with EU regulations.

Broader Impact

In addition to supporting Portuguese wine producers, the European Commission has also approved aid packages for farmers in Austria, Czechia, and Poland. These countries have faced significant challenges due to unprecedented climatic events, such as frost and hail, which have severely impacted their fruit, vegetable, and wine sectors.

Janusz Wojciechowski, the European Commissioner for Agriculture, emphasized the importance of a strong agricultural reserve in the Common Agricultural Policy (CAP) budget. He stated that the stability of farmers is fundamental for the stability of society, and the Commission will continue to support them in times of need.

Future Outlook

The European Commission has established a high-level group on wine policy to address the ongoing challenges in the wine sector. This group is expected to formulate recommendations by early 2025, aiming to provide long-term solutions for the industry’s stability and growth.

The €15 million aid package is a temporary but crucial measure to help Portuguese wine producers navigate the current crisis. By addressing the immediate market imbalances, the European Commission aims to pave the way for a more stable and prosperous future for the wine sector in Portugal and beyond.