France to offer farmers help over high fuel costs

French Prime Minister Dominique de Villepin said yesterday he would announce measures to help farmers cope with the soaring cost of fuel.

Mr Villepin said he would announce the measures today, when he is due to address a farmers' meeting in Rennes.

"We want to take into account the situation faced in particular by farmers. If we compare their situation with other categories, farmers face particular difficulties. They cannot pass on the rise in fuel prices, so we have to provide some specific help," Mr Villepin told France's RMC radio.

He said that it would involve adjustments to fuel duties, although he rejected any idea of a general duty cut or a return to the system of a floating fuel tax.

Farm unions have demanded government help to offset the rising cost of fuel, but the main FNSEA union has said it would wait for Villepin's speech before considering direct protests.

However, farmers in the north of France yesterday staged a demonstration to demand tax cuts. Between 100 and 200 farmers took to their bicycles in the town of Arras. Two tractors, their motors off, were pulled by horses at the head of the procession. "Symbolically, we are protesting without fuel because it costs too much," Christophe Polin of the local FDSEA union said.

"We are asking for a subsidy or a tax credit, simply to be able to survive," he added.

French truckers, who have already blockaded some fuel depots, were staging several go-slow operations on roads in the area around the northern city of Lille.

Farmers were also protesting in a separate dispute over the price of milk yesterday, blocking dairies in Brittany and the Loire valley.

Unions say the price of diesel used by farmers has doubled since 2003 and is now around €710 per 1,000 litres.

They say farmers' four cent reduction in fuel duties, introduced last year, is no longer sufficient.

The FNSEA has called for tax concessions on fuel, the cancellation of a land tax worth €700 million a year and compensation from the state fund that deals with farm crises.

"The increasing costs of energy are having a direct impact on fuel prices but also an indirect price impact on drying costs and fertiliser," Jean-Michel Lemetayer, head of the FNSEA, told a news conference in Paris last week.

The government has already agreed to compensate farmers in some regions over losses linked to the severe drought in France this year. Farmers in 17 of mainland France's 96 departments have so far been declared eligible to file compensation claims.