The government is negotiating a hundred million dollar injection for frozen fruit

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“We are in a completely unprecedented situation, where in the Czech Republic we have the greatest damage in a hundred years. We haven’t seen anything like it since 1929. The harvest in the Czech Republic will be almost zero, the damage is 90-100 percent. In the whole of the Czech Republic, we harvest only twenty percent of the fruit harvest,” says Minister of Agriculture Marek Výborný (KDU-ČSL).

The help he is proposing to affected farmers is also unprecedented. At Tuesday’s meeting, the government will discuss support for affected orchardists from the so-called program for solving risks and crises in agriculture. Since 2016, when it was launched, it has been used several times to cover damage caused by frost, drought and tornadoes. However, the aid never exceeded CZK 100 million.

Minister Výborný will propose to the government that the injection from the program be 150-200 million crowns. He told the editors in an interview on Monday evening. However, the resulting amount spent by the state can be much higher. There is a debate about compensation options that should cover damages to fruit growers, winegrowers, as well as forest and fruit nurseries. The frosts in recent weeks have left approximately one billion in damage to the orchards and another two billion to the vineyards, according to the Union of Winemakers.

Another aid, aimed mainly at small and medium-sized farms, is supposed to be the support of operational loans through the Supporting Agricultural and Forestry Guarantee Fund (PGRLF). “It would require a transfer from the state budget in the considered amount of 300 million crowns,” said SZ Business Minister. “Orchardists in the Czech Republic will de facto lose one year of income. We have to realize that many fruit growers are only dedicated to fruit growing itself,” he reasoned. In general, the system of state guarantees is set up in such a way that the state subsidizes part of the principal or interest of loans.

At the same time, together with the representatives of the injured fruit growers and colleagues from the Ministry of Labor and Social Affairs, the Ministry of Agriculture is discussing the possibilities of supporting employment in the form of a kind of quasi-kursarbeit. In particular, large fruit growers do not know what to do with dozens of regular employees, for whom they will not have work or money for salaries.

The first meeting with fruit growers on this topic was this morning. According to the chairman of the Fruit Union of the Czech Republic, Martin Ludvík, there are several variants in play. “The program could be open to both small and large farms, but I think it would be mainly a few larger businesses that have post-harvest processing and supply to retail chains that would request reimbursement of labor costs,” he told the editors after the meeting.

Businesses with post-harvest processing of fruit, such as sorting, packing and storage, are more labor-intensive and in some cases supply stores and wholesalers year-round.

According to Ludvík, such a program would help save hundreds of jobs. According to the existing rules, state compensation can cover a maximum of 60 percent of wage costs. How much it will be in this case is not yet clear.

The Czech Republic also wants to tap into money from the EU’s agricultural crisis reserve. Excellent discussed this last week with the European Commissioner for Agriculture, Janusz Wojciechowski.

“We asked the European Commission for 100 million euros. Although of course I understand that the amount corresponds to a third of the rest of the reserve and is probably not completely realistic, we will discuss it with the European Commission,” said Výborný in an interview for SZ Byznys, which we will publish during the week. This amount corresponds to CZK 2.5 billion.

However, this money should not end up only with fruit growers, but also with other farmers whose crops were significantly damaged by frost. However, support for greengrocers is not counted on, the damage to their crops is minimal, according to the ministry.

“Unfortunately, there was a significant impact on forest and fruit nurseries as well as some vineyards in Bohemia. In Moravia, the damage to the vineyards is about 30 percent, but the big problem is the Czech vineyards, Mělník, northern Bohemia, Mostec, where absolutely everything froze. That’s why we are considering whether to find a way to include them in support,” explained Výborný.

At the end of last week, the department sent a letter to the European Commission with a request for this support, where it described the extent of the damage.

The Ministry of Agriculture has previously stated that the aid paid will also vary depending on whether the entity in question had insurance. Farmers without insurance would receive less compensation.