Farmers opposed to European agriculture reforms and a free-trade deal with South American bloc Mercosur protest in front of the European Parliament in Brussels, Belgium, December 18, 2025. NICOLAS TUCAT / AFP
The European Union on Tuesday, January 6, offered a carrot to farmers angered at a trade deal with South American bloc Mercosur, promising to unlock funds for the sector as it seeks to get the accord over the line. The European Commission, the EU’s executive arm, said it plans to tweak its budget proposal for 2028-34, which has come under fire from agricultural groups, to allow farmers early access to around €45 billion.
The move comes amid a push to ease the qualms of some countries over the Mercosur deal that Brussels hopes to ink next week. It was welcomed by Italy, which holds the deciding vote on the accord. “This is a positive and significant step forward in the negotiations that will lead to the new EU budget,” said Italian Prime Minister Giorgia Meloni.
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More than 25 years in the making, the Mercosur deal would create the world’s largest free-trade area, boosting trade between the 27-nation EU and the bloc comprising Brazil, Paraguay, Argentina and Uruguay. But it has alarmed many European farmers who fear they will be undercut by a flow of cheaper goods from agricultural giant Brazil and its neighbors.
Thousands protested in Brussels last month, venting their anger also at EU plans to overhaul its system of farm subsidies, which critics say would result in farmers receiving less money. In a Tuesday letter, EU chief Ursula von der Leyen unveiled budget changes she said would “provide the farmers and rural communities with an unprecedented level of support.”
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The letter was released as EU agriculture ministers are due to gather in Brussels on Wednesday for an extraordinary meeting to try to get the Mercosur deal over the line. Member states are expected to then vote on the text on Friday, which the commission hopes will clear the way for its signature.
Plans to seal the accord in December ran into a late roadblock as heavyweights Italy and France demanded a postponement over concerns for the farming sector. Germany and Spain are strongly in favor of the agreement, believing it will provide a welcome boost to their industries, which have been hampered by Chinese competition and tariffs in the United States.
At a time of global trade tensions, the deal would help the EU export more vehicles, machinery, wines and spirits to Latin America. In return, it would facilitate the entry into Europe of South American meat, sugar, rice, honey and soybeans.
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