Farmers across the European Union are facing a widening cost-price squeeze, according to fresh data from Eurostat. In the second quarter of 2026, the prices farmers received for their produce fell by an average of 5.8% compared with the same period a year earlier – the third consecutive quarter of year-on-year decline. At the same time, the cost of the goods and services they rely on – from diesel to fertiliser and animal feed – climbed by 4.7%.
The figures, released ahead of a meeting of EU agriculture ministers on 28 September, underline the mounting pressure on farm incomes. Ministers highlighted high production costs, particularly for energy and fertilisers, alongside weaker output prices, as key threats to the sector's profitability.
Milk and cereals hit hardest
The divergence is stark in some sectors. Milk prices fell by 16.6% year-on-year, while cereal prices dropped by 5.6%. On the input side, energy and lubricant prices surged by 22%, and fertilisers and soil improvers became 13.4% more expensive.
The pain is not evenly spread. Output prices fell in 20 EU member states, with Denmark recording the steepest decline at 17.2%, followed by Ireland at 16.2%. In contrast, input prices rose in every member state, with the largest increases in Lithuania (16.4%) and Romania (11.7%).
These country-level comparisons, also covering the second quarter against the same period in 2025, reveal a continent-wide trend: even where output prices held up, rising input costs are eroding margins.
Farmers demand action
The response from farming groups has been sharp, particularly over fuel costs. In Spain, farmers met agriculture minister Luis Planas on 22 September to demand urgent aid for rising diesel and fertiliser prices, warning of protests if the government failed to act. The country has seen record diesel prices in recent weeks, adding to the pressure.
In France, the government has announced an expansion of targeted fuel relief measures, though details remain thin. French farmers have also been vocal about the impact of energy costs on their operations.
EU response: €540m compensation package
Brussels has moved to address the crisis. On 17 July, the European Commission announced a €540 million allocation to compensate the farmers most affected by economic losses linked to higher fertiliser and energy costs arising from the Middle East crisis. France is set to receive approximately €107.1 million, and Spain €50.2 million. National authorities will decide how to target the funding at the farmers and sectors most in need.
The package, however, has drawn criticism from some farming groups who argue it is insufficient given the scale of the problem. The broader inflationary environment, with energy costs leading the surge, continues to weigh on the sector.
Some analysts point to structural issues beyond the immediate crisis. The EU's Common Agricultural Policy, while providing a safety net, has been slow to adapt to volatile input prices. Meanwhile, the pressure on Europe to tap oil reserves reflects the wider energy market turmoil.
For now, farmers are left to navigate a difficult autumn. As one EU official put it, the sector is caught between global market forces and domestic policy constraints. The coming months will test whether the bloc's support mechanisms are enough to keep farms viable.
