Drought aid for Austrian farmers: coalition split over billion-euro package Drought aid for Austrian farmers: damage tops €1 billion, but SPÖ and NEOS are holding back. Who gets paid and when — the full breakdown. Topics: News, Economy, Politics.

The record drought has caused €1.08 billion in damage to Austrian agriculture, yet the government cannot agree on drought aid for farmers. Agriculture Minister Norbert Totschnig (ÖVP) wants to support even uninsured farms. Finance Minister Markus Marterbauer (SPÖ) and the NEOS party are holding back: there will be no “whatever it costs” policy. This article explains how big the damage really is, who gets what, why the coalition is fighting and what is blocking the negotiations.

Damage of more than one billion euros

According to the Austrian Hail Insurance (Hagelversicherung), the drought has already caused €1.08 billion in damage. The whole country is affected: grassland, corn, potatoes, sugar beet, pumpkin and soybeans, and regionally also grain. It is a record figure, as krone.at reports.

For comparison: farm incomes were still growing strongly in 2025. Net farm profits climbed by 24.7 percent to €2.55 billion, according to Statistik Austria, while total production value rose ten percent to about €10.9 billion. The 2026 drought is eating up a large part of those gains again.

How hail insurance works

Farms are not entirely left out in the cold. 67 percent of farms are insured — that covers 80 percent of arable land and 40 percent of grassland. Around €400 million of the €1.08 billion is covered by Hagelversicherung. CEO Kurt Weinberger promises: “We pay out quickly.”

In total, 68,000 of Austria’s 101,036 farms are insured. The hail insurance has existed since 1947 and operates on a non-profit basis. With drought index insurance, payouts happen automatically when parameters such as rainfall or hot days are triggered. For damage claims, an expert inspects the fields before payment.

What the federal states demand

Calls on the government from Austria’s regions are getting louder. Credit aid alone is not enough, is the general message. Stephan Pernkopf, deputy governor of Lower Austria and head of the Farmers’ League (Bauernbund), demands a suspension of social insurance contributions for one quarter — that would be around €300 million.

Other farming states, especially Styria, are also pushing for quick decisions. The drought hits the east and south of Austria hardest. How severely individual regions are affected is shown in our overview of the drought in Burgenland, where the south of the province suffers most.

Round table without results

ÖVP Agriculture Minister Norbert Totschnig had again invited to a round table on “Drought in agriculture” on Monday. Representatives of the farming and water sectors took their seats. The outcome remained modest, as ORF reports.

On Friday, a meeting followed in a small but prominent circle: Totschnig, Finance Minister Markus Marterbauer, SPÖ State Secretary Michaela Schmidt and NEOS MP Karin Doppelbauer. This talk also ended without an agreement. Negotiations continue early next week. Totschnig speaks of a “historic drought catastrophe” and an “existential emergency” for farmers.

Why the finance minister and NEOS are holding back

The finance minister assumes that the affected ministries will fund their share through reallocation within their budgets. The double budget will not be reopened, his office says. There will be no “whatever it costs” policy, SPÖ State Secretary Michaela Schmidt also stresses:

We currently have little progress, unfortunately. The ball is now in the coalition partner’s court. There will be no whatever-it-costs policy with us.

— Michaela Schmidt, State Secretary in the Finance Ministry (SPÖ)

NEOS see it similarly. They oppose fresh money and mere symptom-fighting. Fiscal Council chief Christoph Badelt also sees little budgetary room: “We don’t see fresh money.” The ÖVP recently proposed aid of €200 million from social insurance reserves — but it would need counter-financing.

Dispute over uninsured farms

The most sensitive issue is compensation for farms that did not insure themselves. The ÖVP wants to support them too. SPÖ and NEOS warn of over-subsidisation: if the uninsured are now compensated, more farmers might rely on state aid instead of insurance in the future.

Totschnig counters: without insurance there is no compensation for insurable risks. He talks about interest subsidies for operating loans, for example for buying seeds or feed. At the same time, he refuses to redirect the €50 million diesel tax relief for farmers (Agrardiesel) into drought aid — that would just be shifting money “from the left pocket to the right”.

Frequently asked questions

How big is the drought damage in Austria? According to Hagelversicherung, damage amounts to at least €1.08 billion — a record. All federal states and crops are affected.

How much does hail insurance cover? Around €400 million. 67 percent of farms are insured, covering 80 percent of arable land.

What does the ÖVP want? Minister Totschnig wants additional support for uninsured farms too, such as interest subsidies for operating loans. He refuses to redirect Agrardiesel money.

Why are SPÖ and NEOS holding back? Both point to the strained budget and demand targeted rather than blanket aid. A “whatever it costs” policy is ruled out.

What does the climate law have to do with it? SPÖ and NEOS link drought aid to the climate law that has been pending for years. Without progress on climate protection, there may be no deal on the aid package either.

What happens next

The FPÖ is increasing the pressure: party leader Herbert Kickl threatens a special session of the National Council if no finished aid package is in place by Sunday. Totschnig expects an agreement in the coming days. The ORF weather forecast could help: after a hot weekend, rain showers are expected nationwide from Monday.

For affected farmers, the situation remains tense for now. Watch whether the coalition actually passes the promised support for agriculture, and subscribe to our newsletter so you don’t miss any drought aid updates.