Agri-food transformation.

The PERTE's three strategic focuses: competitiveness, digitisation and innovation

Through financing using European funds, the PERTE sets out to help to strengthen the food industry throughout the value chain, over the next decade, and support a sector that is tightly linked to the demographic challenge: the so-called "Empty Spain". This industry needs to become more competitive, be more sustainable and adapt to the demands of today's consumers, who demand more information about products reaching their tables.

In addition, the sector is behind the curve on implementing new technologies. The PERTE is built around 3 strategic focuses:

• Strengthening the industry with a focus on competitiveness, sustainability and food traceability and safety, with 400 million euros' worth of funding.
• Digitising all workers in the sector's value chain. With funding of 454.35 million euros.
• R+D+i. Support for technology research, innovation and technology transfers. With funding of 148.56 million euros.

The PERTE is being combined with other public-funding injections in the agri-food sector, which, according to the Spanish Government, total 50,000 million euros for the next five years, including the Common Agricultural Policy (CAP) and the European Maritime Fisheries and Aquaculture Fund.

A complex ecosystem, but full of opportunities for companies, which must be approached based around collaboration between companies and specialised advice, both when putting together the investment roadmap and in the administrative formalities. Therefore Bankinter, working hand in hand with the consulting firm FI Group, the leader in managing European funds, is supporting agri-food companies in this process.

Strategic focus 1: The major transformative investments for the industry

There are 400 million euros managed by the Ministry of Industry, Trade and Tourism and they look to improve competitiveness, sustainability and traceability throughout the value chain. This involves setting up consortia where producers, distributors, technology centers, universities and even technology start-ups get involved.

Son 400 millones de euros gestionados por el MICOTUR y que buscan mejorar la competitividad, sostenibilidad y la trazabilidad a lo largo de la cadena de valor. Hablamos de la constitución de consorcios en donde puedan estar presentes productores, distribuidores, centros tecnológicos, universidades y hasta start-ups tecnológicas.

The projects presented must respond to at least two out of these three objectives and must always comply with the third one: traceability and food safety.

The PERTE aims to support small and medium-sized companies, but just this strategic focus requires sufficiently strong leading companies that can head up these consortia. Some of its key focusses:

• The budget is limited, the calls will be published with a short submission deadline and there will be a lot of competition.
• Clusters and sector associations will play a significant role.
• Companies must come down clearly on their investments and choose their priorities: sustainability or digitisation.
• A road map of their own investments, with the main milestones to 3 years. This will help them to choose better.
• The PERTE is not exclusive: It can be used in conjunction with other opportunities, such as the CAP, and other PERTEs, such as energy.

These are the three main blocks for the call:

1. Competitiveness

Even though it allows participants to get involved individually, the philosophy of this PERTE encourages joint initiatives. Processes are improved by consortia, with a better contribution towards achieving the plan's objectives. Here are just some of the projects:

• Robotics.
• Sensorising processes and data collection.
• Artificial vision systems.
• Innovation in supply management and logistics.
• Artificial intelligence solutions.
• Optimising maintenance throughout the value chain for a product.

2. Committee

The fundamental objective of the European funds is embodied here in individual and joint actions that look for energy savings and reduce resource consumption. This involves using fewer raw materials, plastics and water, and new energies, such as biogas and photovoltaics. Here are some of the projects included:

• On-site energy savings and reduction of resource consumption.
• Renewable energy and self-consumption systems.
• Sustainable supply systems.
• Water reuse and purification systems.
• New materials and designs for packaging.
• Global commitments to reduce the environmental footprint of a product.

3. Traceability and food safety

It is a mandatory block in submitting any project and responds both to consumer demand for a complete labeling on a product (such as animal welfare and environmentally friendly production.), as well as the increasingly demanding requirements of national and European legislation. In these projects, it will be interesting to have partnership work with technology companies. It follows the guidelines of the Comprehensive Traceability and Food Safety Plan (PITSA) and is divided into 3 blocks:

• Implementing Blockchain technology for all phases of the project.
• Labelling and reading systems throughout the process.
• Designing monitoring and food safety systems.

Strategic focus 2: Digitising agriculture, fishing and cattle breeding

This investment, worth 454.3 million euros, sets out to support both digitising the sector and training staff in new technologies. The digitisation work covers all workers in the value chain, from primary production to transformation, marketing and distribution, from agricultural and livestock cooperatives to SMEs. Most of the budget is taken up by the so-called "Digital Kit".

Here are some of the digitisation and training projects that will be funded:

• A 100% non-repayable grant in the AEl-Agri fourth call for innovative projects within the National Rural Development Programme (PNDR). It is one of the major opportunities for this PERTE .
• PNDR grants to support digital training and advice in the agri-food sector.
• Digital Kit programme for digitising small businesses, micro-businesses and sole traders for eCommerce, social media or cybersecurity projects, for example.
• Creating digital-data cooperatives in trusted environments where partners share data obtained on their farm.
• Recruiting agents of change in SMEs, as digital transformation experts.
• Improving digital connectivity with ultra-fast fixed networks (Gigabit) and 5G technology.
• Training staff in companies, farmers' associations, farmers, ranchers and cooperatives, with a focus on young people and women in rural areas. It will be run by the Digital Skills Centre.
• Training for digital transformation experts in SMEs. Both employees and managers.

Strategic focus 3: Innovation which brings together companies, scientists and universities

R&D&i in the agri-food sector is crucial for achieving the objectives of this PERTE, which contains 148.56 million euros' worth of funding and covers modernising animal and plant health laboratories and support for the genebank platform.

Collaboration is being sought between private companies, research centres and universities, particularly through Missions for Science and Innovation, the item which receives the largest funding. It is built around around 5 programmes:

• Modernising animal and plant health laboratories. In particular, modernising animal health laboratories in Santa Fe (Granada) and Algete (Madrid), and opening a plant health laboratory in Lugo.
• Additional plans with the Autonomous Communities. In particular, in agri-food and marine sciences.
• Developing the Spanish Plant-Genebank Platform for Networked Agriculture and Food.
• Cutting-edge R&D projects focussing on society's challenges. Missions for Science and Innovation aimed at large strategic projects from business groups in collaboration with research organisations, technology centres and universities.
• Grants for Cervera Technological Centres of Excellence. Projects related to controlling of livestock pests and diseases, improving the safety and shelf life of food and developing healthier foods that prevent diseases.

Other additional measures: The CAP and the other PERTEs

The PERTE does not exclude the entire range of European and national grants already in place for the agri-food sector, in particular, the Common Agricultural Policy (CAP).

Companies must look more widely and decide which programmes best fit with their investments and milestones. It may be time to go for the PERTE, either individually or as part of a consortium, or you mat have to choose another initiative that better suits your interests. And see if the Agri-Food PERTE complements the CAP plans or even other PERTEs. Therefore, it is important to having specialised advice.

This is the case for investment grants for biogas, green hydrogen and solar self-consumption. These subsidies are already being rolled out in other PERTEs, such as the ERHA (Renewable Energies, Renewable Hydrogen and Storage) and the Circular Economy PERTES (which are notable for the sector because it covers investments in renewable packaging and plastic reduction).

Spain will receive 47.724 billion euros from the CAP for the period running between 2021-2027. This includes direct grants of 4.8 billion euros per year. The CAP now also focusses on the environment, which is why 40% of these funds are related to sustainability.

The six PERTEs that will channel European funds

In addition to the Agri-Food PERTE, the Government has so far approved another 5 PERTEs that will channel a lot of the Next Generation funds:

• Renewable Energies, Renewable Hydrogen and Storage (ERHA). Approved on 14 December 2021, with expected public investment of 6.92 billion euros.
• Electric and connected vehicles. The first, which was approved on 13 July 2021, was worth 4.3 billion euros.
• Cutting-edge healthcare. Approved on 30 November 2021, with investment of 1.469 billion euros.
• The circular economy. Approved on 8 February 2022, with public investment worth 492 million euros.
• New economy of language. The very last one. The Government approved it on 1 March 2022. It will receive a 1.1 billion public-funding injection.

And other PERTEs have been announced and are expected to be approved by the Council of Ministers throughout 2022:

• The social economy of care.
• The aerospace industry.
• The shipbuilding sector.
• Digitising water uses.

Spain is the eighth largest agri-food power in the world

The Spanish agri-food sector contributes 10% to the gross domestic product (GDP), worth 100 billion euros. It has an incredible export capacity: Our sales abroad are worth 53 billion euros a year (with two thirds sold to the EU) and have a positive trade balance of 18 billion euros.

Spain is the eighth largest agri-food power in the world, behind the United States, the Netherlands, Germany, Brazil, China, France and Canada. The situation in a country as small as the Netherlands, which is also the second largest exporter in the world, partly due to its logistics and port capacity, but also because of its commitment to innovation and sustainability is a quintessential model. Spain now wants to follow this path with the European funds.

In Spain, there are currently 1 million farms and almost 9,000 fishing vessels which catch 790,000 tonnes per year. The entire agri-food sector, as a whole, employs 2.3 million people. Thanks to these resources, Spain did not suffer any supply problems during the hardest periods of the pandemic and was able to keep its exports running at the same pace.

The world population will exceed 9 billion people in 2050, the deadline for hitting net zero. These 9 billion people will have to be fed using a lower number of cultivated hectares, which will also need to produce more produce. A more sustainable agriculture, fishing and cattle breeding in which Spain wants to continue leading the way.

Do you have an agri-food project?

• Contact your mentor if you have a project and want to know if you are eligible for aid under the PERTE. They will help you start the diagnostic process with FI Group.
• If you are not a customer, please contact us and we will be happy to help you.