The cereal harvest in Palencia is 40% lower than that of 2025, according to ASAJA Palencia. Soaring costs and extreme heat have resulted in losses even with CAP aid, prompting the organisation to demand a zero module in income tax for 2026.
The president of ASAJA Palencia, José Luis Marcos, has reported that the cereal harvest in the province is 40% lower than that of 2025. This decline, combined with skyrocketing production costs, leaves Palencia's cereal farmers with losses even after accounting for CAP (Common Agricultural Policy) aid. The organisation is calling for urgent measures, including the implementation of a zero module in income tax for cereals in 2026.
A harvest scorched by extreme heat
The 2026 cereal campaign in Palencia will not be remembered for the quality of the grain or the yields. According to data from the agricultural organisation, the extreme heat recorded in May and the early days of June literally scorched many fields: the plants did not complete their cycle and the grain did not fill out. The result is devastating: a production 40% lower than the previous year.
“After weeks of extreme heat in mid-May and early June, many fields have been scorched, dried out prematurely, without completing their cycle and without filling the grain,” summarises Marcos in a statement. The reduction in kilograms per hectare is so severe that, in many farms, the harvest barely covers the costs of the harvester.
Production costs that suffocate the farmer
In addition to the drop in harvest, there is a factor that turns it into ruin: production costs remain at unsustainable levels. Agricultural diesel —despite the truce in the conflict in Iran— is priced high, and fertilisers, pesticides, and seeds have not returned to pre-war prices in Ukraine. The equation is simple: the farmer pays more to produce and receives less when selling.
ASAJA Palencia has been warning about this for months. In 2025, with a record harvest in Castilla y León, producers managed to avoid losses thanks to CAP aid. “If the exceptional 2025 ended in balance, what can the farmer expect in 2026, with much lower production and even higher costs?” questions the organisation. This year, even with CAP aid, the Palencia cereal farmer is cultivating to lose money.
The Palencia cereal farmer is not asking for miracles: they are asking for fair prices, manageable costs, and an administration that understands that without farmers there is no food.
The tax demand: zero module in income tax
In light of this situation, ASAJA Palencia demands urgent measures. The main one is the implementation of a zero module in income tax for cereals in 2026. “The same tax burden cannot be demanded in a year of bankruptcy,” the organisation asserts. This measure would recognise that the activity does not generate profit and would prevent farmers from having to advance payments on an income tax for non-existent earnings.
Beyond the urgent fiscal need, the organisation points out another underlying problem: discouragement, the sale of land, and the lack of generational renewal. “Who is going to want to join a sector where working more means losing more?” they ask. The loss of young farmers accelerates the depopulation of rural areas and jeopardises food production in a province heavily reliant on cereals.
Producing at a loss is not an option: it is the chronicle of an announced abandonment if no measures are taken.
For readers interested in the agricultural sector, this situation serves as a warning: margins are tightening to the point that even European subsidies fail to ensure profitability. Palencia farmers need a quick response from the ministries of Finance and Agriculture to prevent a rural exodus that is already becoming noticeable. ASAJA Palencia is expecting an urgent meeting with both administrations to discuss the implementation of the zero module and other support measures.
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