The European Commission has approved a €90 million Italian state aid scheme to foster primary agricultural production, processing and marketing of agricultural products.

The scheme aims to reorganise agricultural supply chains at a local level to create better market relations.

It is also hoping to improve the agricultural sector in terms of income, resilience, sustainability, and innovation.

According to the commission, the scheme will allow companies located in a certain geographical area, known as a "food district", to identify their needs and be supported based on a "district contract" with the Italian Ministry for Agriculture, Food Sovereignty and Forestry.

Under the measure, which will run until the end of 2029, the aid will take the form of direct grants and subsidised services.

In particular, it will provide support for investments, while allowing producers to participate in quality schemes, knowledge and information actions, advisory services, as well as cooperation and promotion measures.

The scheme is expected to benefit between 250 and 300 companies, the vast majority of which should be micro, small and medium-sized enterprises (SMEs).

Following an assessment, the commission found that the scheme is necessary and appropriate to encourage the relevant investments and actions to support companies active in the agricultural sector at a local level.

The commission also found that the scheme is proportionate as it is limited to the minimum necessary and will have a limited impact on competition and trade between EU member states.