Agricultural Subsidies
Governments across 54 countries provide about USD 842 billion a year in support to agriculture, the OECD estimates. Most of it flows to individual farmers through market price support, direct payments and tax concessions, and much of that remains in the most production- and trade-distorting forms. A few countries even tax their farmers on balance, recording negative producer support.
Key Agricultural Subsidy Insights
Support hovers near record highs
Total support to agriculture across the OECD's 54 monitored economies averaged USD 842 billion per year in 2021-23. Emerging economies drove most of the rise, growing from USD 68 billion/yr in 2000-02 to nearly USD 500 billion/yr by the early 2020s.
Some countries support farmers far more than others
Producer support as a share of gross farm receipts (%PSE) tops 40% in Switzerland, Norway, Iceland and Korea and is about 38% in Japan, versus roughly 17% in the EU, 13% in China and just 8% in the United States.
Several countries tax their farmers
India, Argentina and Vietnam record negative producer support: policies hold domestic prices below world levels, implicitly taxing producers. India's %PSE runs around -11% to -15%, an implicit tax of over USD 100 billion in some years.
Most support distorts markets and the environment
About two-thirds of positive transfers to producers come through the most distorting forms—market price support, output payments and unconstrained input subsidies—while only a tiny fraction is tied to environmental public goods.
Total Agricultural Support by Economy
Annual support to agriculture concentrates in a few large economies. China, the United States, India and the European Union together account for roughly four-fifths of all support measured across the 54 monitored countries.
Key Finding: China alone provides about 37% of all monitored agricultural support—around USD 312 billion a year.
Producer Support as a Share of Farm Receipts (%PSE)
The %PSE expresses support to producers as a percentage of gross farm receipts, making countries comparable regardless of sector size. Values range from above 45% to negative, where farmers are taxed on balance.
Key Finding: Japan's %PSE (~38%) is roughly five times the US level (~8%), while India's is negative at about -13%.
Total Support to Agriculture Over Time
Total support has climbed steadily in nominal terms over two decades. OECD-country support grew modestly from a high base, while emerging economies' support rose more than sevenfold, reshaping the global picture.
Key Finding: Emerging economies went from USD 68 billion/yr (2000-02) to nearly USD 500 billion/yr, overtaking OECD members.
How Total Support Is Allocated
The Total Support Estimate splits into support to individual producers (the PSE), general services that benefit the whole sector such as research and infrastructure (GSSE), and consumer support (CSE).
Key Finding: Nearly three-quarters of all support goes directly to individual farmers; just 13.3% funds sector-wide general services.
Share of Producer Support That Distorts Markets
The OECD flags market price support, output payments and unconstrained variable-input subsidies as the potentially most production- and trade-distorting forms of support, with the largest spillovers to trade and the environment.
Key Finding: About 66% of positive transfers to producers still flow through the most distorting policy instruments.
Understanding Agricultural Subsidy Data
What the Producer Support Estimate (PSE) measures
The Producer Support Estimate (PSE) is the OECD's headline gauge of farm support: the annual monetary value of all transfers from consumers and taxpayers to agricultural producers, measured at the farm gate. The %PSE expresses this as a share of gross farm receipts (the total value of production plus budgetary support), so a 38% %PSE means support equals 38% of what farmers receive. Because it is a ratio, the %PSE allows comparison across countries of very different sizes. The broader Total Support Estimate (TSE) adds general services (GSSE) and consumer support (CSE) on top of the PSE.
Market price support versus payments
Support reaches farmers two ways. Market price support (MPS) is implicit—border measures such as tariffs and import quotas keep domestic prices above world prices, transferring money from consumers to producers without any budget outlay. Budgetary payments are explicit government spending: direct payments per hectare or animal, input subsidies, or revenue-based payments. The OECD classifies the most price- and output-linked instruments—MPS, output payments and unconstrained input subsidies—as potentially most production- and trade-distorting, because they tie support to how much a farmer produces.
Why some countries tax farmers (negative support)
Support can be negative. When a government suppresses domestic prices below world levels—through export restrictions, price controls or marketing rules—farmers receive less than they would in an open market, an implicit tax. In India, Argentina and Vietnam, this negative market price support outweighs positive subsidies, producing a negative %PSE (around -11% to -15% for India). The OECD treats these implicit taxes symmetrically to subsidies, so a country can simultaneously run large subsidy programmes and still tax its producers on balance.
Caveats and interpretation
PSE figures are indicators of policy effort, not actual cash payments: market price support is an estimate based on price gaps and can swing sharply with world prices and exchange rates, so year-to-year comparisons use multi-year averages. The estimates cover the 38 OECD countries plus 5 non-OECD EU states and 11 emerging economies—about 54 economies and most of world farm output, but not every country. Figures here reflect the OECD's 2024 monitoring (reference period 2021-23, with some indicators reported for 2022-24) and are nominal USD, so long-run rises partly reflect inflation.