The French government will donate “around 500 million euros” ($550 million) to help farmers cope with the estimated one to four billion euros of damage caused by the record-breaking hot spell, Agriculture Minister Herve Gaymard told reporters.
Gaymard said state aid would be limited as a result of external economic circumstances and tax cuts promised by President Jacques Chirac which have dented government coffers.
France slipped into recession in the second quarter of this year.
The measures "went in the right direction, even if we didn't get the 'White Year' we were asking for" - a reference to a demand for relief from all taxes for 2003, Jean-Michel Lemetayer of the National Federation of Farmers' Unions told AFP.
Under the aid package, farmers will be offered 20 million euros in direct assistance, cheap or zero-interest loans, certain tax breaks, and 24 million euros for the transport of desperately needed forage for livestock.
The government will also make a 180 million euro payment into a long-neglected rural disaster fund, Gaymard said.
"We have a high number of deaths among the cows, and milk production has dropped."
Although it had not rained for a number of weeks before the killer heatwave set in during the first half of August, temperatures which topped 40 degrees centigrade exacerbated its effect.
Crops wilted, millions of chickens died and livestock farmers used food stores intended for winter feeding.
“We have a high number of deaths among the cows, and milk production and the weight of the animals has dropped,” a local farmers' union leader, Tony Cornelissen, told AFP.
A contraction in France’s economy, tax cuts and this agricultural assistance package put Europe's third largest economy in danger of breaching a three-percent-of-GDP public deficit ceiling, imposed under the euro zone's rules, for the third year in a row.