European Union (EU) farm ministers worked overnight on Wednesday to seek an agreement on a major reform of the EU's controversial farm subsidies.

    As the closed-door talks were still going on, the farm ministers had to decide on whether to further break the link between farm subsidies and production and thus allow farmers to follow market signals to the greatest possible extent.

    While 90 percent of EU farm subsidies, which cost more than 40 billion euros (50 billion U.S. dollars) a year, are currently decoupled from production, the European Commission proposed in May to remove the remaining coupled payments, with only a few exceptions.

    Meanwhile, aid to farmers will be linked to the respect of environmental, animal welfare and food quality standards. Farmers who do not respect the rules face cuts in their support.

    Among a range of measures, EU farm ministers also need to agree on the abolition of arable set-aside and a gradual increase in milk quotas before they are abolished in 2015.

    The Commission already proposed last September for a temporary drop of EU rules requiring grain farmers to leave ten percent of their land uncultivated amid a bad harvest and higher food prices. This time, the set-aside requirement would be permanently discarded.

    France, which hold the EU rotating presidency, along with other major agricultural producers including Germany, Poland and Ireland, are reluctant to see a dramatic change of the current system, but EU Farm Commissioner Mariann Fischer Boel is pushing for further reforms.

    As EU farm ministers were gathering, almost 10,000 tobacco and farm workers held protests in Brussels against possible cut of the subsidies they could receive.

    The European Parliament called on Wednesday for a smaller cut in farm aid and a limited increase in milk quotas as well as a special aid for milk producers and livestock farmers.