UPDATE 1-Sarkozy open on farm budget if EU tougher on imports

* French President says farm imports must respect EU norms

* Eyes French-German proposals on EU farm regulation by Sept

* Unveils more loans for farmers in visit to Paris farm show

(Adds quotes, details)

By Gus Trompiz

PARIS, March 6 (Reuters) - France is ready to discuss a cut in Europe's farm budget in return for tougher conditions on imports in order to protect European produce, President Nicolas Sarkozy said on Saturday.

Sarkozy told a debate at the Paris farm show that France would be "supple" about the European Union's farm budget but "rigid" in its demand that agricultural imports respect the same standards as EU production.

Talks between the 27 EU member states are starting this year on the renewal of the bloc's sprawling farm policy for the period after 2013, and will pitch supporters of strong regulation like France against traditional adversaries like Britain that advocate a market-oriented approach.

"I am ready to accept reducing the share of agricultural spending in the EU budget provided that we use community preference," Sarkozy said, referring to the idea of favouring sanitary, social and environmental standards applied in Europe.

Such an approach was not contrary to international trade rules but rather ensured "fair competition", he said.

Sarkozy also reiterated calls by his agriculture minister, Bruno Le Maire, that European farm policy should include regulatory instruments to reduce price volatility, and allow farmers to negotiate collectively with retail customers.

A statement released separately by the president's office said Sarkozy would propose to German Chancellor Angela Merkel that their farm ministers issue joint proposals by September on regulatory tools for EU agriculture and how to finance them.

France would also advocate firmer regulation of agricultural markets when it assumes the presidency of the Group of 20 countries in November, Sarkozy told Saturday's debate.

CLOSELY WATCHED VISIT

The president's visit to the Paris farm show, a major landmark in the political calendar in Europe's biggest agricultural producer, had been keenly awaited by farmers disillusioned with falling revenues and irked that Sarkozy chose not to open the show as done previously by French presidents.

Sarkozy, whose first visit to the show as president in 2008 was marred by a spat with a member of the public, arrived earlier than planned, starting his obligatory walkabout before the visiting crowds emerged.

The French president showed much less gusto for tasting food and meeting the public than his predecessor Jacques Chirac, who visited the show on Friday, but Sarkozy's two-hour procession through the aisles passed off without incident.

Sarkozy used the debate with farm union officials to unveil additional support for farmers on top of 1.65 billion euros in aid and preferential loans announced in October.

The government would organise another 800 million euros in bank loans with subsidised interest rates, and go ahead with plans to exempt farmers from social charges on seasonal labour.

In a nod to farmers' discontent about new environmental standards adopted by France, the president also said the government would study their impact on farming, notably to see how they compared with measures in fellow EU countries.

Farm representatives welcomed the extra measures but said the real test would be a revival in farm prices and income.

"The best solution for this year is for market prices to recover," Jean-Michel Lemetayer, head of France's main farm union, the FNSEA, told the debate. (Additional reporting by Yann Le Guernigou; editing by James Jukwey)