Organic farming in selected CEEC after accession to the EU - different market scenarios and their impacts on the economic performance of organic farms

The adaptation of the European agricultural policy is associated with significant changes in support at farm level beginning in 2004 in most of the new member states (NMS). This may affect organic farms even more than conventional farms as agri-environmental policy is gaining weight compared to pre-accession. Some of the new member states even published organic farming action plans to foster the development of organic farming in their countries (Hrabalova et al. 2005). Although the action plans usually contain several tasks aiming at increasing the demand for organic products, area payments stimulating supply are the most important mean to support organic farms. Policy changes in combination with easier trade regimes in the enlarged European Union are supposed to change the situation on organic markets tremendously. The aim of this contribution is to analyse the economic consequences of EU accession for typical organic farms in selected new member states under different scenarios for future organic markets. National data bases for organic farms like FADN data is still scarce in most of the new member states. This is why the typical farm approach has been chosen for the analysis of the economic performance of organic farms in these countries (Häring 2003, IFCN 2005). The selected typical farm models represent most frequent farm types within their countries, so that it will become possible to draw a picture of the economic situation of organic farms in the selected countries before and after accession. Data base for the identification of typical farms were statistical data and expert knowledge. Depending on the structure of organic farming in the countries two to six typical organic farm models were set up in the Czech Republic, Estonia, Hungary, Poland and Slovenia. Data collection took place on real farms. The scientists always were accompanied by local experts on organic farming (e.g. advisors), so that farm specific data could be levelled out in such a way, that they represent the numbers of a group of farms. The different farm models mostly show a diversified production structure in all of the selected countries, although with a clear emphasis on crop, or on milk or on beef production. To cover possible future developments of organic farms in the enlarged European Union two very different market scenarios were defined. The first one is a quite optimistic one, which assumes a positive economic development at all levels of society. Domestic demand for organic products will increase, and only surpluses will be exported to the Western European countries. The second one is a scenario, where the economy in general shows a restrained development. Organic farming in the NMS evolves a supplier of raw products for Western European processors and consumers. The expansion of organic production - driven mainly by subsidies - in combination with low wages and production costs in organic production lead to a decline in prices for organic products. Based on the farm data collected for the year 2003 the farm level economic impacts of taking over common agricultural policy and of different market scenarios were calculated and discussed during workshops held in each of the study countries. Time horizon for the analysis is the year 2013 when the adoption of the CAP will be completed. Together with farmers and local experts likely adjustment strategies at farm level were elaborated. Modelling of these adjustment strategies is under way and in a final stage. Different types of support payments, and among these organic farming payments have been, depending on the country, of high importance for organic farms already before accession. Due to EU accession agricultural payment schemes changed completely. Farmers are offered payments from the 1st pillar of the CAP - although at a much lower level than in the former EU member states – and 2nd pillar payments, including all the agri-environmental measures. As a consequence agricultural payments in general and payments for organic farming increased significantly after the EU accession in all of the Central and Eastern European study countries. According to the participants of the workshops realized in all of the study countries higher subsidies are accompanied by an increase in bureaucracy, by additional needs for investments to comply with higher hygienic, agri-environmental and animal welfare standards and increased prices for inputs. Land markets were difficult before accession already, but the availability of land decreased and prices went up after accession. Payment schemes are perceived to be intransparent and lack of confidence in payments was stated hampering investment activities on the farms. But - in most of the study countries mentioned as a positive aspect - demand for organic products as well as knowledge concerning agri-environmental issues among farmers is growing. Farmers and advisors in all of the study countries see the development of domestic markets and particularly the setting up of processing and marketing facilities as the central issue for further development of organic farming in their country (see also Zakowska-Biemans 2005). Final results of modelling farmers adjustment strategies to changed policy and market conditions are almost completed and are expected for the month of February. The results will render information on the impacts of EU accession on the economic performance of organic farms, laying emphasis on adjustment reactions to different political and economic surroundings organic farmers might face in the near future. Literature IFCN (2005): International Farm Comparison Network, FAL, Braunschweig, www.ifcnnetwork.com, retrieved 11.4.05. Häring, A. M. (2003): An interactive approach to policy impact assessment for organic farms in Europe. Organic farming in Europe: Economics and Policy, Vol. 10, Stuttgart-Hohenheim. Nieberg, H., F. Offermann, K. Zander and P. Jägersberg (2005): Report on the farm level economic impacts of organic farming policy and Agenda 2000 implementation. Further development of organic farming policy in Europe with particular emphasis on EU enlargement (QLK5-2002-00917). Braunschweig. Hrabalova, A., J. Handlova, K. Koutna and I. Zdrahal (2005) Final report on the development of organic farming in CEE Accession states with national report cards. Further development of organic farming policy in Europe with particular emphasis on EU enlargement (QLK5-2002-00917). Draft version. Brno. Zakowska-Biemans, S. (2005): Organic markets in Central Eastern European new member states and accession countries. Further development of organic farming policy in Europe with particular emphasis on EU enlargement (QLK5-2002-00917). Draft version. Warsaw

EU-Beitritt und die wirtschaftlichen Folgen für Öko-Betriebe in den neuen Mitgliedsländern

The adaptation of the European agricultural policy began in 2004 in most of the new member states and is associated with significant changes in support at the farm level. Typical farm modelling showed that with the accession to the EU, the economic per-formance of organic farms in selected Eastern European study countries will improve largely until 2013. The increase in income is almost exclusively attributed to increasing payments. Modelling of different organic market scenarios shows that the marked increase in payments could also compensate for losses if organic markets would develop in an unfavourable manner. Thus, the economic success of organic farms in the selected new member states depends highly on the persistence of the newly introduced payments in the face of increasing production costs

Profitability and policy dependency of organic farms in selected European countries

This paper provides an analysis of the impact of support payments on the profitability of organic farms in Europe under changing policy environments, using different data bases and different methodologies. The analysis shows that organic farming has proven to be a financially attractive alternative to conventional farming for many farms in Europe. Organic farming payments are important for the economic situation in most European organic farms. In the public debate on the policy framework for organic farming, the emphasis is often on specific regulations and support programmes for organic farming. However, in the EU the general framework of the Common Agricultural Policy is one of the main determinants of the relative competitiveness of organic farming. The 2003 CAP reform will generally benefit organic farms in Denmark and, partly, Germany, while in Austria, in relative terms the CAP reform has a more negative / less beneficial effect on organic than comparable conventional farms. In the new member states, incomes in typical organic farms are projected to rise significantly following accession

Combining FADN and IFCN Data for Policy Impact Assessment - studied on the example of the EU Milk Market Policy

Eine wichtige Aufgabe der wissenschaftlichen Politikberatung besteht darin, mit Hilfe von Modellanalysen quantitativ abzuschätzen, wie sich agrarpolitische Reformen und sich ändernde Rahmenbedingungen auf landwirtschaftliche Betriebe auswirken und in welchem Umfang sich die Betriebe anpassen können. Bisher durchgeführte Analysen, die auf der einzelbetrieblichen Ebene ansetzen, basieren im Wesentlichen auf Buchführungsergebnissen des Informationsnetzes landwirtschaftlicher Buchführungen (INLB bzw. FADN) oder auf Daten von typischen Modellbetrieben aus dem International Farm Comparison Network (IFCN). Für kurzfristige Abschätzungen ohne nennenswerte Mengenänderungen bieten die FADN-Daten gute Voraussetzungen. Für differenziertere Analysen unter Berücksichtigung betrieblicher Anpassungen fehlt den FADN-Daten jedoch die erforderliche Datentiefe (vor allem das Mengengerüst und die verfahrensspezifische Kostenzuordnung). Die Stärken der typischen IFCN-Betriebe liegen aufgrund der Erfassungstiefe in der Ermittlung realitätsnaher betrieblicher Anpassungsreaktionen. Aufgrund der geringen Anzahl typischer Betriebe sind jedoch nur begrenzt Rückschlüsse auf Regions- bzw. Mitgliedsländerebene ableitbar. Ziel dieser Arbeit ist es daher, ein methodisches Konzept zur Verknüpfung der einzelbetrieblichen Datensätze FADN und IFCN für eine verbesserte Politikfolgenabschätzung zu entwickeln. Mittels Verknüpfung sollen die komparativen Vorzüge beider Datenquellen genutzt werden. Die empirische Analyse dieser Arbeit erfolgt am Beispiel der EU-Milchmarktpolitik. Der Verknüpfungsansatz "Einordnung" beinhaltet die Einordnung der im Berateransatz ausgewählten typischen IFCN-Betriebe in die durch FADN-Betriebe repräsentierte Grundgesamtheit. In der ersten Stufe werden IFCN- und FADN-Daten anhand struktureller Kennzahlen verglichen und die FADN-Betriebe ausgewählt, die den IFCN-Betrieben am ähnlichsten sind (Ähnlichkeitsmaß: Euklidische Distanz). Die Ergebnisse zeigen, dass, wenn das Ähnlichkeitsmaß sehr eng gefasst wird, nur ein relativ kleiner Anteil der Betriebe und der Milchproduktion aus der Grundgesamtheit repräsentiert wird. In der zweiten Stufe wird geprüft, wie die strukturell eingeordneten IFCN-Betriebe im Hinblick auf ihre wirtschaftliche Leistungsfähigkeit einzuschätzen sind. Dabei zeigt sich, dass nur ein Teil der typischen Betriebe als durchschnittlich leistungsstark eingestuft werden kann und deshalb die Analyseergebnisse dieser Betriebe nur Rückschlüsse für eine relativ kleine Betriebsgruppe aus der Grundgesamtheit zulassen. Letztendlich stellt sich die Frage, ob der FADN-Datensatz nicht schon besser bei der Auswahl der typischen Betriebe genutzt werden sollte, anstelle nachher festzustellen, wie repräsentativ die mit Hilfe von Beratern festgelegten typischen Betriebe tatsächlich sind. Deshalb wird ergänzend ein Verfahren entwickelt, wie die Auswahl typischer IFCN-Betriebe auf Basis statistischer Daten (FADN-Daten) erfolgen kann, um eine bessere Repräsentativität zu erhalten. Es werden deutsche Milchviehbetriebe aus dem FADN-Datensatz auf Basis von fünf Klassifizierungsmerkmalen nach dem Ward-Verfahren geklustert. Insgesamt werden 36 Cluster gebildet, aus denen abgeleitet werden kann, welche Strukturvorgaben für die typischen IFCN-Betriebe zu treffen sind. Es wird vorgeschlagen, anhand der Cluster mit den höchsten Produktionsanteilen mit Hilfe von Beratern zu einer Auswahl von Betrieben zu kommen, die die Regionen am besten charakterisieren. Beim Verknüpfungsansatz "Simulation" ist es das Ziel, eine größere Anzahl von FADN-Betrieben nutzbar zu machen für differenzierte Simulationsrechnungen im Modell TIPI-CAL unter Berücksichtigung betrieblicher Anpassungsreaktionen. Da die FADN-Daten primär zur Einkommensanalyse erhoben werden, müssen diejenigen Variablen, die im FADN nicht vorhanden sind, für Berechnungen im TIPI-CAL Modell ergänzt werden. Es werden zwei Politikszenarien und eine Anpassungsstrategie berechnet. Erwartungsgemäß zeigen die FADN-und IFCN-Betriebe ähnliche Einkommenseffekte und An-passungspotenziale. Es wird vorgeschlagen, die entwickelte Verknüpfung in ein Computerprogramm zu überführen, um ohne viel Aufwand eine größere Zahl von FADN-Betrieben analysieren zu können

Economic Impacts of the Adoption of the Common Agricultural Policy on Typical Organic Farms in Selected New Member States

Die Übernahme der Gemeinsamen Agrarpolitik in den neuen Mitgliedsländern im Jahr 2004 geht auch für ökologische Betriebe mit weit reichenden Änderungen der einzelbetrieblichen Förderung einher. Die Modellrechnungen zeigen, dass sich aufgrund deutlich steigender Förderprämien die wirtschaftliche Situation ökologischer Betriebe in ausgewählten Mittel- und Osteuropäischen Ländern bis 2013 erheblich verbessern wird. Dies kann neue und verbesserte Absatzmöglichkeiten auf europäischen Märkten eröffnen. Eine nachhaltige Entwicklung des ökologischen Landbaus in diesen Ländern erfordert jedoch dringend die Entwicklung von Verarbeitungs- und Vermarktungsstrukturen sowie einheimischer Märkte für ökologische Produkte

Analyse der Wirtschaftlichkeit der Kleingruppen- und Volierenhaltung bei Legehennen

Zusammenfassung Nach dem Verbot der konventionellen Käfighaltung in Deutschland stellte sich die Frage nach der Wirtschaftlichkeit von artgerechten alternativen Haltungssystemen. Über die Kleingruppenhaltung, welche relativ neu ist und wieder zur Debatte steht, liegen kaum praxisnahe Informationen vor. Diese Untersuchung konzentriert sich auf die Berechnung von Kosten und Erlösen und auf die Analyse ihrer Determinanten in Kleingruppensystemen und zu Bodenhaltungen (Volieren). Die empirische Basis bezieht sich auf eine Befragung von 65 Herden in Nord-, Mittel- und Süddeutschland (ein bis drei Herden pro Betrieb). Die Teilnahme an der Erhebung war freiwillig und an bestimmte Einschlusskriterien gebunden. Die Teilnahme von sehr großen Betrieben fiel gering aus. Die Kalkulationen zur Bewertung der Wirtschaftlichkeit beruhen auf einem Konzept der Deutschen Landwirtschafts-Gesellschaft. Bei beiden Haltungssystemen sinken die Produktionskosten mit zunehmender Herdengröße dank besserer biologischer Leistungen. In den untersuchten Kleingruppen ist mit steigender Herdengröße der Rückgang der Erlöse geringer ausgeprägt als der Rückgang der Kosten, so dass Saldo von Erlösen und Kosten zunimmt. Es wird deutlich, dass größere Herden wirtschaftliche Vorteile haben gegenüber kleineren Herden. Im Gegensatz zu den Kleingruppen sinkt bei den Volieren der Saldo von Erlösen und Kosten mit steigender Herdengröße. Der wirtschaftliche Erfolg betrieblichen Wachstums wirkt sich in den Kleingruppen deutlicher aus als in den Volieren.-------------------------------------------------------Summary After the ban on cages for laying hens the question on the economic efficiency of laying hens in welfare-friendly alternatives is raised. Limited information is available on the Small Group System, which is new and still under debate in Germany. This study focuses on the calculation of costs and returns and the analysis of their determinants in small group systems and in (multidaylight) floor-housing systems (aviaries) for laying hens. The empirical basis is a survey of 65 herds in northern, central and southern Germany (1-3 herds per farm) using a convenience sample. However, the participation of farms with very large herds was small. The calculation is based on a concept proposed by the German Agricultural Society. In both systems production costs decrease with increasing herd size due to improved biological performance. In small group systems the decline of the returns per egg with increasing herd size is less pronounced than the drop of the costs, so the margin of returns and costs increases. It becomes obvious that larger herds have economic advantages over small herds. In contrast to small group husbandry, in aviaries the margin of costs and returns declines with increasing herd size. This implies that an increase of size has more positive impacts on farms with small group systems than on farms with aviary systems

Why did the chicken cross the border? Assessing farm performance of broiler production in Ghana and Germany

Ghana has experienced an explosion in the consumption of chicken meat in the last two decades. However, local production has failed to keep up with the growing demand for poultry meat. Consequently, Ghana is highly dependent on frozen chicken imports as it imports an estimated 65 % of its total poultry meat supply. Ghana’s dependency on chicken imports is a subject of significant debate. One of the questions in the debate is: “How is it possible that EU countries are able to export frozen chicken meat to Ghana at such low prices and still make a profit?”. Some studies explain that EU countries like Germany are able to export frozen chicken cuts to African countries at low prices because EU consumers prefer to consume chicken breasts, therefore, other parts are either exported or processed into pet food. However, this explanation does not provide insights into why a significant amount of frozen whole chickens are also exported to West Africa at lower prices than the locally produced ones. Therefore, this means that there are other factors that contribute to the low-cost of frozen chicken meat exports from the EU. In this context, this study investigates whether the farm performance of German conventional broiler farms contributes to the low prices of German frozen chicken exports to Ghana. The typical farm approach was used to construct and quantify typical conventional broiler farms in Ghana and Germany. The approach entails the construction of empirically grounded farm data sets through the use of semi-structured interviews and focus groups. Our preliminary results show that the typical German conventional broiler farm is technically more efficient in comparison to the Ghanaian farms. The production costs in Germany are significantly lower compared to the Ghanaian farms. The results also show that all typical conventional broiler farms in Ghana and Germany are profitable in the short-term, which considers only cash costs

Why did the chicken cross the border? Assessing farm performance of broiler production in Ghana and Germany

Ghana has experienced an explosion in the consumption of chicken meat in the last two decades. However, local production has failed to keep up with the growing demand for poultry meat. Consequently, Ghana is highly dependent on frozen chicken imports as it imports an estimated 65 % of its total poultry meat supply. Ghana’s dependency on chicken imports is a subject of significant debate. One of the questions in the debate is: “How is it possible that EU countries are able to export frozen chicken meat to Ghana at such low prices and still make a profit?”. Some studies explain that EU countries like Germany are able to export frozen chicken cuts to African countries at low prices because EU consumers prefer to consume chicken breasts, therefore, other parts are either exported or processed into pet food. However, this explanation does not provide insights into why a significant amount of frozen whole chickens are also exported to West Africa at lower prices than the locally produced ones. Therefore, this means that there are other factors that contribute to the low-cost of frozen chicken meat exports from the EU. In this context, this study investigates whether the farm performance of German conventional broiler farms contributes to the low prices of German frozen chicken exports to Ghana. The typical farm approach was used to construct and quantify typical conventional broiler farms in Ghana and Germany. The approach entails the construction of empirically grounded farm data sets through the use of semi-structured interviews and focus groups. Our preliminary results show that the typical German conventional broiler farm is technically more efficient in comparison to the Ghanaian farms. The production costs in Germany are significantly lower compared to the Ghanaian farms. The results also show that all typical conventional broiler farms in Ghana and Germany are profitable in the short-term, which considers only cash costs

Animal welfare in broilers free-range and organic systems: economic implications at farm level

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