Development of Organic Farming in Hungary by eqi10659

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									Development of Organic
  Farming in Hungary
       Gyöngyi Kürthy
  AKI (Research Institue for
   Agricultural Economics)
  Changes in the number of organic enterprises and the
        area of organic production in Hungary
                 between 1988 and 2004
          140 000                                                                                          1 600

          120 000                                                                                          1 400

                                                                                                           1 200
          100 000
                                                                                                           1 000




                                                                                                                   enterprise
           80 000
hectare




                                                                                                           800
           60 000
                                                                                                           600
           40 000
                                                                                                           400

           20 000                                                                                          200

               0                                                                                           0
                    1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

                                    Area of organic production   Number of organic enterprises
 Overview about present situation of
          OF in Hungary
 SWOT analysis:


           Strengths   Opportunities




         Weaknesses      Threats
                         Strenghts:
 OF strated in the 1980s
   – 1983 „Biokultura” Club
   – 1987 „Biokultura Associaton”, becoming member of IFOAM
   – 1991 „Biokultura Association” entitled to carry out controlling and
     certification activity
   – 1996: „Biokontroll Hungaria” separated from Biokultura Association
     and became the first, independent control body in Hungary
   – (2003: second control body was accepted: Hungaria Ökogarancia)
 Early adaptation of EU regulation about OF:
   – 1999/2000: two Decrees of Government came out about the
     conditions, controlling, labelling of organic products. The Decree
     was composed with the co-operation of Biokontroll, Biokultura in
     order to be in accordance with EU and IFOAM regulation
   – 2004: EU-accession: only smaller administrative changes were
     needed
                    Strenghts:
 Accepted controlling System:
  – Hungary was on the list of third countries allowed to
    export organic products to EU without further controlling
 Good ecological conditions
  – High yields, especially cereals, oilseeds
 Commercial connections
 Export possibilities
  – 90-95% of Hungarian organic products was exported to
    developed countries (EU, USA)
  The share of export from the organic production in
                   Hungary (2003)

                      Certified export
                     animal products:
                                         Certified domestic
                      230 tons (0,5%)
Certified domestic                       animal products:
 plant products:                           478 tons (1%)
9 312 tons (18%)




                                                          Certified export plant
                                                                products:
                                                           40 477 tons (80%)
Export ratio of the most important Hungarian organic
                    products (2003)

                     1 052
                             145
        Millet
                       3 065         438
German wheat
                        4 241                  1 822

Sunflower seed
                                   6 199                  762

         Corn
                                                           14 052                              932
       Wheat


                 0       2 000        4 000       6 000         8 000   10 000   12 000   14 000     16 000

                                                                tons

                                           Exported    Domestic Consumption
                  Weaknesses:
 Low domestic demand
 Wrong production structure
  – High rate of cereals, oilseeds, low rate of fruits,
    vegetables, animal products
 Processing of organic products is underdeveloped
 Low co-operation among organic farmers
 Bad experiences of implementation of EU organic
  payments (late payments, demonstrations…)
The production structure of the organic agricultural land
                      (1996-2004)

  2004                      46                             20                     15             8   4        6
  2003                  43                            22                  9            10        4       12
  2002                  41                            24                  8            10        5       12
  2001                 38                             30                      6        7         9        9
  2000                 38                             29                      6             15       5        6
  1999                  43                            23                  8                 18           5 4
  1998           30                             32                   10                     21            6 1
  1997             33                            29                  8                      23                6 1
  1996           30                        25                   8                      32                     41

     0%                20%              40%              60%                           80%                    100%
                                          organic land area
 Grassland   Cereals    Feeding crops      Industrial crops         Fruits, Vegetables, Grapes                    Others
Number of controlled enterprises in Hungary according
     to the type of their operation, (1998-2004)

                                                                                                     1583
1600
                                                                                      1443
1400                                                                 1320

1200
                                                       979
1000

 800                                   666

 600
       382          413
 400
                                                                                                            273
                                                                                             215
 200                                                         67 73          100 97             100
                                             41 55                                                                72
             17 2         25 37
   0
        1998         1999               2000             2001             2002         2003           2004


                                  Agricultural enterprises   Processors    T raders
               Opportunities:
 Easier export possibilities to EU-15 and and EU-
  10 countries (condition: good supply structure)
 Higher subsidies for organic farmers,
   OF becoming more important sector in agriculture
  due to WTO affairs, CAP Reforms
 Development of domestic food processing of
  organic products (condition: interest of the food
  industry)
               Organic payments in Hungary,
                        2002-2006
                                      Organic area and animal payments, 2002-2006 (EUR/ ha)
                                        2002                               2003                            2004-2006
                           in conversion       converted      in conversion       converted      in conversion     converted
Arable crops                           103                 62              99                 79             178               127
Meadows/pastures                       41                  33              40                 40             59                59
Permanent crops                       164                  82             159                 83            400                281
Vegetables                            123                  82             119                 83            329                202
Herbs/spices                          103                  62              99                 79            178                127

                                        0                   0               0       139 - 1 981               0                 0
Others (seed production)
Cattle                                  0                   0              40                 24             75                75
Pig                                     0                   0              10                  5             59                59
Sheep                                   0                   0               10                 5              19                19
Poultry                                 0                   0        0.16-1.19                 0               0                 0
Hen                                     0                   0                0                 0             0,5               0,5
Broiler/guimea fowl                     0                   0               0                  0             0,3               0,3
Goose and duck                          0                   0               0                  0             0,8               0,8
Turkey                                  0                   0               0                  0             1,1               1,1
             Opportunities:
 Increasing domestic demand (condition:
  higher income, better sales, marketing and
  information activity: ACTION PLAN)
 Good human resources (according to
  researches 80-90% of organic farmers has
  university/college diploma – MSc, BSc
  Degree)
                 Threats:
 Increasing competition in the international
  market of organic products (China, Eastern-
  European Countries, other new member
  countries with better OF policy…)
 Decreasing price premiums
 Increasing import of processed organic
  foods from EU-15 (Hungarian consumers
  becoming used to import products before
  development of domestic processing!)
                 Threats:
 Organic payments are no available for all
  the organic farmers: because of low
  financial resources Hungary uses an
  application system
 OF has no privilage in the Hungarian
  agricultural policy
         Future prospects?
 New National Rural Development
  Plan(2007-2013):

 Few is known at the moment as the amount
 of EU sources for member-states is still not
 decided
 Preliminary Strategy Plan for 2007-
                2013:
 Main Targets:
  – Increasing competitiveness of agricultural
    production and and food processing
  – Environment friendly development of
    agriculture, rationalizing of land management
  – Rural development
Preliminary diversification of national
              sources:
 Increasing of quality and value-adding in
  agriculture and food industry (30-35%)
 Rationalazing of land management with
  special regard to protection of environment
  and natural sources (40-45%)
 Diversification of rural activity, increasing of
  employment of rural population (25-30%)
 Development of local communities (2-5%)
 II. Axis: Development of rural areas
        and environment (45%)
 Development of forests (15%)
 Development of agricultural areas (85%):
  – LFA (high priority)
  – Agri-environmental measures (high priority)
  – NATURA 2000 and payments connected to
    2000/60/EC Directive
  – Animal welfare measures
  – Subsidies for non-production investments
Probable changes in OF Measures:

 Degressive payments
 Higher subsidies than integrated production
 Higher payments for fruit and vegetable
  production?
 Payments for animal production?
Thank you for your attention!

								
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