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The impact of the “greening” of the common agricultural policy on the financial situation of Polish farms
49-55Views:286This paper presents an assessment of the impacts of introducing the greening scenario of the CAP, proposed by the European Commission as an alternative for the reformed CAP after 2013. In the past, the CAP has undergone numerous transformations in response to the changing macroeconomic environment and in reaction to developments in the farming sectors in EU countries. On the 12th of October 2011, the Commission presented a set of legal proposals designed to make the CAP a more effective policy to encourage more competitive and sustainable agriculture and vibrant rural areas. The proposal brings various new elements under consideration, some of them raising strong controversies such as introducing “greening” as a component of direct payments. Changes in the direct payments scheme in line with the EC proposition include forcing adjustments in the cropping pattern and creating ecological focus areas (EFA) on 7% of the farm land ; the consequences of such a proposal on the size and structure of agricultural production, and thus on the economic performance of farms and the whole agricultural sector are uncertain. The authors analyse historical changes to the CAP with a focus on a growing importance of the environmental component of the CAP, discuss different scenarios of shaping the direct payments system and present the results of modelling the impacts of greening the CAP on the Polish farming sector with the use of the LP optimisation model. The study was based on Polish FADN data. Results show that the majority of farmers in Poland comply with the crop diversification constraint of greening. However, establishing the required EFAs and necessary diversification on farms with simplified cropping structures will have a negative impact on the volume of agricultural production as well as on farm incomes.
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The influence of direct support under common agricultural policy on farm incomes in Poland
33-37Views:141The main objective of the paper is the analysis of changes on the level of income of agricultural producers, which took place in Poland in the early years of the accession to the EU, as well as a determination of the scale of the impact of financial support under the Common Agricultural Policy on the farm income situation. Poland’s membership in the EU gives rural farms opportunities to improve their economic situation. Financial aid, mainly in the form of a direct payment, has been the main factor determining the economical status of rural farms, whilst the other income making factors, such as improved productivity and increased agricultural production have played a much smaller role. The increase in revenue has enabled farmers not only to increase current expenditures, but also to carry out modernization efforts, which will determine the future economic and structural situation of the Polish agricultural sector and its competitiveness. However, a strong differentiation in terms of the economic situation of rural farms according to their size and specialization in production was also noticed. As a result, there is a still large number of farms in which the revenues received by farmers are insufficient to assure them adequate life standard. Therefore such farms are not able to both develop and invest. Only economically strong rural farms with high production potential have such opportunities, meaning that EU support will never be able to fully minimize the effects of small-scale production or to offset the insufficient efficiency and productivity of production factors.
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Agricultural policy and rural development
105-112Views:124The Common Agricultural Policy (CAP) is a cornerstone of EU policy relating to rural areas. Initially, it aimed to provide a harmonised framework for maintaining adequate supplies, increasing productivity and ensuring that both consumers and producers received a fair deal in the market. These priorities have shifted to environmental and animal welfare concerns, as well as food safety and security aspects. As a consequence, the CAP has gradually moved from a production-based structure of subsidies to a market-oriented system, integrating standards for food, environment and biodiversity, as well as animal welfare. In 2010, the EU launched an extensive debate on the future of the CAP, as the European Union needs a better tailored, reformed Common Agricultural Policy to answer the challenges of food, growth and jobs in rural areas. The European agriculture must address the expectations of rural society and demands of the market concerning public goods, the environment and climate change. This raises questions of whether the CAP payments in the past have been effective in achieving their objectives and whether direct payments should be continued for supporting agricultural environmental issues.
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Renewable energy resources in Hungary – solid biomass utilization in terms of necessity and opportunity
75-78Views:136In the 21st century a country’s success significantly depends on how it can solve the problems (supply safety, growing prices, climate change, etc.) induced by the application structure of the fossil energy sources with the means of energy saving, energy efficiency and the utilization of renewable energy resources. The utilization of renewable energy sources has positive effects on five key areas: environment protection, energy policies, fulfilment of EU expectations, agriculture and rural development and on the whole of the national economy. The bioenergy – beside fulfilling the national economic aims – it is putting up the value of the role of agriculture and rural development. The role of agriculture is multi-functional in the process. The agricultural sector has an important task in the area of bioenergy to ensure the proper quality and quantity of raw materials for the increase of bioenergy utilization. This also means new sales perspectives and opportunities for the producers. Above all this, the agricultural policy aims for the agriculture and the rural development segment to be the unambiguous winner of the new bioenergy sector and for most of the available profit to stay with the agricultural sector, with the rural players. For this reason encouraging the raw material production it wishes to encourage the producer their primary process and their local utilization. One of the fundamental objectives of the measures is that agriculture should go beyond the raw material production and take steps towards processing and utilization. The multifunctional role in the product chain might mean extra income and more added value for the producers and the active players in the process. The other objective is to promote the local utilization, the scatter of the environmentally friendly energy sources in rural areas, to change the energy is “lying on the ground unutilized” principle while local processing and promoting the utilization, to achieve a lower energy dependency and to optimize and disseminate cost efficient solutions. To realize all this means a great task and a huge challenge for the agricultural government as well as the rural societies and micro regions but might lead to a successful rural development. The range of the tools and measures to fulfil the aims might be very broad, from the regulating instruments to the various subsidies, coordination and dissemination tools. Part of the subsidy schemes are direct production-type of subsidies (the so called direct payments, for example the area based subsidies) and the other main forms are the investment-type subsidies which are for technology development, promotion of competitive production and local processing and for establishing a green energy industry. In the period of 2007-2013 the key elements of the development schemes were drafted in the frame of the New Hungary Rural Development Programme (ÚMVP) and the Environmental Energy Operational Program (KEOP). The available raw materials and the conditions are taken into consideration while designing the development schemes because a successful realization of a product chain means the assurance of the inputs and outputs. The starting point of determining the development direction is the principle of an operation which is sustainable and economical on the long run. In addition such developments are considered reasonable which are viable on medium and long term and bring numerous rural development, environmental and societal returns.
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