Hostname: page-component-78c5997874-lj6df Total loading time: 0 Render date: 2024-11-19T07:26:54.007Z Has data issue: false hasContentIssue false
  • English
  • Français

Financial relevance of organic farming payments for Western and Eastern European organic farms

Published online by Cambridge University Press:  25 February 2008

K. Zander ,
H. Nieberg  and
F. Offermann
K. Zander*
Affiliation:
University of Kassel, Faculty of Organic Agricultural Sciences, Department of Agricultural and Food Marketing, Steinstrasse 19, 37213 Witzenhausen, Germany.
H. Nieberg
Affiliation:
Federal Agricultural Research Centre, Institute of Farm Economics, Bundesallee 50, D-38116 Braunschweig, Germany.
F. Offermann
Affiliation:
Federal Agricultural Research Centre, Institute of Farm Economics, Bundesallee 50, D-38116 Braunschweig, Germany.
*
*Corresponding author: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

Organic farming in the European Union has been supported widely since 1994. Against the background of discussions concerning the design and level of organic farming support, and the relevance of organic payments for the economic success of organic farms, the question emerges as to the impact of support payments on the sustainable development of organic farming in Europe. Different databases and methodological approaches have been chosen to demonstrate the role of organic farming payments for the viability of organic farms for selected Western and Eastern European study countries. Economic analyses are based on national Farm Accountancy Data Network (FADN) in the Western European countries and on ‘typical farms’ in the Eastern European group. As a supplement to the modeling analyses, a detailed survey of 50 organic farms was carried out in each of the study countries. Organic farming payments were assessed to be ‘important’ or ‘very important’ to the economic situation on farms by the majority of the farmers surveyed. The outcome of the economic analyses shows that organic farming payments contribute on average 4–6% of gross output in the Western European countries and 4–19% in the Eastern European countries studied. The results put the level of specific support for organic farming into perspective, as other support payments and market returns contribute larger shares of total farm revenue in all the countries analyzed. Organic farming payments account for 10–30% of family farm income plus wages in Western European study countries and—after EU accession—up to three-quarters in some of the Eastern European countries, thus highlighting the considerable vulnerability of organic farms to changes in organic farming policy. As a general trend in both the West and the East, it can be observed that the policy dependency of farms has increased over recent years. Changes in organic area support, which are actually under discussion in some countries, must be carried out with a sense of proportion, since support payments will continue to play an important role in the profitability of organic farms. Nevertheless, in order to reduce dependency on area payments, organic farming support should follow an integrated approach, using a mix of support measures including, e.g., the improvement of processing and marketing facilities, support for farm cooperation and activities designed to enhance demand.

Keywords

farm economicsagricultural policyfinancial supportorganic farmingcompetitiveness
Type
Research Papers
Information
Renewable Agriculture and Food Systems , Volume 23 , Special Issue 1: Researching Sustainable Agricultural Systems, ISOFAR 2005 , March 2008 , pp. 53 - 61
Copyright
Copyright © Cambridge University Press 2008

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 Willer, H. and Yussefi, M. (eds) 2007. The World of Organic Agriculture—Statistics and Emerging Trends 2007. International Federation of Organic Agriculture Movements (IFOAM), DE-Bonn and Research Institute of Organic Agriculture, FiBL, CH-Frick.Google Scholar
2 Halberg, N., Alrøe, H.F., Knudsen, M.T., and Kristensen, E.S.(eds) 2006. Global Development of Organic Agriculture: Challenges and Prospects. CABI Publishing, Wallingford, UK.CrossRefGoogle Scholar
3 Hrabalova, A., Handlova, J., Koutna, K., and Zhadral, I. 2005. Final Report on the Development of Organic Farming in CEE Accession States with National Report Cards. Research Report D13 of the Project: Further development of Organic Farming Policy in Europe with Particular Emphasis on EU Enlargement. Brno. Internal Report.Google Scholar
4 Tuson, J. and Lampkin, N.H. 2006. D2 Report Detailing National and Regional Organic Farming Policy Measures in EU States and Switzerland. EUCEEOFP Project Deliverable to European Commission. University of Wales, Aberystwyth. Internal Report.Google Scholar
5 Nieberg, H. and Kuhnert, H. 2006. Förderung des ökologischen Landbaus in Deutschland: Stand, Entwicklung und internationale Perspektive. Sonderheft Landbauforschung Völkenrode, 295. Braunschweig.Google Scholar
6 Stolze, M., Stolz, H., and Schmid, O. 2007. Documentation about National Action Plans for Organic Food and Farming. EU Project ORGAP. Research Institute of Organic Agriculture, FiBL, CH-Frick. Available at Web site: http://www.orgap.org/documents/orgap_wp31_documentation_250107.pdf (verified 29 March 2007).Google Scholar
7 BMVEL (Federal Ministry of Consumer Protection, Nutrition and Agriculture) 2006. Organic Farming in Germany—as of September 2006. Available at Web site: http://www.bmelv.de/cln_044/nn_757134/EN/05-Agriculture/OrganicFarming2006.html__nnn=true (verified 13 January 2007).Google Scholar
8 European Union 2006. The Benefits of Organic Farming on Rural Development. European Union—Directorate-General for Agriculture and Rural Development, 2006. Available at Web site: http://ec.europa.eu/agriculture/qual/organic/ben/index_en.htm (verified 13 January 2007).Google Scholar
9 Häring, A., Dabbert, S., Offermann, F., and Nieberg, H. 2001. Benefits of organic farming for society. In Danish Ministry of Food, Agriculture and Fisheries (eds). Proceedings Organic Food and Farming: Towards Partnership and Action in Europe, 10–11 May 2001, Copenhagen Denmark. Danish Ministry of Food, Agriculture and Fisheries, Copenhagen. p. 80–88.Google Scholar
10 Dabbert, S., Häring, A.M., and Zanoli, R. 2003. Organic Farming: Policy and Prospects. Zed Books, London (UK).CrossRefGoogle Scholar
11 OECD (Organization for Economic Co-operation and Development). 2006. Producer and Consumer Support Estimates, OECD Database 1986–2005. Available at Web site: http://www.oecd.org. (verified March 2007).Google Scholar
12 Gay, S.H. and Offermann, F. 2006. Comparing support for organic and conventional farming in the European Union using an adjusted Producer Support Estimate. European Review of Agricultural Economics 33(1):31–48.CrossRefGoogle Scholar
13 European Commission 1999. EU Regulation 1257/1999 on Support for Rural Development. Available at Web site: http://www.europa.eu.int/comm/agriculture/rur/leg/1257_en.pdf (verified 13 January 2007).Google Scholar
14 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, Stuttgart.Google Scholar
15 Agribenchmark 2007. The Typical Farm Approach. Available at Web site: http://www.agribenchmark.org/methods_typical_farms.html (verified 13 January 2007).Google Scholar
16 Izquierdo Lopez, L., Davier, Z.V., and Deblitz, C. 2005. International competitiveness of organic beef production in Germany. Landbauforschung Völkenrode 55(2):127–135.Google Scholar
17 Nieberg, H., Offermann, F., and Zander, K. 2007. Organic Farms in a Changing Policy Environment: Impacts of Support Payments, EU Enlargement and Luxembourg reform. Organic Farming in Europe: Economics and Policy. Vol. 13. Stuttgart-Hohenheim, Stuttgart.Google Scholar
18 Gay, S.H., Osterburg, B., Baldock, D., and Zdanowicz, A. 2005. Recent Evolution of the EU Common Agricultural Policy (CAP): State of Play and Environmental Potential. MEACAP-WP6-D4b. Research Report. Available at Web site: http://www.ieep.eu/publications/pdfs/meacap/WP6/WP6D4B_CAP.pdf (verified 13 January 2007).Google Scholar
19 Friends of the Earth Europe 2004. EU Enlargement and Agriculture: Risks and Opportunities. Brussels. Available at Web site: http://www.foeeurope.org/publications/2004/Foee_Enlargement_Agriculture.pdf (verified 10 January 2007).Google Scholar
20 Popp, J. 2005. Agricultural markets in CEE—an overview. In Brosig, S., and Hockmann, H. (eds) How Effective is the Invisible Hand? Agricultural and Food Markets in Central and Eastern Europe. IAMO Forum, Halle (Saale). p. 3–21.Google Scholar
21 Stolze, M., Piorr, A., Häring, A., and Dabbert, S. 2000. The Environmental Impacts of Organic Farming in Europe. Organic Farming in Europe: Economics and Policy. Vol. 6. Stuttgart-Hohenheim, Stuttgart.Google Scholar
22 Mäder, P., Fliessbach, A., Dubois, D., Gunst, L., Fried, P., and Niggli, U. 2002. Soil Fertility and Biodiversity in Organic Farming. Science 296:1694–1697.CrossRefGoogle ScholarPubMed
23 Alfoeldi, T., Fliessbach, A., Geier, U., Kilcher, L., Niggli, U., Pfiffner, L., Stolze, M., and Willer, H. 2002. Organic agriculture and the environment. In El-Hage Scialabba, N. and Hattam, C. (eds) Organic Agriculture, Environment and Food Security. Chapter 2. Environment and Natural Resources. Series 4. Food and Agriculture Organisation of the United Nation (FAO), Rome. Available at Web site: http://www.fao.org/DOCREP/005/Y4137E/Y4137E00.htm (verified 29 March 2007).Google Scholar
24 Shepherd, M., Pearce, B., Cormack, B., Philipps, L., Cuttle, S., Bhogal, A., Costigan, P., and Unwin, R. 2003. An Assessment of the Environmental Impacts of Organic Farming. A Review for Defra-funded Project OF0405. Available at Web site: http://www.defra.gov.uk/farm/organic/policy/research/pdf/env-impacts2.pdf (verified 29 March 2007).Google Scholar
25 Hole, D.G., Perkins, A.J., Wilson, J.D., Alexander, I.H., Grice, P.V., and Evans, A.D. 2005. Does organic farming benefit biodiversity? Biological Conservation 122:113–130.CrossRefGoogle Scholar