you're reading...
PUBLICATIONS, Structural and Cohesion Policies

Future of small farms

Small farms have always been a cornerstone of agriculture in the EU. They play a significant role in supporting rural employment, contributing to territorial development. They are important for production, particularly in the form of local specialist products and provide important social, cultural and environmental services.

Future of small farms

© European Union

The last enlargements in 2004 and 2007 brought small and semi-subsistence farms into the EU, tripling their number. They populate rural areas, often the most fragile and disadvantaged regions; their integration with markets is low and their competitiveness has been questioned. Small farms are low cash incomes and a high incidence of poverty. (ENRD – small farms). The number of small farms in the EU is steadily declining as labour moves out of the agricultural sector making land available for consolidation.

There were 12.2 million farms across the EU. (Agriculture, forestry and fishery statistics, Eurostat, 2013). There is a lot of variation and big contrasts in farm structures across the EU: a large number (6 million) of very small farms (less than 2 ha in size) that farmed 2.5 % of the total land area used for farming and a small number (2.7 % of all holdings) of large farms (over 100 ha) that farmed 50.2 % of the farmland. This is also reflected in the economic size of holdings: there were 5.5 million holdings (44.6 %) which had a standard output below EUR 2 000. Many of farms, smaller than 2 ha, may be characterized as semi-subsistence farms, meaning that more than 50% of their output is self-consumed.

In the new reformed CAP direct payments are to be distributed in a fairer way between Member States, regions and farmers, putting an end to ‘historical references’. Any farmer claiming support may decide to participate in the Small Farmers Scheme and receive an annual payment fixed by the Member State of between 500 € and 1 250 € – this will be optional for MS. MS will also have the possibility to design thematic sub-programmes to pay small farmers business start-up aid up to €15 000 per within Rural Development measures. There will also be Rural Development funding for advice to small farmers for economic development and restructuring grants for regions with many such small farms. The new CAP will offer measures to facilitate collective investment, help small farms to develop and encourage transfers of agronomic know-how between farmers through a European Innovation Partnership in the farming sector.

On February 4, 2014 the EP plenary adopted the resolution, on the future of small agricultural holdings drafted by MEP Czesław Siekierski. In this resolution MEPs urge further to focus also on tools such as public funds for small farmers who often cannot access EU funding. Another suggestion is to establish some financial tools and involve regional or local authorities in providing such support. Smallholders should also enjoy free advisory services, more technical assistance. The Parliament is calling for infrastructure development to help boost direct farm sales, such as traditional products on local and regional markets; and help with developing processing capabilities.

Globally small-scale farmers produce over 70% of the world’s food needs. Contrary to the current perception, in nominal terms, the number of peasants and smallholders has increased (FAO). The year 2014 has been designated the ‘International Year of Family Farming‘ by the UN.

See also the EPRS Keysource on Local agriculture and short supply chains, July 2013.

Contents: Overviews – Analysis – Stakeholders views – Statistics – Related legislative procedure

Overviews

Common agricultural policy: the reform is approved by the Council / Brussels, 16 December 2013, Press release 17854/13 with annex of Main issues of the CAP reform, 11p.

The press release describes the new rules for the CAP 2014-2020. The regulation on direct payments contains support scheme for small farmers. Member States will have the possibility to increase the support received by smaller farmers by granting them a higher amount on the first hectares (‘redistributive payment’).

CAP and Rural Development Policy reform deal for 2014-2020: Toolkit for implementing key measures towards a greener, fairer, local and a smarter CAP at national/regional levels / ARC2020. 2nd version including some key Members States decisions/orientations, December 2013, 18p.

The updated version of the overview of the key measures for a fairer, a greener, a local and a smarter CAP. Not only does the toolkit list all the basic background details and all the up-to-date processes at EU level, individual MS and their interpretation of CAP reform are also highlighted – France, Germany, Poland, Spain, UK, Greece, Ireland.

Analysis

Family farming and the role of policy in the EU / Alan Matthews blog capreform.eu, November 27, 2013.

The author explains reasons for different perceptions of the position of family farms and discusses the role of policy in supporting family farms. The debates pivot around the distinction between family farms and small farms. The author concludes: “As we will see, all small farms are family farms, but not all family farms are small farms.”

Semi-subsistence farming: value and directions of development / Sophia Davidova et al. European Parliament, Policy Department B: Structural and Cohesion Policies. April 2013, 113p.

This study discusses current CAP measures and reform proposals for the post-2013 period with respect to EU semi-subsistence farms. The study assesses the values of SSFs for rural areas and the obstacles they face in using Pillar 1 and 2 measures. It concludes that the fundamental issue of income support to semi-subsistence producers is inadequately addressed by any set of CAP instruments, and puts forward a set of recommendations for strengthening the CAP approach, especially via Pillar 2, for SSFs.

What is a small farm? / European Commission, EU Agricultural Economic Brief No 2, July 2011, 11p.

The wide variation in farm structures across the EU-27 and the lack of consistent data for all Member States are amongst the main reasons why a commonly agreed definition of ‘small farms’ does not exist. The note briefly analyses possible criteria which could be used to define ‘small farms’.

Small Farms in the United States: Persistence Under Pressure / Hoppe, Robert A. et al. Economic Research Service/USDA, Economic information bulletin no. 63, 2010, 32p.

91% of U.S. farms are classified as small with gross cash farm income (GCFI) of less than $250,000. About 60 percent of these small farms are very small, generating GCFI of less than $10,000. These very small non commercial farms, in some respects, exist independently of the farm economy because their operators rely heavily on off-farm income. The remaining small farms – small commercial farms – account for most small-farm production. Overall farm production, however, continues to shift to larger operations, while the number of small commercial farms and their share of sales maintain a long-term decline. The shift to larger farms will continue to be gradual, because some small commercial farms are profitable and others are willing to accept losses.

Stakeholder views

Third international scientific conference: Social and economic problems of small agricultural holdings in Europe, 2013, Krakow, Poland

Social and economic problems of small agricultural holdings in Europe / Ministry of Agriculture and Rural Development, Krakow, Poland, 2013, 81p.

The proceedings of abstracts of papers presented at the conference 5-7 July 2013.

Conference “The Common Agricultural Policy towards small farms”, 2012, Krakow, Poland

Problems of Small Agricultural Holdings no 1, 2012 / Publishing House of the University of Agriculture in Krakow, Krakow, 2013, 162p.

Final report of the conference “The Common Agricultural Policy towards small farms”, Krakow, 6–7 July 2012.

Conference The Present and the Future of Small Farms in the European Union, 2011, Krakow, Poland

“The Present and the Future of Small Farms in the European Union” – a high level conference held on 8-9 July 2011 in Krakow, Poland, Conference summary.

Conference 2010, Sibiu, Romania

Semi-subsistence farming in Europe: Concepts and key issues” / Sophia Davidova, S. 2010, 97p.

Background paper prepared for the seminar “Semi-subsistence farming in the EU: Current situation and future prospects”, Sibiu, Romania, 21 – 23 April 2010. The seminar seeks to assess the current situation and policies affecting SSF in the EU-27, together with an overview of the challenges, needs and prospects faced by SSFs and their role in relation to rural environment and society.

Summary report of outcomes of the conference, 20p.

SEMI-SUBSISTENCE FARMING IN EUROPE: CONCEPTS AND KEY ISSUES Presentation of the backgroud paper / Davidova, S. Conference “Semi-subsistence farming in the EU”, 13-15 October 2010, Sibiu Romania

EU Rural Development Policy and semi-subsistence farming. What current RD tools are relevant for semi-subsistence farming and how are they being used? / Constantinou, A. DG AGRI, Conference “Semi-subsistence farming in the EU”, October 2010, Sibiu Romania

For more presentations click on the Documentation

Conference “Semi-subsistence farming in the EU”, 13-15 October 2010, Sibiu, Romania

Semi-subsistence farming in the EU: Current situation and future prospects / Davidova, S et al. ENRD. Background paper prepared for the conference “Semi-subsistence farming in the EU”, 13-15 October 2010, Sibiu Romania, 2010, 97p.

Further stakeholders:

Economic prospect for semi-subsistence farm households in EU New Member States / Jana Fritzsch et al. JRC IPTS, 2010, 324p.

The project focuses on agricultural holdings of very small economic size that market only part of their farm output. The results are based on a survey of SFHs in Poland, Romania and Bulgaria conducted in 2007. The main policy implications are that a one-size-fits-all approach is inappropriate and that a combination of sectoral and social policies is required.

Subsistence and Semi-subsistence Farming in Selected EU New Member States / Sophia Davidova, Lena Fredriksson and Alastair Bailey. University of Kent, School of Economics Discussion Papers. September 2009, 23p.

Subsistence and semi-subsistence farming is still wide-spread across the EU NMS. The analysis in this paper provides several conclusions that might inform policy. The value of income-in-kind is crucial for the rural poor, and particularly in the poorest of the EU NMS, Bulgaria and Romania. Policies strongly in favour of commercialisation might undermine the safety net provided by subsistence production.

Small Farms in the EU: How Small is Small? / Hubbard, Carmen, 111th EAAE-IAAE Seminar ‘Small Farms: Decline or Persistence’, June 2009, 13p.

This paper discusses and explores different approaches to the definition of small in relation to farms in the EU. It focuses on distributions of farms using different size criteria, making comparisons of the extent to which one criterion maps onto another.

Small Farms in Central and Eastern Europe: Is There a Future for Them? / Csaba Csaki, Cs, Forgacs, Cs. 111th EAAE-IAAE Seminar ‘Small Farms: Decline or Persistence’, June 2009, 26p.

Small farms in the CIS region represent a large and diverse segment of farms. A significant part of them do not have a long term future, Ssme of them will disappear or become a part time or hobby activity. About one third of them has the potential to grow and become linked to markets. The factor determining the chances for small farms is the status of overall economic policy and institutional environment. The policy makers have to be aware of specific difficulties of the small farmers and understand that targeted actions and helping small farms to develop and adjust to market conditions has to receive proper consideration in agrarian policy.

Origin Designation and Profitability for Small Wine Grape Growers: Evidence from a Comparative Study / Giuseppe Di Vita, Mario D’Amico. In: Economics of Agriculture, Vol 60, Number 1, 2013, 24p.

One of a very few studies which contribute to connecting the profitability of micro and small agro-food holdings in PDO (protected designation of origin) or PGI (protected geographical indication) areas with their ability to stay afloat in a competitive market.

International organisations’ views

FAO

Sustainable Agricultural Productivity Growth And Bridging The Gap For Small-Family Farms / FAO/OECD. 2012, 89p.

G20 leaders committed in 2011, to sustainably increase agricultural production and productivity. Mexico, as G20 President, invited international organisations to examine practical actions. This report, co-ordinated by the FAO and the OECD, responds to this request. The role of smallholder farmers and their families in increasing agricultural productivity growth sustainable will be crucial. The report gives 10 recommendations to G20 countries.

Coping with the food and agriculture challenge: smallholders’ agenda / Preparations and outcomes of the 2012 United Nations Conference on Sustainable Development (Rio+20) / Karla D. Maass Wolfenson, FAO. April 2013, revised July 2013.

The outcome document of Rio+20 includes several references to family farming and small-scale producers, recognizing their catalytic role in the improvement of rural livelihoods and their important contributions to sustainable development through activities that are both environmentally sound and sustain economic growth.

NGO views

European Coordination Via Campesina

Small farms and Short supply chains in the European Union, position paper by ECVC, April 2012.
In Europe, three million farms (20 %) have disappeared during the last eight years, mainly small farms. Small farms don’t present similar features everywhere: subsistence farms, small holdings as complement for other jobs, farms providing food for enlarged families, small units to produce-process-sell products to consumers in other places. The ECVC asks for the definition of small farms in every MS through 3 criteria: area, maximum number of employees/farmers and farm turnover. It also expresses the support for the label “product from my farm”.

Friends of Earth Europe

CAP reform: failure for environment and small farmers / FoE, July 2013,
Friends of the Earth Europe is critical of the several issues related to small farmers in particular:
The unfair distribution of subsidies, with the majority continuing to go to large farms. This will drive out small and family-sized farmers despite the redistribution of payments between countries and regions;
Positive approaches – the small farmers scheme – remain optional for member states.

more in: European farming reforms – too weak to support greener, fairer and local agriculture / FoEE, Briefing on the EU CAPolicy post 2013 deal, 26 June 2013, 7p.

IFOAM

IFOAM EU position on the organic regulation review / IFOAM, Brussels, 14/01/2014

The current legislative framework provides a basis for organic production and consumer confidence. Moreover its implementation potential is not yet fully exploited. IFOAM EU therefore recommends a focused improvement of the existing framework. Backed by the organic sector, IFOAM EU express the most important points of improvement to the current framework, amongst: enabling group certification for small farmers in Europe.

IFPRI

2012 Global Food Policy Report / IFPRI, 2012, 130p.

This 2012 Global Food Policy Report provides an in-depth look at major food policy developments and events. Access to capital and credit for smallholders is described as being a perennial problem, and magnified for young people. Various innovations to overcome the barriers and achieve sustainable outreach to smallholders have been developed, but the problem is far from solved, and risks and costs remain high. For African farmers to take advantage of the EU’s preferential treatment, they need better capacity to increase productivity and maintain food safety. The EU can provide assistance to make this possible.

National views (But: a document which describes or analyses the situation in one or different countries should go to the section Overviews (or Analysis).

Statistics

Agriculture, forestry and fishery statistics: 2013 edition / Eurostat, November 2013.

Chapter 2: The structure of agriculture in the EU: agricultural census 2010 (pages 21-33).

According to the Agricultural census 2010 (Eurostat, data from September 2013), “the distribution of the utilised agricultural area was not homogeneous within the UAA size classes. 49 % of the EU-27 smaller farms had less than 2 hectares and represented 2 % of the total UAA”. You can see also the paragraph 1.3 Structure of agricultural holdings on Agriculture statistics at regional level (Eurostat, data from February 2013).

How many people work in agriculture in the European Union? / European Commission, EU Agricultural Economics Briefs No 8, 2013, 17p.

This Brief presents the most recent data on agricultural employment in the European Union. The number of full-time farmers across the EU fell by over a third during the past decade, representing almost 5 million jobs, particularly in Member States such as Romania, Poland & Bulgaria, only Ireland bucking the trend. In the period 2000-2012, 4.8 million full-time jobs in the EU agriculture disappeared, 70% of them in the new MS and 93% corresponding to non-salaried workers.

Semi-subsistence farming: value and directions of development / Sophia Davidova et al. European Parliament, Policy Department B: Structural and Cohesion Policies. April 2013, 113p.

The study assesses the values of SSFs for rural areas and the obstacles they face in using Pillar 1 and 2 measures.
See statistical data in:
table 1: Numbers of small and semi-subsistence farms in the EU-27, MS sub-groups and individual MSs, 2010
table 2: Shares of semi-subsistence farms in the EU-27, MS sub-groups and individual MS, 2010
table 5: Numbers of all farms and farms smaller than 5 ha and 2 ha, EU and MS subgroups, 2003 and 2010
table 6: Average farm sizes by farm holder age in MS, 2010
table 11: Numbers of farms smaller than 2 ha and numbers of small direct payments beneficiaries by MS, 2010

Related legislative procedure

Future of small agricultural holdings, 2013/2096(INI), 15/1/2014, Rapporteur Andrzej Siekierski.

The Committee on Agriculture and Rural Development adopted on February 4, 2014, the own-initiative report by Czesław Adam SIEKIERSKI (EPP, PL) on the future of small agricultural holdings.

About EPRSauthor

European Parliamentary Research Service of the European Parliament. The EPRS offers the best available research and analytical support to Members of the European Parliament, their staff, parliamentary committees and, of course, to you!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

EU’s refugee crisis
EU Legislation in Progress
Topical Digests
EPRS Podcasts

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 1,986 other followers

Disclaimer and Copyright statement

The content of all documents (and articles) contained in this blog is the sole responsibility of the author and any opinions expressed therein do not necessarily represent the official position of the European Parliament. It is addressed to the Members and staff of the EP for their parliamentary work. Reproduction and translation for non-commercial purposes are authorised, provided the source is acknowledged and the European Parliament is given prior notice and sent a copy. Copyright © European Union, 2014. All rights reserved

%d bloggers like this: