engleski

The impact of CAP support on farm income and their long term sustainability

Farmers' income support is one of main goals of the EU Common Agricultural Policy (CAP). The most commonly used data set for evaluation of the importance of income support to farms is FADN. The FADN system has been established in Croatia in 2013 and there is a for year series of data available for analysis. Majority of analysesconducted on the FADN data base point to the great significance of the CAP support for Farms in the EU. According to available nformation, farm revenues would be 27% lower without CAP support, while for some farm types the CAP payments makes up to 50% of the total farm income. The FADN sample size in Croatia varies between 1290 and 1337 in the period 2014-2017. In the same period, total farm output value varies between 405 and 486 thousands of HRK. The average total utilized agricultural area per farm is 37.8 ha (2017). The proportion of subsidies (investment subsidies excluded!) in gross farm income (GFI) was the highest in 2014 (37.93%). In the next two years the proportion dropped sharply to 21.5%, so that in 2017 it would rise again above 30%. The lowest proportion of subsidies to GFI have farms of vegetables and ornamental production type (5.84%), while the highest is on farms breeding cattle, sheep or goats (39.21%). Regarding to the economic size, it is interesting that the biggest proportion of subsidies to GFI is on farms in class 7 (EUR 50000-100000: 36.69%). The proportion is lower as classes are getting smaller and larger, with exception of the largest class (14) where the average proportion is 33.07%. With respect to the region, the subsidies are more important to Continental farms (31.03% of GFI) than to Adriatic farms (21.34). The data presented clearly shows that the farms in Croatia are largely dependent on the subsidies, which means that their short-term sustainability, as well as the long-term development, would be brought into question in case of a significant reduction of subsidies.

gross farm income, CAP subsidies, FADN, farm types, farm size

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