EVOLUTION OF ROMANIAN AGRICULTURE IN THE PERIOD 2007-2010

Carina DOBRE, Adina IORGA, Elena TOMA, Alexandra MUSCNESCU University of Agricultural Sciences and Veterinary Medicine Bucharest

Simpozionul International PERSPECTIVE ALE AGRICULTURII SI ZONELOR RURALE IN CONTEXTUL DEZVOLTARII DURABILE 17-18 Mai 2012 Bucuresti, Romania

Simpozionul International PERSPECTIVE ALE AGRICULTURII SI ZONELOR RURALE IN CONTEXTUL DEZVOLTARII DURABILE
17-18 Mai 2012 Bucuresti, Romania

EVOLUTION OF ROMANIAN AGRICULTURE IN THE PERIOD 2007-2010

Romanian agriculture in the pre-accession period diminished its contribution to the overall development of economy, showing a low economic efficiency and significant differences from the other member states. EU accession in 2007 started with great expectations in restructuring the sector by implementing the Common Agricultural Policy, aiming to be an integration and an appropriation to the European agricultural model, even in the economic crisis. Although without establishing a direct connection between the evolution of agriculture and the benefits of membership, this paper aims to observe how agriculture responded to political and economic changes in the period 2007-2011 and especially at how Romanian agriculture evolved after integration in the single European market.

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Agriculture global efficiency

Overall efficiency in the agricultural sector can be outlined by analyzing resulting indicators which are calculated by using the National Accounts NIS data, namely the value of production, gross added value and value of intermediate consumption. Estimated calculations for 2007-2009 (Table 1) reveal an improvement in agricultural efficiency shown by the declining share of intermediate consumption in production value, GVA growth in 1 Leu for intermediate consumption and GVA rate increase in production value as well as the increase of labor productivity in agriculture.
Table 1.Production, intermediate consumption and gross value added in Agriculture, hunting and forestry 2007 and 2010
Indicators MU 2007 2008 2009 2009/ 2007 111.9 106.6 118.3 -

Production Intermediate consumption Gross value added Share of intermediate consumption in total production value Share of Gross value added in total production value Gross value added reported on total Intermediate consumption Labor productivity, by employed person Employees Self-employed

Mill lei Mill lei Mill lei %

52935.1 28968.8 23966.3 54.7

67943.1 36300.6 31642.5 53.4

59245.7 30884.1 28361.6 52.1

% 45.3 % 82.7 lei/ person thou thou 87.2 91.8 46.6 47.9 -

8448.7 304.8 2531.9

11432.4 292.1 2475.7

10260.3 190.2 2574

121.4 62.4 101.7

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Agriculture global efficiency

In the period 2007-2010 the value in real terms of production increased to 11.8% mainly due to increase in value of crop production by over 25%, representing 67.5% of all Romanian agricultural production. Animal production value has been declining mainly due to reduction of livestock, while the agricultural services sector decreased considerably (over 30%).
Table 2. Agricultural branch production 2007 and 2010 (lei million constant prices) Indicators Total Crop production % Animal production 2007 47700 28723 60.2 18292 38.3 685 1.4 2010* 53348.9 35996.6 67.5 16891.2 31.7 461.0 0.9 %2010/2007 111.8 125.3 92.3 67.3 -

%
Agricultural services %

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Agricultural farms
Between 2002-2007 the number of farms under 5 ha fell by 568,400, but the reduction was insufficient and it was especially due to the physical disappearance of the owners and not as effect of surface concentration creating associative organization forms. Although after accession it was sought the further reducing in their number, the situation was reversed. Thus, the number of farms increased by 60,000, while farms with agricultural area between 5-50 ha decreased by 142 thousand, while those with more than 50 hectares increased by about 7000. If we follow the evolution of farms in parallel with the evolution of utilized agricultural area we emphasize the main causes of this situation the reunion of property and inheritance rights, the inclusion of agricultural land into commercial channels or lease / purchase of land by agricultural companies. The decrease in the number of farms and utilized agricultural area induced that in 2010 the average size of a holding to be of 3.45 ha. Thus, individual farms had in 2010 an average territorial size of 1.9 hectares, and units with legal personality had 188.8 hectares, i.e. 15% and 32.9% less than in 2007.
Table 3. Agricultural holdings 2007 and 2010
Indicators 2007 2010 Variation 2007-2010 -75 60 -142 7 -75 -89 14 -455 -1521 1066 98.60% 85.00% Holdings - thou 3931 3856 Table 3. Agricultural holdings Agricultural holdings with 3531 2007 and 2010 3591 agricultural area < 5 ha Share of total holdings 89.8 93.1 Agricultural holdings with 386 244 agricultural area 5-<50 ha Share of total holdings 9.8 6.3 Agricultural holdings with 14 21 agricultural area > = 50 ha Share of total holdings 0.4 0.5 Holdings - thou 3931 3856 - Single holder holding thou 3914 3825 - Legal entity or group holding 17 31 thou Utilized agricultural area (UAA) thou ha - Single holder holding - thou ha - Legal entity or group holding thou ha Average utilized agricultural area per holding ha/holding - Average utilized agricultural area per Single holder holding ha/holding - Average utilized agricultural area per Legal entity or group holding ha/holding 13753 8966 4787 3.5 2.3 13298 7445 5853 3.45 1.9

281.6

188.8

67.10%

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Cultivated area
Table 4. Agricultural cultivated area 2007 and 2010

The cultivated area increased in 2010 compared to 2007 by about 30 000 hectares, occupying about 83% of the country's arable land. An analysis of the cultivated area of 2010 reveals the following aspects: 64.6% is cultivated with cereals (27.7% to 26.9% with wheat and maize), 18.1% with oil plants (especially sunflower and rape), 10.9% with green fodder from arable land, 3.4% vegetables. Organic farming has a low importance, only 1.06% of the cultivated area is represented by the land cultivated in organic system. The largest increases were recorded for barley, canola, tobacco, medicinal and aromatic plants, in part because of the implemented subsidies system and agricultural policy. Due to the very good price for wheat in 2007, and also to the national grant, the area cultivated with wheat increased. Areas cultivated with wheat and corn, occupy over 50% even when declining by about 1% of the area planted with corn.

Indicators Arable area Cultivated area Organic crop converted area)

MU thou hectares thou hectares thou hectares % % % % % % % % % % % % % % % % % % % % thousand ha %

2007 9423.3 7777.2 84.6 66.0 25.4 4.7 32.5 0.6 4.1 3.4 0.4 17.4 17.2 10.7 4.7 1.7 0.2 0.0 0.1 3.3 9.9 2.4 2.0 1646.1 17.5

2010 9405.0 7807.4 82.9 64.6 27.7 6.6 26.9 0.5 3.6 3.1 0.3 18.3 18.1 10.1 6.9 0.8 0.3 0.0 0.2 3.4 10.9 2.3 1.86 1597.6 17.0

area

(fully

%2010/ 2007 99.8 100.4 98.1 98.3 109.5 141.8 83.1 86.0 88.2 90.0 76.7 105.6 105.2 94.6 147.2 48.0 154.1 136.4 214.9 103.7 110.8 94.3 92.8 97.1 -

Cereals for grains - Wheat - Barley and two-row barley - Maize grains Dried pulses Root crops - Potatoes - Sugar beet Industrial crops - Oilseed crops Sunflower Rape Soya beans - Other industrial crops Tobacco Medicinal and aromatic plants Vegetables Green fodder from arable land Bearing vineyards Fruit orchards Uncultivated area Share of uncultivated area in total arable area

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Livestock
In terms of livestock, except for goats and bee families, in the period under review, their decrease had continued. Bad weather conditions and increasing fodder prices led to massive slaughter of the animals. In several areas of Muntenia, Moldova and part of Transylvania, farmers were faced with selling their animals at a quarter of the normal market price, the most affected area is the south (Ialomita, Constanta, Dolj and Olt) where many producers with two or three cows sold their animals at extremely low prices, or in many cases they were killed. As a result, the breeding livestock (cows, buffaloes and heifers), decreased significantly with over 25%. Goat population has increased due to the support as complementary national direct payments (CNDP) and increasing interest for goat cheese dairy market.
Table 5. Livestock 2007 and 2010 %2010/ 2007 2007 2819 1732 6565 8469 865 862 82036 45208 982 21.4 75.7 70.9 2010 2001 1299 5428 8417 1241 611 80845 44504 1275 14.6 59.3 70.5 71.0 75.0 82.7 99.4 143.5 70.9 98.5 98.4 129.8 68.2 78.3 99.4

MU Cattle -Cows, buffalo cows and heifers Pigs Sheep Goats Horses Poultry -Adult laying poultry Bees Cattle Pigs Sheep and Goats thou heads thou heads thou heads thou heads thou heads thou heads thou heads thou heads thou families heads/100 ha heads/100 ha heads/100 ha

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Vegetal and animal production 2007 and 2010

MU 2007 2010 16712.9 5811.8 1311 9042 61.3 4121.8 3283.9 837.9 2402.1 2377.7 1262.9 943 149.9 24.4 3 15.8 3863.6 13016 740.1 1419.6 624.9 552.9 205 553 100 446 42824 6170 5951 22222 15184 % 2010/ 2007 213.9 190.9 246.7 234.6 169.3 92.4 88.5 111.9 227.3 227.2 230.9 260.9 110.1 244.0 272.7 544.8 124.0 136.3 84.8 130.7 167.7 116.3 61.6 86.1 90.9 107.2 78.0 100.0 95.6 132.5 100.5 Cereal for grains - Wheat - Barley and two-row barley - Maize grains Dried pulses Root crops - Potatoes - Sugar beet Vegetal production thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes thou tonnes Animal production thou tonnes thou tonnes thou tonnes thou hl thou hl mill pcs tonnes tonnes 7814.8 3044.5 531.4 3853.9 36.2 4461.2 3712.4 748.8 1056.6 1046.6 546.9 361.5 136.1 10 1.1 2.9 3116.8 9552.7 873.2 1085.8 372.6 475.4 333 642 110 416 54875 6173 6226 16767 15106

Table 6. Vegetal and animal production 2007 and 2010

Vegetable production in our country is heavily dependent on climatic conditions. This situation affects the comparison of 2010 to 2007 as cultivated land and production in 2007 were affected by drought. In this context, the natural conclusion of the analysis, namely the increased yield per hectare and total production for most crops (except potatoes and grapes) is inconclusive. Evolution of animal production on the other hand reveals a decrease in yield per animal, including goat herds where growth was above 43%.

Industrial crops - Oilseed crops Sunflower Rape Soya beans - Other industrial crops Tobacco Medicinal and aromatic plants Vegetables Green fodder Grapes Fruit - Plums - Apples Beef - live weight Pork- live weight Mutton and goat - live weight Poultry - live weight Cow and buffalo milk Sheep and goat milk Hen eggs Extracted honey Fish

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Workforce in agriculture
Table 7. Labour productivity in agriculture, forestry and fishing Indicators MU 2007 2010*

In the case of agriculture, employment continued to decline during 2007-2010, just as the civil population employed in agriculture (all persons who held an income generating social or economic activity in agriculture). On the merits of this decline, but also of production value growth there was seen an increase in labor productivity in the sector. Increased productivity is much lower if the value of production related to the population employed in agriculture according to agricultural censuses. It increased by over 10%, exceeding the year 2010 figure of 7.4 million people.

% 2010/ 2007

Production Value Civil employment Employees Persons occupied in agriculture**

Mill lei thou thou thou

47700 2465 125 6468

53348.9 2440 95 7159

111.8 98.9 76.0 110,7

Civil employment Employees Persons occupied in agriculture**

Labor productivity Lei/person 19343 Lei/person 381600 7375

21864 561567 7452

113.0 147.2 101,0

Lei/person

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Conclusions
ROMANIA'S AGRICULTURE AFTER JOINING THE EUROPEAN UNION HAS EVOLVED GENERALLY POSITIVE COMPARED TO 2007, ACTUALLY DUE TO IMPROVEMENT OF CLIMATIC CONDITIONS IN 2010 AND LESS TO THE INFLUENCE OF POLITICAL AND ECONOMIC ENVIRONMENT OF THE ANALYZED PERIOD. THUS, IN 2010 COMPARED TO 2007, LEADING INDICATORS HAVE EVOLVED AS FOLLOWS: - INCREASING LABOR PRODUCTIVITY BY 21.4% - THE LOSS OF AGRICULTURAL HOLDINGS BY 1.9% DECREASE AREA CULTIVATED WITH CEREALS, VINEYARDS AND ORCHARDS - AN INCREASE IN THE CULTIVATING AREA OF INDUSTRIAL PLANTS (ESPECIALLY HERBS AND AROMATIC PLANTS) AND VEGETABLES; - INCREASE OF CROP PRODUCTION (EXCLUDING POTATOES AND GRAPES); - DECREASE OF LIVESTOCK AND OBTAINED ANIMAL AGRICULTURAL PRODUCTION (EXCEPT FOR GOATS AND BEE FAMILIES).

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Thank you for your attention !

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