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Transcript of Jozsef Popp Director Research Institute for Agricultural Economics Budapest „Vision of long-term...
Jozsef Popp Jozsef Popp DirectorDirector
Research Institute for Agricultural Economics BudapestResearch Institute for Agricultural Economics Budapest
„„Vision of long-term agricultural and rural development Vision of long-term agricultural and rural development in the EU”in the EU”
May 25-26, 2006, PragueMay 25-26, 2006, Prague
„„Long-term scenarios of development from the Long-term scenarios of development from the Hungarian point of view”Hungarian point of view”
OutlineOutline
Agriculture’s place in the Hungarian Economy
Cereal production and consumption in Hungary
Development of livestock number in Hungary
Structural adjustment in the Hungarian agriculture
Concluding comments
Agriculture’s place in the Hungarian EconomyAgriculture’s place in the Hungarian Economy
19901990 19951995 20002000 20032003 20042004
Share of agriculture in the GDP (%)Share of agriculture in the GDP (%) 12,5 12,5 5,95,9 3,73,7 2,92,9 3,23,2
Share of agriculture in employment (%)Share of agriculture in employment (%) 17,0217,02 8,98,9 6,96,9 5,55,5 5,35,3
Share of agriculture in total investments (%)Share of agriculture in total investments (%) 8,78,7 2,92,9 2,72,7 6,2*6,2* 4,3*4,3*
HousHouseehold income spent on food (%)hold income spent on food (%) 37,037,0 28,428,4 29,229,2 2727 26,726,7
Share of agricultural and food products in Share of agricultural and food products in total exports (%)total exports (%)
24,924,9 22,722,7 8,08,0 6,56,5 6,06,0
Net foreign trades of agricultural and food Net foreign trades of agricultural and food products (billion HUF)products (billion HUF)
104,1104,1 246,6246,6 350,4350,4 303,1303,1 243,1243,1
SourceSource: Central Statistical Office, Hungary 200: Central Statistical Office, Hungary 20055
*Since 2002 together with agricultural investments of households*Since 2002 together with agricultural investments of households
010
0020
0030
0040
00
Mio
. EC
U, E
UR
Exports Imports Balance
Agricultural and food trade (1990-2005)Agricultural and food trade (1990-2005)
SourceSource: Research Institute for Agricultural Economics: Research Institute for Agricultural Economics Budapest, 2006 Budapest, 2006
Planned expenditure in Hungary for agriculture and rural Planned expenditure in Hungary for agriculture and rural development (2004-2006)development (2004-2006)
ExpenditureExpenditure Million EURMillion EUR Million HUFMillion HUF Allocation, %Allocation, %
EU (EMOGA + FIFG)EU (EMOGA + FIFG)
Direct payments (Guarantee)Direct payments (Guarantee) 1279,21279,2 326 196326 196 58,258,2
Rural Development (Guarantee)Rural Development (Guarantee) 602,3602,3 153 587153 587 27,427,4
Rural Development (Guidance+FIFG)Rural Development (Guidance+FIFG) 317,2317,2 80 88980 889 14,414,4
TotalTotal 2198,72198,7 560 671560 671 100,0100,0
National National
Direct payments (Guarantee)Direct payments (Guarantee) 1330,01330,0 339 155339 155 83,883,8
Rural Development (Guarantee)Rural Development (Guarantee) 150,6150,6 38 40038 400 9,59,5
Rural Development (Guidance)Rural Development (Guidance) 105,6105,6 26 93126 931 6,76,7
TotalTotal 1586,21586,2 404 486404 486 100,0100,0
Total (EU + national) Total (EU + national)
Direct payments (Guarantee)Direct payments (Guarantee) 2609,22609,2 665 351665 351 68,968,9
Rural Development (Guarantee)Rural Development (Guarantee) 752,9752,9 191 987191 987 19,919,9
Rural Development (Guidance)Rural Development (Guidance) 422,8422,8 107 819107 819 11,211,2
TotalTotal 3784,93784,9 965 157965 157 100,0100,0 SourceSource: Research Institute for Agricultural Economics: Research Institute for Agricultural Economics Budapest, 2006 Budapest, 2006
Planned expenditure in Hungary for agriculture andrural development (2007-2013)
0
100
200
300
400
500
600
700
800
900
1000
1100
1200
1300
2006 2007 2008 2009 2010 2011 2012 2013
mil
lion
€
Direct payment Rural development payment
Source: European Commission, 2006
CountryCountryReference Reference
yieldyield
t/hat/ha20042004 20052005 20062006 20072007 20082008 20092009 20102010 2011-20132011-2013
Czech Czech
RepublicRepublic4,204,20 145,7145,7 159,0159,0 172,2172,2 185,5185,5 212,0212,0 238,5238,5 265265 265265
HungaryHungary 4,734,73 149,5149,5 161,0161,0 174,3174,3 208,6208,6 238,4238,4 268,2268,2 298298 298298
PolandPoland 3,003,00 104,0104,0 113,4113,4 122,9122,9 132,3132,3 151,2151,2 170,1170,1 189189 189189
SlovakiaSlovakia 4,064,06 140,8140,8 153,6153,6 166,4166,4 179,2179,2 204,8204,8 230,4230,4 256256 256256
EU-10EU-10 4,00**4,00** 138,6138,6 151,2151,2 163,8163,8 176,4176,4 201,6201,6 226,8226,8 252252 252252
EU-15EU-15 4,774,77 300,5300,5 300,5300,5 300,5300,5 300,5300,5 300,5300,5 300,5300,5 300,5300,5 300,5300,5
EU-10/EU-10/
EU-15,%EU-15,%83,883,8 46,146,1 50,350,3 54,554,5 58,758,7 67,167,1 75,575,5 83,883,8 83,883,8
Area Payments granted for the EU-10Area Payments granted for the EU-10
SourceSource: DG AGRI, Country Reports: DG AGRI, Country Reports*CNDP: from the national budget*CNDP: from the national budget**Author’s estimate**Author’s estimate
[SAPS + CNDP*]/ha (in EUR/ha)[SAPS + CNDP*]/ha (in EUR/ha) EUR/ha
Production of major cereals in Hungary (1990-2005, with projections to 2010)
0
2
4
6
8
10
12
14
16
18
1990 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
mil
lion
tonn
es
Wheat Maize BarleySource: Hungarian Central Statistical Office and results of modelling work at the Research Institute for Agricultural Economics Budapest (Based on the assumption that the SPS is introduced in 2007)
Consumption and exports of wheatin Hungary (1990-2004)
0
1
2
3
4
5
6
7
8
1990 1995 2000 2001 2002 2003 2004
mil
lion
tonn
es
Feed Food industry Seed Exports
Source: Hungarian Central Statistical Office
Consumption and exports of maizein Hungary (1990-2004)
0
1
2
3
4
5
6
7
8
1990 1995 2000 2001 2002 2003 2004
mil
lion
tonn
es
Feed Food industry Seed Exports
Source: Hungarian Central Statistical Office
Development of pig numbers in Hungary (1990-2005, with projections to 2010)
Source: Hungarian Central Statistical Office and results of modelling work at the Research Institutefor Agricultural Economics Budapest (Based on the assumption that the SPS is introduced in 2007)
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
x 1,
000
Development of broiler production in Hungary (1990-2005, with projections to 2010)
Source: Hungarian Central Statistical Office and results of modelling work at the Research Institutefor Agricultural Economics Budapest (Based on the assumption that the SPS is introduced in 2007)
0
25
50
75
100
125
150
175
200
225
250
thou
sand
ton
nes
(liv
e w
eigh
t)
Development of intervention stocks in Hungary Development of intervention stocks in Hungary (April, 2006 and 2010)(April, 2006 and 2010)
SourceSource: Hungarian Central Statistical Office and results of modelling work at the Research Institute for Agricultural Economics: Hungarian Central Statistical Office and results of modelling work at the Research Institute for Agricultural Economics Budapest Budapest
4 664
1 678
110
14 815 14 709
10 968
0
2 000
4 000
6 000
8 000
10 000
12 000
14 000
16 000
April, 2006 2010-A 2010-B 2010-C
1000
ton
nes
Maize Wheat Barley Total intervention stock
A: A: Baseline Baseline (SPS (SPS from 2007)from 2007)
B: Intervention price B: Intervention price -10% from 2008-10% from 2008
C: No intervention C: No intervention from 2008from 2008
6 4556 455
Cost of shipping cereals by different transport modes Cost of shipping cereals by different transport modes from Hungary from Hungary to EU destinations/exits (2005)to EU destinations/exits (2005)
SourceSource: Research Institute for Agricultural Economics: Research Institute for Agricultural Economics Budapest, 2006 Budapest, 2006
SourceSource: Hungarian Central Statistical Office and results of modelling work at the Research : Hungarian Central Statistical Office and results of modelling work at the Research Institute for Agricultural EconomicsInstitute for Agricultural Economics (Based on the assumption that the SPS is introduced in 2007 (Based on the assumption that the SPS is introduced in 2007))
Implementation of SPS in Hungary: Implementation of SPS in Hungary: planned EU expenditure in Hungary (2010)planned EU expenditure in Hungary (2010)
Regionalised flat-rate SPSRegionalised flat-rate SPS
Coupled support:option
Crop-specific payment (non optional)
Far
m-s
peci
fic
top
up(h
isto
rica
l mod
el)
National reserve
Entitlements for new entrants
78,5%
0,3%
17,7%
16,8%
0,9%
3,5%
wheat29%
maize29%barley
8%
sunflower12%
other arable crops22%
Source: Results of modelling work at the Research Institute for Agricultural Economicsesults of modelling work at the Research Institute for Agricultural Economics Budapest Budapest
Production structure of arable land in Hungary (2004)Production structure of arable land in Hungary (2004)
Implementation of the SPS in Hungary: projected production structure of eligible arable land (2010)*
sunflower11%
barley5%
maize20%
wheat21%
arable land for alternative use
22%
mandatory set aside7%
other arable crops14%
*No intervention
New New mmodelsodels of of agricultural pagricultural productionroduction
Re-positioning agriculture in the knowledge economy
Old CAPOld CAP New CAPNew CAP
KNOWLEDGE FULCRUM
Environment Food Safety
Food Quality Nutrition
Disease and Welfare
Price Competitiveness
Price Competitiven
ess
? ?
Biotechnology?
WTO free trade: EU-high tech research programme
ConclusionsConclusionsProgress towards the market: reforms yet to comeProgress towards the market: reforms yet to come Decoupling is only partialDecoupling is only partial Set aside and milk quotas are still constraining those sectorsSet aside and milk quotas are still constraining those sectors The days of market intervention are numbered (under unchanged conditions, The days of market intervention are numbered (under unchanged conditions, 14 million tonnes of cereal stocks could be accumulated in Hungary by 2010)14 million tonnes of cereal stocks could be accumulated in Hungary by 2010) Budget pressures are tighteningBudget pressures are tightening Market pressures and opportunitiesMarket pressures and opportunities
Transition:Transition:
Important to have policies to facilitate adjustment of EU agricultural Important to have policies to facilitate adjustment of EU agricultural sector – competitiveness will be key sector – competitiveness will be key Key aspect is the re-skilling of labour (e.g. training for more market Key aspect is the re-skilling of labour (e.g. training for more market oriented producers) oriented producers) Set a realistic timetable for long-term objective so that the necessarySet a realistic timetable for long-term objective so that the necessary structural adjustment can be accomplished without unnecessarystructural adjustment can be accomplished without unnecessary disruptiondisruption