White Paper on Agriculture: Subsidies, Irrigation and Financing - Farmers' Priorities

Increasing subsidies, developing the irrigation system, access to financing and amending the lease law are the main demands of farmers in our country, according to the White Paper on Agriculture 2024 document launched yesterday by the National Council of Small and Medium-sized Private Enterprises in Romania. The paper presents an assessment of the current state of agriculture and identifies the main challenges and opportunities for the coming years. The document focuses on the situation of agricultural SMEs, emphasizing development strategies, access to financing, human resources and market dynamics.

The research was attended by 560 entrepreneurs in the field of agriculture from the eight economic development regions of the country, who are faced with land fragmentation, lack of association in this field of activity, poor rural infrastructure, limited access to markets, insufficient financing, difficulty in accessing credit for small and medium-sized enterprises and the impact of climate change on agricultural land and production.

38% of the farmers who participated in the analysis stated that they want to increase subsidies granted to agriculture, 26.5% of the responses received consider the need to develop the irrigation system, and 24.75% aim to amend the lease law, while 24.25% are concerned about the consolidation of land or agricultural holdings. Related to this consolidation, only 13.75% of the farmers surveyed want to develop forms of association.

A sore point in agriculture in our country, according to data from the White Paper on Agriculture 2024, is the lack of financing or underfinancing of small and medium-sized farmers, given that the main way to finance the activity is self-financing mentioned by over 55% of respondents. 61.25% of them claim that investments are needed in machinery and equipment, and 33.5% believe that they need funds for farm management. 15.75% need funds to ensure the survival of the farm. Regarding the modernization of agriculture through digitalization and research and innovation, only 28.5% of farmers want investments for the digitalization of the business and only 11% need funds for research and innovation in this area.

Financing is necessary, because in recent years, farmers' production has been considerably affected by the impact of climate change taking place globally. 74.75% of the participants in the work prepared by CNIPMMR consider drought to be the main climate risk, 42% fear hail, while only 25.5% mentioned floods as a risk to agricultural crops.

In addition, 76.5% of farmers have problems covering the costs necessary to retain staff, 81% face difficulties covering the costs of buildings and other facilities, 85% complain about the lack of transport infrastructure in rural areas and the lack of necessary equipment and facilities.

Regarding the objectives of farmers for the next 3 years, 32.5% of respondents want to invest in activities that will directly contribute to increasing profits, 25.5% are oriented towards increasing investments, and 17.25% prefer to maintain the business at its current size. The main developments regarding salaries in the agricultural sector generally indicate a positive trend in the last 2 years: 50% of respondents indicating increases between 1% and 10%, while 15% indicated higher increases, between 11% and 20% of salaries, and 21% of respondents identified stagnation in this area.

We note that Romania is one of the countries with the largest agricultural area in the European Union, ranking 6th in terms of arable land, after France, Spain, Germany, Poland and Italy, and from an economic point of view, Romanian agriculture ranks 7th in the EU, with an estimated value in 2023 of approximately 22.2 billion euros according to Eurostat. According to data from the National Agency for Land Improvement (ANIF) and the National Institute of Statistics, our country has a potentially irrigable area of approximately 3 million hectares. In 2023, the irrigated area was around 600,000 - 700,000 hectares, according to official data.