|
|
Production
Estimates and Crop Assessment Division |
|
|
Production
Estimates and Crop Assessment Division |
December 1, 2003
Polish Agriculture: Recent History
Land Changes and Reform
Communist Era
Farm Culture
Moving Towards the EU
Trends
Possible Outcomes
2003/04
Crop Conditions
Cropland
Some Possible Uses for Excess
Rye
Climatology and Geography
Field Size Comparisons
Field Pictures
Other USDA Tools on the
Internet
Earlier this year, a group from USDA’s Foreign Agricultural Service (FAS) traveled through Poland to assess the country’s 2003/04 crop and the situation and attitudes of Polish as EU accession nears. Several central European nations, including Poland, are well into the last year before formal integration into the European Union on May 1, 2004. The following report is based largely on observation during field travel and interviews conducted with various Polish agribusiness representatives while in Poland. Additional analysis from the Production Estimates and Crop Assessment Division (PECAD) is also included in the report.
Poland has the largest farm sector of the ten
acceding countries, with 1.9 million farms, averaging just six to eight
hectares each. In comparison, the average U.S. farm is 200 hectares, or about 25
times larger. The average EU farm is 18.4 hectares, but size varies widely, from 4.3
hectares in Greece to about 69 hectares in the United Kingdom. The vast majority--80
percent--of Polish farms are ten or fewer hectares. In addition to their
small size, farm efficiencies are further reduced by the fragmentation of owned
land. A typical farmer will have several (2–6) very small plots scattered
around the community.
Surprisingly,
the smallest farms represent just a minority of total farm area. While
the typical farm is very small, there are many larger farms, primarily in
the west, with sizes ranging from 30-100 hectares. Most farm area in Poland is
consolidated into larger operations of over ten hectares (58 percent of total
farm area). In all, the country has 14 million hectares of arable land or about
59 percent of Poland’s territory.
Poland’s population is approximately 38 million, of which 14 percent are
full-time farmers and another 5 percent are part-time farmers. Of the nearly
two million farms, no more than 800,000 produce commercially. Half of all farms
are subsistence operations, not selling any of their produce. Three-quarters provide no more than partial revenue to their owners. Most farmers obtain
additional income from full- and part-time jobs off the farm or from farm rent and
pensions. Income for EU farmers is approximately 15 times greater than that of
polish farmers. In total, agriculture contributes just 3-5 percent to the Polish
economy. The EU farmer’s income is composed of roughly 50 percent from subsidies, 20
percent from agriculture
production, and 30 percent from non-farm sources. Currently, almost half of the EU
budget goes for agriculture supports.
Polish Agriculture: Recent History
Polish farms have has a unique development in eastern and central Europe. Farm sizes within the country vary significantly, largely dependent on regional history. In general, farms in the north and west were influenced by Germany and Prussia, while farms in the east were influenced by the Austria-Hungarian style or the Russian agricultural model of small-scale family farms. Small-scale family farms also developed in the south of Poland. Today, land patterns remain largely the same: smaller in the south and east, larger to the north and west.
Until the 1920’s, Poland’s agrarian structure took the form of owner and peasant. Serfdom was finally abolished in the 19th century, but land ownership remained primarily with the upper class. The owner’s estates were usually between 100 to 500 hectares; peasant holdings were typically 2-15 hectares. In 1921, close to half the land was in holdings larger than 100 hectares. Some land reforms did come about in the early twentieth century; however, but only ten percent of arable land was distributed among hundreds of thousands of peasants. The greatest transformations occurred from World War II, which brought large-scale geographic shifts and a myriad of agricultural policy changes. The war created dramatic changes in population and land distributions. Many large tracts were left vacant in the formerly German-occupied north and west. In addition, land owned by Germans and military prisoners was confiscated. Any holding over 100 hectares was seized and dispersed to landless families. Almost 500,000 new farms were created from about half the country’s territory.
The result of land reform and the changes from the war was that Poland became awash with small and hence inefficient farms. A maximum 100 ha arable limit in the west and a maximum 50 ha arable limit in east was created.
There was a push to collectivize farms after the war. Farms
of 50 hectares and
larger in the east or 100 hectares or more in the west were socialized. In 1949,
any farmer who wanted to join a cooperative was given 7 hectares of land by the
government. Most farmers who joined the program were from the east and settled
in the newly acquired or recently abandoned land in the west. While the drive
to collectivize continued into the fifties, most of Poland’s land remained in
private hands, and remained so throughout the communist period. Cooperatives
never really took hold in Poland. Excessively large state farms were divided
and sold into smaller parcels. De-collectivization began in 1956. Despite
this, the state continued to maintain indirect control
over private farmers by controlling distribution of farm inputs. Farmers had a
difficult time getting access to machinery or other necessities without being in
a collective farm. Because of this coercive practice, private farms remained
small and labor- intensive.
Since larger farms were and still are located predominately in the west, there
is more investment in capital in the bigger western farms. In addition, because
of the high number of private farms existing in communist Poland, privatization
of agriculture was not a high priority in post-reform Poland. The country was
already more familiar with aspects of capitalism, albeit on a small scale, than
other former East Block countries. There is a slow trend toward farm
consolidation continuing, being promoted via varying methods, including early retirement,
but it is a slow transition.
Under the central economy over 70 percent of farmland was in private ownership
and management. Private farmers learned to be more efficient during the
communist system and Poland at that time did not face severe food shortages as
did other eastern Europe countries. Also private management was allowed to
develop significant fruit and vegetable production.
Poles have strong ties to the family farm and an attachment to land which has helped limit collectivization and nationalization of land to a level much less than had happened in most other eastern block countries after the World War II. About 25 percent of Poland’s workforce is employed in agriculture. This compares with just two percent in the United States. Poland’s central European neighbors, Hungary and the Czech Republic, are at 7 percent and 5 percent, respectively. Practically everyone in Poland has a relative in agriculture and the farming lobby has very strong political clout. Farmers are highly organized and capable of rousing public sentiment by staging protests and rallies. The small, self-sufficient farm with a traditional agriculture mix is inefficient but a highly valued icon in Poland and in central Europe. It is also too stubborn to disappear. Polish agriculture does not identify with large American-style farms specializing in growing just a couple crops.
Poland’s rural areas are over-populated. The rural
population is highest in the southeast; farming there is very inefficient
because of the high concentration of very small farms. The estimated break-even farm size in Poland is 30
hectares but over half of the farms are less than five hectares. To be
competitive in the European Union, these smaller farms need to be consolidated into at least 30 – 40
hectare operations. This will be a major undertaking. In addition to
the complication from very small, multiple location holdings, there is also
an abundance of leased land; the owners are reluctant to let go of their property.
One hectare of land qualifies the farmer for the pension fund. Some see this
payment as a “social rent” where the government takes from large operations to
subsidize small farms.
Rental land is usually not in the same local vicinity as the farmer’s own
parcel. He must travel to different locations reducing his time efficiency and
his ability to intensify and maximize capital improvements. Rental land can be
swapped for adjacent plots, reducing discontinuous checkerboard shape plots to
achieve more uniform areas. Poor quality land is currently over priced and may drop in
value when the new decoupled program takes into effect. Overall land prices
will also surely rise down the road when current EU members are allowed to
purchase real estate in the accession countries.
Polish agriculture is not geared toward intensive commercial production. The majority of farms are mixed production entities growing fodder for their own animals. They typically raise animals for profit and grow grains for subsistence. Polish yields can be ½ the EU’s amount but prices are at the same level. Many small farmers will not increase crop production because storage is the limiting factor. Excess on-site storage is rare. Large investments must be made because of outdated technologies. Owners however, wanting to modernize are hampered by a lack of capital. Small-scale farmers in particular, are using much less inputs than their western neighbors. Fertilizer use is very low, roughly half of what it was in the early nineties. In general though, inputs are easy to come by and are utilized on the large farms, but on small farms certified seed usage is low; Farmers often exchange seeds among themselves.
Poland, along with nine other central European, Baltic, and Mediterranean island
countries, will begin formal EU integration on May 1, 2004. There is a
period of eight years in which support for the accession countries will
gradually increase to full member amount in 2013. This issue remains under
debate and has become more controversial because of Polish concerns that Common Agricultural
Policy (CAP) reforms might negatively
affect its transition and competitiveness with current EU member states. Poland has opted for the direct payment
option; each farmer with one or more hectares of land will be subsidized
for growing supported crops (grains, rapeseed). An established level of 9.6
million tons will be supported at the negotiated rate of 3 tons per hectare. The amount Poland and other accession countries are supported during
the transition in 2004 is one quarter of the EU amount. During the first years of
transition, these countries are allowed to add to this amount. The Polish
government, like most of the countries has elected to “top up” or add to this amount by the maximum 30
percent, so
that farmers will receive the cap, or 55 percent of EU payments during the first year.
During the same time that the new countries payments are rising, the amount of
funding for the original countries will drop 3 percent each year until they both
reach 80 percent of current funding.
Most producers think area will likely increase for wheat, corn and
rapeseed. Production of feed grains by small farms could decline due to
more stringent regulations imposed by the European Union. The added cost in making changes
could well lead to more buying of off-site feed. This would also drive down the
number of small farms. Input costs are expected to either stabilize or rise
after accession. They are currently more expensive in the EU than in the
accession countries, but not by much. Additionally, input producers in Poland
are worried that they will be unable to compete with the modern factories and
systems of west Europe.
Most experts feel that within the first several years of EU integration, few
yield increases will be seen in the accession states. Unlike East Germany,
the new member states will be phased in gradually. They will not enjoy the full
economic benefits that was the catalyst for the high increase in East German
yields after re-unification. However, given a
longer time period, yields will approach those of neighboring western European
countries, as money, education and other variables reach an equilibrium.
Management issues will undoubtedly be some of the most difficult problems
for Poland and the former communist countries to overcome.
Ingrained business ideas, formed and nurtured during fifty years under a command
economy, will be difficult to rewire. Farm managers will need to apply a
market-oriented approach to agriculture, and to become more efficient. The past decade has
already seen significant changes since the economic
reforms began in the early nineties, but there is still a long way to go.
Management must continue to adapt, becoming more market-oriented, and
less political and favor-biased. Labor and business management decisions will
probably prove to be a considerable challenge.
Agricultural leaders in Poland
emphasize that technical aspects of farm management will readily be adjusted to
Polish farms during the transition period. Polish farmers are already highly
knowledgeable in farming techniques and all their basic practices are
applicable. Their skills need to be fine-tuned and adjusted for the newer and
different technology required for competitiveness in the European Union. This includes
understanding its regulations in order to be cross-compliant and hence eligible
for farm payments. Aspects of managing employees and making good business
decisions in a new, competitive environment will be difficult. Of course, these
issues present opportunities for current EU farmers to move east and become entrepreneurs,
providing assistance during the transition.
In general, the biggest farms will adapt more easily and quiclyr than smaller
farms. However, the largest farms will be losing financial support, as it is
gradually cut back for them in order to support a larger number of smaller
farmers. A universal problem in Poland and central Europe
accession countries is that infrastructure and agriculture equipment is largely
antiquated and must be modernized. The largest farms have already have mostly updated their equipment and are approaching
western standards. Farm operations under 10 hectares, however, will likely not
invest in the required, new and expensive technologies. This would surely
perpetuate the small Polish subsistence farm. The European Union hopes small
farms will naturally consolidate into larger operations from the market forces.
Meanwhile, financial assistance will become available for medium sized farms
(ones that occasionally or partially produce for market) to invest and grow.
Some producers believe that companies and farms that differentiate their products typically are and will be more successful than those producing standard commodities. Organic production opportunities are seen as possible options in marginal areas but they must be combined with good marketing strategy. Customers need to be familiar and aware of their benefits, and willing to pay a premium to get them.
Poland’s economy has struggled with unemployment hovering just below twenty percent. The cooperatives and state farms in Poland, as well as the rest of Eastern Europe has a history of over-employment. Since the early nineties, farming has consumed surplus labor from other sectors of the weakened economy, contributing to over-employment in agriculture. Meanwhile, after several downsizing attempts since reforms began, further adjustments still remain to be taken. The most successful entities will use fewer labor units. Unfortunately, there is still a lack of alternative employment for those currently in the swollen agriculture workforce. After years of a centrally planned economy, inefficiencies remain as marketing logistics are being developed, refined, and worked out. A complete retooling of Polish agriculture may only be accomplished after a new generation has taken over; One removed from the centrally planned approach.
Poland is a large producer of wheat, rye, triticale, mixed grains, barley, and corn.
Polish wheat production for 2003/04 is estimated at 8.2 million tons compared to 9.3
million last year. The autumn 2002 planted crop area in Poland, like the rest
of central Europe, is down significantly. The decline is largely attributed to
weather-related factors. The 2002/03 winter was the coldest in many years with
temperatures dropping well below normal, even below the safety threshold for
tender vegetation. The -20° to -25° Celsius temperatures created the worst
winterkill in years; this prolonged bitter cold was accompanied by little
or no protective snow cover. Spring planted crops, including spring wheat and
spring rapeseed, could at least partially compensate for winter losses. Poland
typically grows a significant amount (20 percent of its total) with spring planted
varieties of wheat, barley and rapeseed. Poland is estimated to harvest 2.0
million tons of corn (2.0 million last year.)
Dryness was less of a problem in northern sections of central Europe than
in the Balkans. During the 2003/04 year drought dropped yields for nearly all
agriculture crops. Dry southeast winds blew in from Ukraine depleting soils of
scarce moisture. Poland is in a good location for logistics, located next to
Germany and the Czech Republic
Wheat is by far the largest crop in Poland and certainly the biggest
producer in central Europe with an average harvest of 9.1 million tons. Wheat
production is limited mostly by the amount of quality arable land and is some
areas the regional dryness. A lot of concern was raised by the 3.0 tons per
hectare reference yield limit that the European Union has set up to be given to
Polish
farmers for wheat production. Many farmers said that their best lands can
attain 7.0 tons per hectare, but now all that will be paid is the reference
yield. It is feared that wheat quality will be lowered because of the lack of
incentives for premium wheat. Wheat is harvested typically in August, surplus
wheat is sold to the market.
Rapeseed is the only oilseed grown in the country. Production
has recently been hovering around 1 million tons but an unusually harsh 2003
winter has significantly reduced area and yields. Rapeseed plants can compensate
for the low number of plants emerging from a high winterkill session by
producing more branches. One farmer said that he doesn’t plow under and replant
unless the rapeseed was fifty or more percent destroyed by winterkill. Spring
wheat is the most common replacement for rapeseed. Rapeseed has a small planting
window (usually late August) but this can be expanded by using hybrid
varieties. These varieties give the farmer more time to bring in the summer
harvest and to prepare for autumn sowings. More EU varieties are now available;
however these species are much more susceptible to unusually cold weather, such as the
2003 winter, than are the native Polish varieties. The average amount of time
to develop a variety is ten years. If the sugar beet quota drops, sugar beet can
be substituted with rapeseed because the crop rotation requires that leafy plant
biomass in the rotation. Rapeseed is typically planted after every crop in
regions with poor soils to replenish nutrients. Rapeseed is expected to do well
with Poland’s integration into the European Union because there will be a minimum price for
rapeseed which does not currently exist in Poland. Increased demand of oilseeds
for biofuels could cause issues with food industry representatives because of
the higher demand, already negative opinions have surfaced. According to local
growers, rapeseed is often a competitor with rye. Rapeseed is said to
always be more profitable than rye on high-quality soils and often even on
marginal soils. Rapeseed is typically harvested in July. Sugar beet, and
rapeseed is limited to just ten percent in the crop rotation.
Corn production has increased dramatically in just a
few years. Current 2003/04 production is estimated at 1.9
million tons. The advent of shorter season varieties has resulted in the
northward march of corn production. While Poland now produces about 2
million tons of corn annually, the grain is wet at harvest (about 30 percent
moisture) and must
go through an expensive drying process. The capacity of drying facilities is
currently the limiting factor for increasing corn production. The corn
must be dried immediately in a very energy dependent process. Corn can be
sold to market for profit. Small farmers can go to a collection point that has
drying and short term storage. Meanwhile the collection point accumulates
marketable sized lots at these locations. A large silo manager said Polish
corn imports from the United States were as high as 3 million tons in the 1970's but have
steadily fallen to practically none today. Imports in the 1970's were largely
under food aid programs for Poland, which are no longer needed. Poland and
other central European suppliers have dramatically ramped up production, and
since 1997, US corn has been blocked from entry because of Poland's phytosanitary
weed seed (Ambrosia spp.) zero tolerance trade barrier.
Rye production for 2003/04 is estimated at 3.2 million tons. It is grown
extensively because its well suited for the expansive areas with light soils and
it can also stand up to a bitter winter. It is often used and will continue to
be used for cheap on-farm animal consumption. A significant amount is also used
and preferred in bread making by Polish consumers. Unfortunately for Polish
farmers however, after accession to the EU, rye will no longer be an intervention
product subsidized by the government. Overall production will most likely
decline but to a lesser extant than one would assume because few alternatives
exist to the hardy rye plant. Because of the crop’s traditional importance to
farming in Poland, serious efforts have gone into finding alternative uses for
rye but results have came up mostly empty. Apparently, most farmers who could
have gotten out of rye production already have. In addition to rye, triticale,
oats and mixed grains are also
grown extensively on the poorer soils in Poland.
Some Possible Uses for Excess Rye
natural starch
additive/binder for wood
adhesive/glue properties
heat production
biogas for energy
Starch can be used as an inefficient fuel (ethanol) but because of economic and technological restrictions the market would need to be established. However, ethanol can be produced in other countries such as Brazil at a cheaper cost.
Barley production in 2003/04 is estimate at 2.8 million tons. Poland grows mostly spring-seeded varieties. Often, spring barley is planted after a particularly cold winter has damaged fall-seeded crops. Brewing barley, a fraction of total barley, is largely grown under contract. Area sown under brewing barley is highly dependent upon price. The crop can bring in hard cash during the critical pre-harvest period when capital is low and most grains have not been harvested.
Political Poland: Administrative Boundaries (Vojvodinas)
Field Size Comparisons:
Larger Western Fields vs. Small
Eastern Fields
Image 1
Image 1
Image 2
Image 2
Poland is the largest accession country in both area and population. It
will be the fifth largest EU member state in area and population.
Soil conditions in Poland vary extensively across the country, but they get even
more complicated on a local level because high quality soils coexist adjacent to
poor quality soils. In general however, Polish soils are poor for agriculture.
Around seventy percent are often loose, light, sandy soils which dry rapidly in
times of little rainfall. Only one-quarter of the land is rated high quality
with much of that being concentrated in the southwest and to a lesser extent the
southeast. The most common soil type is of medium quality, not suited to wheat
production.
The climate of Poland is temperate, but it is more
continental and thus has more weather swings than the relatively moderate
climates of the EU countries to its west. The farther east and south into
Poland, the larger the temperature varies. Annual precipitation also fluctuates
within the country but is mostly between 500-750 millimeters (20-30 inches)
per year. The driest zone lies in a wide band across central Poland where
precipitation averages just 450-550 millimeters (18-22 inches). The
precipitation most suitable for agriculture falls along the southern border with
annual amounts of 600-700 millimeters (24-28 inches). Besides the lack of it,
another issue with the country’s annual rainfall is its bad timing. Rainfall is
minimal during the early growing season (April through June) and typically wet
during much of the harvests in July and August.
Poland
is largely part of the North European Plain in the north and consists of small
hills in the south. Mountains cover only a small border region of Poland in its
extreme south. A marshy area known as the Lake District in the north of the
country has much wooded parkland but relatively fewer farms.
|
Crops: |
Various Farm Pictures: |
|
Small
farms being worked |
|
Cited or Relevant Bibliography
Attaché Reports from staff at international postings can be viewed. from
this website.
For crop conditions and weather data in Europe and throughout the world, visit Crop Explorer.
For official USDA data on production, supply, and
distribution of agricultural commodities in Europe and the rest of the world,
please visit
PS&D Online.
