Post on 28-Dec-2015
Factors contributing to the resilience of subsistence and semi-subsistence farms:
evidence from Greece
Pavlos KaranikolasAssistant ProfessorAUA, Dept. of Agr. Economics & Rural Development
May 4-8, 2014, Montpellier, France
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Presentation Outline
1. Informal food networks in Greece
2. The incidence of subsistence (SFs) and semi-subsistence farms (SSFs) in Greece
3. Farm-level data from a local field survey
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
1. Informal food networks in Greece
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Type of Network (An initial mapping) Broader Athens
The rest of Greece
1 Organized Direct Sales 39 76
2 Food Networks Without intermediaries 64 101
3 Urban vegetable gardens 63 84
4 Social Groceries 66 102
5 Agricultural Cooperatives [new type co-ops]
34
6 Recycling – Re-use of Food 9 4
Source: www.enallaktikos.gr, April 2014
In response to the crisis, since 2011:
2. How many Subsistence & Semi-Subsistence farms in Greece?
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Farm Structure, 2010
Source: Eurostat, Farm Structure Survey, 2010
Size Class (Ha)
Farms
Number %
0 6.180 0,9%1-1,9 367.160 50,8%
2,1-4,9 183.820 25,4%
5,0-9,9 87.770 12,1%10,0-19,9 45.580 6,3%20,0-29,9 14.670 2,0%30,0-49,9 10.850 1,5%50,0-99,9 5.480 0,8%100,0+ 1.500 0,2%
Total 723.010 100,0%
77% of farms, under 5 Ha
Average Farm Size: 4,8 Ha
Economic Size: 33% of farms with Standard Output less than 2000 €
In 16,4% of farms:More than half of production is self-consumed by the holder
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Year 1 2 3 4 5 6Farm
HouseholdsNon-Farm
Households with some income +
subsidies from agriculture
Non-Farm Households with some subsidies
from agriculture
Retired Farm
Households
Non-Farm Households
with agr. production
for self-consumption
Non-Farm Households
Total
Some agricultural production for self-consumption
2009154.331
3,8%
299.196
7,3%
88.228
2,1%
230.709
5,6%
1.150.227
28,0%
2.191.460
53,3%
4.114.151
100%
2012166.947
4,0%
236.946
5,7%
60.098
1,4%
251.604
6,0%
1.178.001
28,3%
2.269.640
54,5%
4.163.236
100%
2009-2012+12.616 -62.250 -28.130 20.895 +27.774 78.180 49.085
A detailed typology of All Greek Households:
Source: Household Budget Surveys, Elaborated Data
Poverty Rates (% in each category)
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Source: Household Budget Surveys, Elaborated Data
Farm Households Non-Farm House-holds with some
income + subsidies from agriculture
Non-Farm Households with some subsidies
from agriculture
Retired Farm Households
Non-Farm Households with agr. production
for self-consump-tion
Non-Farm Households
Total0%
10%
20%
30%
40%
50%
60%
70%
80%
18% 20%
28%
70%
16% 16%20%
30%
19%
34%
55%
19% 18%21%
2009 2012
Agricultural Self-Consumption: mitigates poverty rates
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Source: Household Budget Surveys, Elaborated Data
Farm Households Non-Farm House-holds with some
income + subsidies from agriculture
Non-Farm Households with some subsidies
from agriculture
Retired Farm Households
Non-Farm House-holds with agr.
production for self-consumption
Non-Farm Households
Total0%
10%
20%
30%
40%
50%
60%
30%
19%
34%
55%
19% 18%21%
24%
11%
17%
42%
11%15%
Without agricultural self-consumptionWith agricultural self-consumption
2012, Poverty Rates
3. A Field Survey in Municipality of Ancient Epidaurus
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
• Detailed farm-level data in 2006
• historical data (1950’s-2006)
• A follow-up survey in 2011
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
• Population: 1733 inhabitants
• Average farm size: 2,4 ha
• Total number of farms/farm households: 410
• Our representative sample:
70 farms
The local agro-system and rural economy
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Dimensions
1950’s-1960’s 1970’s-2000’s
Technical
• Inadequate Infrastructures • Traditional farming techniques and methods of production
• Improved infrastructures• Farm modernization • The productive system has changed: Tree Cultivations for: Olive Oil [dry & irrigated], Oranges, Mandarins Small vegetable gardens for self- consumption
Social • no co-operation among farmers
• no co-operation among farmers
Economic
• Farms producing mainly olive oil, vegetables and some animal products for self-consumption• small quantities of oranges for sale • fishing
• After the initiation of the Annual Cultural Festival at the Ancient Theatre, the area became a popular tourist destination• the driving force for the local economy is services for tourists • the local farm products are sold:
in Athens, directly from the famers in Athens and elsewhere, through informal family
networks through commercial networks
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
How many SFs and SSFs in this area?
1. All farms have a market participation rate >= 50% [None SF or SSF]
2. Four farms (5,7%) have an economic size < 1 ESU
3. Sixty-five farms (93%) with Utilized Agr. Area =< 5 ha,
therefore we use the 3rd criterion to distinguish
semi-subsistence farms
Let’s focus on these 65 ‘semi-subsistence’ farms:
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
These Farms/Farm Households follow various Livelihood Strategies:
Changes in UAA over time (ha) [1950's -
2006]
Number of Farms
Hired Labour/ Total Labour
Direct Marketing of farm products
(hours per farm per year)
Diversification Off-farm employment of household members
(hours per household per year)
Enlargement 10 56% 471 1 farm converted to organic in 2000 3084
Contraction 12 42% 5672 farms converted to organic (2000, 2002) 1 with hotel (in 1975) 1 with tavern (in 2000)
3029
No change 43 56% 833 with Rooms to Rent (1990, 1996, 2001) 2 with Taverns (1995, 1999) 2 with Hotels (1982, 1992) 1 with Restaurant (1975)
4438
………………
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
0 1000 2000 3000 4000 5000 6000 7000 8000 90000
2
4
6
8
10
12
14
16
18
Olive Oil, Dry Cultivation,Average Total Cost (€/Kg)
Eu-ros/Kg
Production per Farm (Kg)
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 100000
1
2
3
4
5
6
7
8
9
10
Olive Oil, Irrigated Cultivation,Average Total Cost (€/Kg)
Euros/Kg
Production per Farm (Kg)
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Euros/Kg
Production per Farm (Kg)
0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,0000.0
0.2
0.4
0.6
0.8
1.0
1.2
Oranges,Average Total Cost (€/Kg)
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Euros/Kg
Production per Farm (Kg)
0 5,000 10,000 15,000 20,000 25,0000.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
Mandarines,Average Total Cost (€/Kg)
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
0 1000 2000 3000 4000 5000 6000 7000 8000 90000
2
4
6
8
10
12
14
16
18
Olive Oil, Dry Cultivation,Average Total Cost (€/Kg)
Euros/Kg
Production per Farm (Kg)
Therefore, beyond a minimum level of production:
1. Costs remain essentially constant
2. Strong indications for constant returns to scale
3. No substantial differences in efficiency of farms
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
In the short-run: all farms are economically sustainable:
(*) those who with their revenue cover their variable costs
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.50%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Variable Cost/Revenue
Utilized Agricultural Area (Ha)
short-term economically sustainable farms*
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
long-term economically sustainable farms*
In the long run:• UAA up to 2,3 ha: two-thirds of farms are economically sustainable• UAA>2,3 ha: all farms are economically sustainable
(*) those who with their revenue cover their total [variable+fixed] costs
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.50%
100%
200%
300%
400%
500%
600%
700%
800%
Total Cost/Revenue
Utilized Agricultural Area (Ha)
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40 1.60 1.800%
100%
200%
300%
400%
500%
600%
700%
800%
Total Cost/Revenue
On-Farm Employment (Annual Work Units)
Only 8 out of 65 farms (12%) employ >1 Annual Work Units
………………
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
See also: EU-RD Report 2013, pp. 119-121
Household’sStandard of Living
Equivalent Household Income, in comparison to:
1. Average Equivalent Household Income of Peloponnesus Region
2. Poverty Line
Percentage of Households in each category
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Average Equivalent Household Income of Peloponnesus Region
1,5%
15,4%
83,1%
Poverty Line
Some persistent problems
• A very low degree of co-operation among farmers
• An agro-tourist festival in the area, since 1998, which has never been used from the locals for the promotion of their products
• Change in land use, from fertile cultivated land, to land for construction
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Resilience to the current crisis (I):
2006-2011: Although product prices have fallen, farms remain economically sustainable and households retain medium and high income,
mainly due to: • Further farm expansion and improved management (e.g.
increased yields per ha), combined with– conversion to organic farming, or– farm succession
• Increase of direct sales to Athens’ open-air markets (29% of farms in 2006, 38% in 2011)
• Unabated demand for tourist services
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Resilience to the current crisis (II):
farm expansion: before the advent of the crisis (in 2006-2009).Now, the farmers have not any other potential for new farm investments
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development
Conclusions
Increased stability of Farms/Farm Households and potential to recover after external shocks, due to:
1. A farm economy well integrated with the broader regional and local economy
2. Diverse viable livelihood strategies pursued from Farm Households
3. A concrete cost structure for farm products, indicating constant returns to scale
ΓΕΩΠΟΝΙΚΟ ΠΑΝΕΠΙΣΤΗΜΙΟ ΑΘΗΝΩΝAGRICULTURAL UNΙVERSITY OF ATHENSDepartment of Agr. Economics & Rural Development