Organic farmers get green light for feeble financial support

Romania’s intensive agriculture is still performing below capacity, but ironically enough it is exactly this weakness that makes it a good candidate for organic farming. Up until 2010 there was little financial aid from the state and no European subsidies but from 2011 the authorities have promised a change.

Simona Bazavan

Romanian agriculture to date is a story of lost opportunity. The country has an arable land capacity of approximately 9.4 million ha, 40 percent of which, if not more, is languishing unused. More than 60 percent of the used arable land is divided up into small plots owned by individuals, making intensive farming difficult. And to give a glimpse of productivity, the lack of investment led local agriculture to generate only 5.8 percent of the GDP last year, despite employing 20 percent of Romania’s total workforce.

But it’s not all bad news, as some of these failings are valuable assets when it comes to organic agriculture. The full half of the glass is that the lack of overall intensive farming practices is turning Romania in one of the countries with the highest potential in the EU for organic agriculture.

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But in spite of this great potential the reality so far is discouraging. According to preliminary data from the Ministry of Agriculture and Rural Development (MADR), only 260,000 ha is organic certified in Romania this year, about 1.86 percent of the overall agricultural capacity, a feeble 0.26 percent up on 2009. But the situation could easily improve, Marian Cioceanu, president of Bio Romania, a local association of organic farmers, told Business Review.

He explained that clean land – which hasn’t been worked for more than two years – something of which there is plenty in Romania, can be organically certified in only one year compared to up to five years in the case of intensively cultivated plots, The demand is there, as green is taking over international markets and Romanians also are showing signs of embracing the trend, but government support and sufficient subsidies are certainly lacking, local organic farmers complain. And it all boils down to the lack of decent subsidies.

“Greek farmers get as much as EUR 600 per hectare each year, Austrians and Germans between EUR 200 and EUR 350 with the sums doubling during the conversion period because during this process the costs, including certification costs, are higher and the yield is reduced,” explained Cioceanu, adding that so far in Romania, organic farmers have received no specific financial support or European subsidies as the Romanian authorities saw no need to ask for any. This led to a drop of almost 25 percent in the number of certified Romanian organic farmers last year, according to data from MADR.

The statistics bounced back this year, surpassing the level registered in 2008 (around 4,200) after the government announced plans to support the conversion process to organic farming. Through Government Decision 759/2010, approximately EUR 3 million has been allocated to Romanian farmers interested in converting to organic farming. This specific aid amounts to as much as EUR 300 per hectare over 2010-2013. Starting next March, Romanian organic farmers will be able to apply for subsidies under the National Rural Development Program with handouts going as high as EUR 400 per hectare.

There are huge business and investment opportunities in organic farming in Romania with benefits for farmers, consumers, the environment and small rural communities alike, but the country lacks a consistent and, most importantly, coherent strategy in this field, Cioceanu thinks. He explains that so far the authorities have failed to understand and act according to the needs of organic farmers.

Buzzing over honey-sweet profits

Honey is one of the best exported Romanian agricultural products. Last year the national production amounted to 21,000 tons, of which 60 percent was exported, according to data from the Association of Romanian Beekeepers. This year, however, due to unfavorable weather conditions, production is estimated to have plummeted by about 40 percent, Ion Fetea, president of the association, told Business Review.

There were approximately 45,000 beekeepers in 2009, with 1,018 of them producing 3,600 tons of organic honey, most of which was exported. Apidava, a local producer, says it exports about 99 percent of its organic honey in bulk to Western European countries. “Although we started producing organic honey in 2007, only last year did we start to notice a significant rise in sales, about 30 percent compared to 2008,” Alina Mates-Ochis, Apidava marketing manager, told Business Review. She adds that the local organic market is in full development and it is hard to estimate its potential. “The number of local organic consumers is directly related to the increase in the standard of living,” Ochis explains.

The company, 40 percent of which is owned by a Dutch investor, produces 300 tons of honey each year, of which 20 percent is organic. The cost of producing organic is 20 percent higher than regular honey. Last year Apidava had a EUR 3 million turnover and the same figure is estimated for this year. “Although sales volumes decreased, the price went up due to the very low production,” Ochis says.