Major characteristics of the economic role of family farms and enterprises in hungarian agriculture

Harangi-Rákos, Mónika – Szabó, Gábor – Popp, József

Keywords: gross output, gross value added, cooperation, crop production, livestock production

The aim of this paper is to underline that family farms – in contradiction to the mainstream belief - do play a significant role in the agricultural output of Hungary. Based on databases of the Hungarian Central Statistical Office, the Farm Accountancy Data Network database of the Research Institute of Agricultural Economics (AKI) and the 2010 General Agricultural Census, our analysis used simple statistical methods to draw our conclusions. On the basis of the Census data, we find it important to empha-sise that over one fifth of broadly defined family farms today produce commodities for the market. The gross output of family farms and enterprises was analysed by product groups based on data of the Economic Accounts for Agriculture. The results clearly show that family farms play a decisive role in seven of the nine crop product groups, including cereals. In the livestock sector enterprises play a dominant role. According to AKI data on the output of commercial farms between 2001 and 2011 it can be stated that family farms with a Standard Output of more than EUR 4 thousand played an in-creasing role. The majority of family farms produce only for own consumption. How-ever, the common view that commercial production is the main function of farms is wrong. Food produced for own consumption indirectly contributes to the increase in food exports and the reduction of food imports, leading to a higher domestic food secu-rity level. In addition, family farms play an important role in creating jobs in rural ar-eas. In 2010, 82% of total annual agricultural working units were used by family farms. The basic condition for strengthening the commercial role of family farms is to im-prove their willingness to cooperate with each other. The most important conclusion is that it is a false approach and practice to consider family farms as homogeneous. Fur-ther studies should be carried to examine the internal structures of both family farms and enterprises.

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