Recruitment for the Young Farmer Premium is underway. Based on ARiMR's information, it can be said that applications are literally trickling in. So far, 345 applications have been submitted. And even if some of them have increased since the last update, it's still not much.
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There are no takers for a bonus for a young farmer. The application period ends soon
It seems that it is becoming more and more difficult to manage on individual farms. Young successors do not always feel up to taking this risk. Often they had already planned their future, just differently. This year's shopping prices do not help. The latest text by editor Karol Bogacz on how much wheat should cost in order to balance the level of wages in the domestic economy also sparked considerable discussion.
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Payouts are up over 100 percent and grain is cheap. How much should wheat cost?
The increase in the minimum wage under an employment contract has nothing to do with the prices of wheat offered to farmers.
Never before has it been necessary to sell so much grain to compensate for a specific wage. Currently, over 5.7 tons of wheat must be sold to obtain an amount equal to the minimum wage – wrote Karol Bogacz, a farmer both privately and professionally.
Statistics save the situation
Let us remind you that the minimum salary for an employment contract from July 2024 in Poland is PLN 4,300, i.e. PLN 3,261.53 net.
How can farm work be profitable, how can we encourage young people to do it, when both the risks are high and the costs are rising, and it is becoming more and more difficult to obtain a decent income?
Is there anything that can save this situation? Yes, statistics as usual. Suffice it to recall that the average income per hectare on individual farms is PLN 5,549. Statistically, it looks quite good, but only because the indicator announced at the end of 2023 and applicable this year was calculated in 2022, when price levels on agricultural commodity exchanges reached their records.
It is necessary to make the Central Statistical Office indicator more realistic
The agricultural local government, both in letters to the Ministry of Agriculture and Rural Development and to the president of the Central Statistical Office, warned that the methodology for calculating average income did not keep up with the realities, which were often dynamic in recent years due to the war in Ukraine, but also earlier due to the pandemic.
In the opinion of the local government, but also of the participants of the last Senate Committee on Agriculture and Rural Development before the holidays, the profitability of agriculture is distorted, and it is increasingly difficult to cover production costs. As Senator Maciej Górski, a member of the Senate committee, said, we will see this acutely in the fall, when some farms may have problems with financial liquidity.
The senator continued his considerations on the average income in agriculture per hectare, directing questions to the Minister of Agriculture, Czesław Siekierski:
– As for the situation in agriculture, I will say this: PLN 5.5 thousand – income per hectare. Well, vegetables, I guess? This is funny, because with grain prices of several hundred zlotys per ton, it is unrealistic, when the yield is 5-6 tons, and if someone tries, it will be 7-8. And the Central Statistical Office gives 5.5 thousand for that year. Where is this income? Where is the institute of agricultural economics to calculate this? Mr. Minister! National lowest. The previous government rightly raised the lowest national wage. PLN 4,300 for simple work. A person sits down and works – PLN 4,300. Where is this young farmer supposed to get these PLN 3,600 or so? How many hectares does he have to work to have that much left?
Prime Minister and Senator Waldemar Pawlak echoed him: – When it comes to agricultural income, this one from the Central Statistical Office, it would require some verification, because it was good in stable times, but now it is sick and absurd. Because where is this income? Well, this type of income is available only in the Central Statistical Office. Some crops will not generate as much income per hectare as the Central Statistical Office shows.
How is farm income calculated?
The Central Statistical Office has already answered questions from the agricultural self-government, what is the reason for the increase in the indicator by as much as PLN 2,200? As the president of the Central Statistical Office wrote at the time:
In 2022, there was a significant increase in global production on individual farms in agriculture, which resulted in, among others, on gross disposable income. Global production in 2022 compared to 2021 increased by 47.4% in total (on individual farms by 47.7%). The increase in global production was mainly determined by an increase in animal production by 45.4% (in individual farms by 45.9%) and an increase in plant production – by 49.3% (in individual farms by 49.3%). The increase in purchasing prices had a significant impact on the increase in both animal and plant production. The purchase price index of basic agricultural products in relation to 2021 was 44.5%. The highest price increase was recorded in basic cereals, i.e.: wheat: 57.9%, rye 61.6%, barley 67.9%, oats 75%, triticale 64.9%, corn 45.3%, potatoes, e.g. 28.6%). A large price increase was recorded in sugar beet – 57.7% and oil grains – 33.8%. The increase in global production was also largely influenced by the increase in prices of animal production, i.e.: live beef 32.8%; pork 41.1%, poultry 46.2%, milk by as much as 47.6% and chicken eggs by 55.1% – explained Dr. Dominik Rozkrut, president of the Central Statistical Office, in the letter.
Will the ministry, the Central Statistical Office, and the agricultural self-government manage to make this indicator more realistic? The President of the Central Statistical Office indicates in the letter that he is open to possible changes and consultations, so we keep our fingers crossed.
