Платформа знаний о семейных фермерских хозяйствах


Agriculture is an important branch of economics. It uses the most land, produces the most food products. It is one of the largest employers in the rural areas and it preserves the environment and it preserves the quality of rural environment. Agriculture has been affected the changes in politics during the last twenty years. Structure of the land management changed fundamentally in Latvia in the beginning of the nineties. Collective farms were liquidated. It resulted in emerging of private farms, which started to dominate Latvian rural sector, and household farms. Eleven years ago Latvia has joined European Union. After joining EU Latvia adopted laws and regulations of EU and adapted to EU principles. Farming was and still is one of the most important industries that were restructured. Rapid development of the industry was anticipated. Development of the industry is observed every year.



However, competitiveness of agriculture in Latvia is still low compared to other EU member states. Taking into account current circumstances it is very important to detect the most significant problems in production resources as well as opportunities. Averting the problems or exploiting the opportunities would lead to improvements in farming in Latvia by increasing production efficiency and competitiveness. This is crucial because current farm production indicators are lower than in the other EU member states.

There is no clear definition of what a family farm is in Latvia. However, farms at which primarily the most of the work is done by members of the family is considered to be the family farm. Every member of the family is involved in the work- men, women, and grandparents, grandchildren, which ensures exchange of know-how and experience and inheritance of the farm from generation to generation. Family farms are involved in different industries- crop farming, cattle breeding, forestry, fishery, and food processing. Area of land for agricultural use in Latvia is 1872.5 thousand hectares, which constitutes almost 30% of territory of Latvia, which makes family farms the fundamental element of rural areas because it is not just a business, it is a lifestyle.

According to the data, there are approximately 83 thousand of farms, most of which are family farms – around 73 thousand of them. They are registered under different forms (farmers choose the most convenient form of registration from the taxation perspective).

The key employers in rural areas are agricultural, forestry, fishery and, food processing companies that together ensure 49% of all workplaces. Therefore it is important to support family farms, which constitute the basics for rural population and preservation of traditions and cultural heritage. In order to maintain necessary inflow of funds farms usually choose specialization in a particular industry. For instance:

  • gardening, aquaculture
  • additional branches, like rural tourism, ecotourism, home craft food production etc.
  • biologic or integrated production of agricultural products
  • involvement into cooperatives and organizations of producers
  • use of innovative technologies, production methods or production of products
  • restructuring to different non-agricultural branches of production, for instance, crafts, services, woodworking etc.

In order for family farms to be competitive they have to unite into cooperatives, which allow them to compete with the big farms. Family farm owners in Latvia indicate that problems are created by huge bureaucracy burden, laws and support programs that are not small entrepreneur-friendly. They believe this to be true because in the previous planning period supports were more accessible to big farms. For each hectare or livestock unit big and medium farms would receive two or even three times more money than the small farmers. The big farms are the ones with the lowest profitability relative to own capital. Small farms are economically effective. However, production amounts are not sufficient for asset replacement, increasing production capacity. These farms cannot become competitive market participants without governmental support. Therefore in the new planning period emphasis is put on availability of extra fund for small and medium-sized farms. There are solutions created for support of family farms in the 2014 – 2020 planning period.

There are following support instruments included in Rural Development Program:

  • Development of farms
  • Support to young farmers
  • Support to development of small farms
  • Support for establishing and development of an enterprise in non-farming production in rural areas
  • Biologic farming
  • Implementation of LEADER approach:
    -rural tourism
    -non-farming entrepreneurship (turnover under 70 000 EUR a year)
    -home craft.

For Latvia, as well as for other countries, it is crucial to preserve heritage in the rural areas. One of the key conditions for this is to support development of small farms, which keep the rural areas alive.


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