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Family Farming Knowledge Platform

  Slovenia

For Slovenia, a small, predominantly hilly and mountainous country located in the middle of Europe, family farming has been a principal model of agriculture for centuries and it is certain to remain so in the future. This model has proved adaptable to the diverse natural characteristics of Slovenia and resilient to the societal, political and market turnovers the country has faced over the years as part of different political constellations. Slovenia’s territory is characterized by its diversified terrain, rich cultural heritage and abundant and diverse natural sites. Almost 90 per cent of its territory lies 300 meters or more above sea level, while plain areas in the form of closed valleys and basins account for less than 20 per cent of the entire territory.

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The diversity of natural conditions directly influences dispersed settling, with a large number of small settlements. It is also the reason for an exceptionally diverse and relatively well preserved natural environment. Less favored areas for agricultural activity cover 86.3 per cent of the entire territory of the country, of which 72.3 per cent are mountain areas. Due to high biodiversity, 37.2 per cent of territory is included in Natura 2000 areas, which is the highest share in the European Union (EU). Forests cover 70.7 per cent of the Natura 2000 area. Forests are in fact a predominant feature of the Slovenian countryside as they cover almost two thirds of the country, placing Slovenia at the very top of the EU in the share of forests. It is, therefore, no surprise that 84 per cent of the 74,646 agricultural holdings in Slovenia also own woodland according to official statistical data. Forests comprised 42 per cent of the entire area of land used by agricultural holdings in 2010, implying the importance of wood as an asset and in additional source of income.

Throughout the centuries, unfavorable geographic conditions have made it impossible for Slovenian farmers to obtain larger plots of agricultural land. According to the Statistical Office of the Republic of Slovenia (Agricultural Census 2010) and the Slovenian Agriculture Institute, an average agricultural holding cultivates 6.4 hectares of utilized agricultural area and breeds 5.6 livestock units. Considering that most of the utilized agricultural land is located in less favored areas, the structure of this land is still grasslands and pastures, which account for more than half (59.2 per cent) of agricultural land, followed by arable land and gardens with 35 per cent and permanent crops with under 6 per cent. The relation between grasslands and arable land has lately been decidedly transformed in favor of grasslands. The share of grasslands in the structure of agricultural land use is almost twice as high as the average share in the EU-27. Despite the large share, it is characteristic of grasslands in Slovenia that they are relatively poorly utilized economically, as extensive grasslands still account for a larger share than intensive ones.

Traditional, extensive farming caused the emergence of certain types of secondary habitats, which have an exceptional importance in the preservation of biodiversity. Since 2000, processes of increasing specialization and concentration have, nevertheless, taken place. Moreover, Slovenia has witnessed a steep increase in the number of organic agricultural holdings since the late 1990s. In 1998, 41 agricultural holdings were included in control, while the number had increased to 2,682 by 2012. Despite all this, the competitiveness of Slovenian farms in comparison to EU-27 remains low because of their small size. The average economic size of agricultural holdings expressed as standard income in 2010 was €12,233 (compared with €25,450 for EU-27). A low level of market orientation is another characteristic of Slovenia, as only 40 per cent of family farms place most of their output on the market. A major share of farm products is used or sold directly at agricultural holdings.

Due to specific agrarian structure, the majority of Slovenian farms cannot survive on agricultural income alone (less than one fifth can); therefore, they generate income from other sources on or outside the farm. According to official statistical data, more than more than 208,000 active working persons pursued agricultural activities in farm enterprises and family farms in Slovenia in 2010. Their labor input, together with those who performed seasonal or occasional work, amounted to 77,012 annual work units (AWU) or around 8 per cent of all employed persons in Slovenia. As much as 89 per cent of work in agriculture in 2010 was performed by family labor. One AWU in Slovenia cultivates 6.3 hectares of utilized agricultural areas, which is almost three times less than the EU-27 average. This can also partly be ascribed to the unfavorable natural conditions for agricultural activities.

As far as demographic structure is concerned Slovenia, like other EU countries, is witnessing a trend towards an unfavorable age structure of owners of agricultural holdings, with just 43.4 per cent of farmers being younger than 55 years. Only 4.3 per cent of owners of agricultural holdings are younger than 35, which puts Slovenia among the countries with the smallest share of young owners of agricultural holdings, and means it significantly lags behind the EU-27 average (7.5 per cent). The educational structure in Slovenia is somewhat better than the EU-27 average, as less than two thirds (64.4per cent) of owners of agricultural holdings have only practical experience in agriculture (the EU-27 average is 70.4 per cent), while the share of those with full agricultural education stands at 8.9 per cent (EU-27 average: 7 per cent) Various structural characteristics of Slovenian agriculture – particularly a low labor productivity, unfavorable demographic and size structure of agricultural holdings, and fragmentation of holdings – therefore reduce the efficiency of the use of production resources and hamper faster development in agriculture. In view of the challenges mentioned, family farming could provide the right answers.

The family farming system has proved to be a sufficiently resilient model throughout history to accommodate unfavorable natural conditions; increasingly volatile prices on the internal EU market and worldwide, and changes in consumer patterns and preferences. To a great extent it has remained sustainable, with extensive farming being the predominant type of farming. It has withstood the processes of societal and economic restructuring the country has witnessed over the last couple of decades, with the diminishing economic importance of this sector and the radical change in the demographic structure of the countryside. But what is more, in view of the current economic and financial crisis, it has proved more stable than other economic sectors. Once again, family farming has proved indispensable within local economies. Today, the concept of family farming stands at the crossroads, not just in Slovenia but worldwide.

In Slovenia, the importance of family farming has been emphasized in several strategic documents outlining the development of agriculture towards 2020. In 2011, the state adopted the Resolution on the strategic direction of development of the Slovenian agriculture and food sector towards 2020 –‘Ensure our food for tomorrow’. This document provides a foundation for the Strategy on the implementation of this Resolution adopted in 2014 as well as for a rural development programme (RDP 2014-2020) worth €1.18 billion. This is the most important financial instrument for agriculture in Slovenia, co-financed from the EU budget in the financial perspective 2014-2020. All these documents refer to agriculture as being an economic activity of special significance, with market-oriented family farms being the cornerstone of a sustainable model of agriculture. The aforementioned resolution states that agriculture should keep on providing an adequate supply of safe food, thus satisfying one of the basic needs of society, while at the same time it should provide other important social functions and intangible (public) goods. The ecological function of farming, for instance, is defined by its decisive contribution to the quality of water, soil, air and biodiversity. Moreover, agriculture still has a significant impact on the cultural landscape and its aesthetic and natural values. Undisputed, too, is the role of healthy, locally produced food and safe production processes in ensuring human health. With its economic and social role, agriculture has an important effect on the vitality and population density in rural areas.

Family farming is considered to correspond to all these aspects of a sustainable agricultural model. But in order to really do so, proper environment and incentives need to be ensured. Future development can only be based on farms which are professionally engaged in agriculture, which have a clear vision of their own development, are able to adapt to market conditions, and will focus on the production of high-quality products with higher added value. Moreover, these farms should have access to modern technology, land, financial assets, knowledge and innovation in order to be able to produce more effectively with significantly less impact on the environment. They should be stimulated to increase their competiveness by being better integrated into the agri-food chain through quality schemes, adding value to agricultural products, promotion in local markets and short supply circuits, and other forms of cooperation.

These aspects, among others, have all been incorporated in the following six key priority areas of intervention of the future RDP 2014-2020:

• facilitation of processes of structural adjustment in agriculture and, consequently, the creation of conditions for increasing the productivity of Slovenian agriculture

• more efficient organization of the agricultural market, strengthening of food production chains and higher recognizability and quality of locally produced products

• sustainable exploitation of forests and increasing added value of wood, with better market integration in the field of forestry and along the forest-wood chain, and by increasing competitiveness in forestry and non-industrial wood processing

• promotion of agricultural practices which contribute to the good condition of natural resources and adaptation to climate change

• green jobs and coherent and sustainable development of rural areas, based on developing the potential of the local environment

• transfer of knowledge and innovation, environmental care and climate change which are horizontal objectives pursued by all five priority areas, the preservation of natural resources being the strongest objective among these with more than half of the available funding (52 per cent) awarded within RDP 2014-2020.

The common goal of all six key priority areas could be summed up as reinforcing existing family farming systems to be able to cope with new realities by underpinning them in achieving increased economic and environmental effectiveness, and to improve their market access by creating viable local markets.

Young families should be at the heart of all these efforts as they are the future backbone of rural economies. Not only could they play a pivotal role in the maintenance of farming, they are also often more inclined towards linking agriculture with other spheres of the local economy such as rural tourism, natural and cultural heritage, traditional knowledge and skills, educational activities, renewable energy production and social care. Young farmers should, in particular, be stimulated to take over the farm and grasp the opportunities of this profession as they are usually more innovative, resource-efficient and entrepreneurial, and can effectively combine the knowledge and experiences of older generations with the latest developments in the sector. This capacity for knowledge transmission from one generation to another, maintenance of tradition, mutual support among the generations as well as involvement in the local community, is another unique characteristic of family farming, which strengthens social tissue and contributes to the vitality of local communities.

Taking account of all these aspects, family farming could, indeed, prove to be a challenging but also a promising economic activity for young, entrepreneurial people. The young will be supported under RDP 2014-2020 using the measure called ‘Farm and business development’, which will offer them start-up aid for the development of their farms. Structural change, increased competitiveness and generational renewal will be allotted 20 per cent of all available funds from RDP 2014-2020. Since unfavorable structural and natural features prevent Slovenian agriculture from achieving the competitiveness of countries with significantly better conditions, focus will also be laid on increasing the added value of products and achieving greater differentiation in the offer of products which consumer will recognize.

Greater emphasis will be laid on developing local markets and short supply chains to stimulate local production, job creation and the wider economic and social vitality of the countryside, as well as market organization and cooperation in agriculture and forestry. Approximately 9 per cent of all available programme funds are intended for this priority. The largest share of funds is dedicated to the processing and marketing of farm products, where different types of repayable assistance (such as credits and subsidized interest rates) will be made available alongside grants. In the area of promoting wider local economic development in rural areas, emphasis will be given to the preservation and establishment of new jobs, diversification of income on farms, and local partnerships. The intention is to stimulate economic development by activating available local resources and potentials, such as wood, rich natural and cultural heritage, a qualified labor force, tourism, social entrepreneurship, renewable energy production and waste management. Altogether, 15 per cent of the available funds from RDP 2014-2020 are dedicated to this priority, which is targeted at developing economic activities in the countryside and local development.

Apart from grants, different types of repayable assistance for start-ups will be introduced, thus addressing the need to ensure better access to funding. With all the right incentives and the proper environment, family farming with its roots deep in the past could provide the right answer for our future as well.  

 

This text is kindly provided by the authorities of this country.

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