Basic
information on Poland's economy and agricultural sector are available
in a number of sources:
Polish agriculture
Agriculture accounts for about 5 percent of Poland's Gross Domestic
Product but employs about a quarter of Poland's labor force. The
overall economy has achieved significant growth since 1992, but
agriculture has grown more slowly. Slow progress in consolidating
Poland's small, fragmented private farms has stunted overall productivity
growth.
Agricultural output has varied considerably since 1989, growing
by as much as 7 or 8 percent in some years, but falling by equal
amounts in others. There has been greater variability in crop yields.
With declining use of inputs, crops are more vulnerable to poor
weather. Crop output continues to stagnate, although the livestock
sector appears to be rebounding.
The most important crop in Poland is wheat (with between 8 and
9.5 million metric tons produced per year), followed by rye and
rapeseed. The principal livestock product is pork (between 1.7 and
1.8 million metric tons are produced in most years), which accounts
for about three-fourths of the meat output. Other important commodities
include potatoes, vegetables and fruits, poultry and eggs, milk,
cattle, and sugarbeets.
Poland exports rapeseed, live cattle, processed meat, fruits, and
vegetables and imports mainly grains, meat, protein meal, and cotton.
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Crop production
Since the beginning of its transition to a market economy, Poland's
average grain yields have remained below the 1986-90 average. In
part, the low yields are the result of declining use of fertilizers
and other chemicals, but Poland has also suffered some extreme weather
conditions, ranging from droughts to severe flooding. Despite the
fall in real producer prices, area planted to grains has changed
very little. Average wheat area has actually risen, possibly in
response to the minimum prices established in 1992 (see policy
page for more detail).
Poland's other principal crops include sugarbeets, potatoes, and
rapeseed. Sugarbeet production, which peaked in 1997, has fallen
due to declining profitability in the sugar industry. Potatoes continue
to be a staple in the Polish diet, but are declining in importance
as a source of hog feed. The output of rapeseed, the only major
oilseed produced in Poland, has varied considerably since the beginning
of the transition. Area has fluctuated widely in response to changes
in prices of rapeseed vs. wheat, and yields have varied even more.
With lower input use, rapeseed has been vulnerable to extreme weather
conditions.
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Livestock
As with all transition economies, inventories of cattle and poultry
plummeted immediately after the beginning of the transition. Producers
were hit hard by a sudden worsening of their terms of trade: prices
of inputs rose to world levels, while real output prices fell as
demand plummeted. Between 1990 and 1993, cattle numbers declined
by 25 percent and poultry by 10 percent. The Polish hog sector,
on the other hand, settled into a clearly defined hog cycle, responding
rapidly to fluctuations in world grain prices.
Swine. Unlike other transition economies, Poland's
hog inventory did not contract significantly when market reforms
were imposed, despite elimination of production and consumption
subsidies. Even before the beginning of market reforms, nearly 80
percent of Poland's hogs were in the private sector. These producers
were largely isolated from the state-controlled sector of the economy
and relied on whatever feed they could produce themselves. As a
result, even then Poland's hog sector was subject to a clearly defined
cycle, determined by the volume of the grain crop. This cycle became
more variable during the 1990s; shorter periods between the beginning
and end were primarily a consequence of greater fluctuations in
grain prices after 1990.
Feeding efficiency improved in the second half of the 1990s. In
the late 1980s, nearly 5 kilograms of feed were needed to produce
1 kilogram of live weight. In the late 1990s, the ratio was around
3 to 1. Only the smallest farmers still feed potatoes. Larger producers
have increased their use of mixed feeds.
Poultry. The poultry sector in Poland suffered milder
disruptions than in neighboring countries during the transition.
Overall, poultry numbers declined 10 percent between 1988 and 1992.
However, the declines were mainly in layers; broiler numbers remained
stable and soon began to increase.
Several factors account for the smooth transition of Poland's poultry
industry. First, as with hogs, the poultry industry was largely
privately owned at the outset of reform. Private ownership accounted
for over 80 percent of birds in 1988.
Moreover, even before 1990, production and processing operations
were highly integrated. Poultry production was vertically integrated,
with contractors supplying eggs to growers, who in turn supplied
birds to the processor. Processors prescribed feed rations, and
growers received performance premiums. The early years of the transition
saw some degree of breakdown in this integration, but the industry
remains more integrated than other livestock sectors. The high degree
of integration, together with poultry's relatively short production
cycle, allowed the industry to respond to an economic environment
where prices, rather than central planning, allocate resources.
Poultry products are increasingly popular with Polish consumers.
Per capita poultry consumption was roughly 9 kilograms in the decade
before reform. Since 1993, it has risen to almost 12 kilograms.
Poultry consumption surpassed beef for the first time in 1996, primarily
due to lower poultry prices relative to beef and pork. Consumers
prefer poultry for health reasons as well.
Cattle. The transition of the Polish cattle and dairy
sector resembles that in other Central and Eastern European countries.
As in the other transition economies, Poland's cattle are mainly
dual-purpose dairy/beef animals, and the sector's evolution was
dominated by shocks to the dairy market. During the Communist period,
the dairy sector received a disproportionate share of consumer subsidies.
Demand for dairy products collapsed with the termination of consumer
subsidies and decline in consumer income at the end of 1990, leading
to a rapid liquidation of inventories. Cattle numbers fell over
30 percent during the 1990s. To an extent, however, the inventory
reduction has been offset by rising productivity of the dairy industry,
as average milk per cow increased over 16 percent during the transition
period. Consumption of beef and dairy products appears to have stabilized
in recent years.
Food
processing
While the agricultural production sector stagnated, the food processing
industry showed strong growth during the transition period. Meat
and poultry processing, alcoholic beverage production, and sugar
and confectionery processing are major components of the Polish
food processing industry.
As in other transition economies, the sector is characterized by
a small number of large plants of fairly good quality and a large
number of smaller plants that cannot hope to meet EU standards and
will likely go out of business once standards are strictly applied.
In response to this pressure, the industry is increasingly concentrated.
See the EU accession page
for a discussion of the issues facing Poland's crop, livestock,
and food processing sectors as they integrate into the EU economy.
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for more information, contact:
Nancy Cochrane
web administration: webadmin@ers.usda.gov
page updated: August 16,
2004
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