1
Agricultural and farm income
Contents 1. Agricultural output and input .............................................................................................................................................................................................. 3
Output composition ................................................................................................................................................................................................................ 3
Input composition ................................................................................................................................................................................................................... 4
Production value by country ................................................................................................................................................................................................... 5
Gross Value Added (GVA) .................................................................................................................................................................................................... 6
Trends in output value, input value and gross value added (GVA) ........................................................................................................................................ 8
2. Income of the agricultural sector ......................................................................................................................................................................................... 9
Agricultural factor income ...................................................................................................................................................................................................... 9
Agricultural entrepreneurial income ..................................................................................................................................................................................... 11
Agricultural income compared to wages in the rest of the economy ................................................................................................................................... 15
Agricultural income indices .................................................................................................................................................................................................. 16
3. Farm income ...................................................................................................................................................................................................................... 18
Regional differences in farm income .................................................................................................................................................................................... 20
Regional differences in the agricultural income of family workers ..................................................................................................................................... 21
Farm income by economic farm size .................................................................................................................................................................................... 22
Farm income by type of farming .......................................................................................................................................................................................... 23
Farm income variability ........................................................................................................................................................................................................ 24
This document does not necessarily represent the official views of the European Commission
Contact: DG Agriculture and Rural Development, Unit Farm Economics
Tel: +32-2-29 91111 / E-mail: [email protected]
© European Union, 2018 - Reproduction authorised provided the source is acknowledged
2
Figures
Figure 1: Output of the agricultural industry (EU-28, 2017) ...................................................................................................................................................... 3 Figure 2: Intermediate inputs consumed by the agricultural industry (EU-28, 2017) ................................................................................................................ 4
Figure 3: Output shares by country, 2017 .................................................................................................................................................................................. 5 Figure 4: Gross Value Added in agriculture, real prices (2010=100), EU-28 ............................................................................................................................ 6
Figure 5: Gross Value Added in agriculture, current prices, 2017 ............................................................................................................................................. 6 Figure 6: Gross value added in agriculture per annual work unit ............................................................................................................................................... 7
Figure 7: Output value, input value and gross value added (EU-28; real prices) ....................................................................................................................... 8 Figure 8: Development of input and output price indices, EU-28 .............................................................................................................................................. 8 Figure 9: Agricultural factor income (real), EU-28 .................................................................................................................................................................... 9
Figure 10: Agricultural factor income (real) per annual work unit, EU-28 ................................................................................................................................ 9
Figure 11: Agricultural factor income (current) per annual work unit per country, 2017 ........................................................................................................ 10
Figure 12: Agricultural factor income per AWU at current prices and in PPS, 2017 .............................................................................................................. 10 Figure 13: Agricultural entrepreneurial income (real), EU-28 ................................................................................................................................................. 11
Figure 14: Agricultural entrepreneurial income (real) per family work unit, EU-28 ............................................................................................................... 11 Figure 15: Agricultural entrepreneurial income (current) per family work unit by country, 2017 .......................................................................................... 12 Figure 16: EU-28 agricultural income 2005-2017 (real terms) ................................................................................................................................................ 13
Figure 17: EU-28 agricultural revenue composition (real terms), 2005-2017 ......................................................................................................................... 14 Figure 18: Entrepreneurial income per family work unit compared to average wages in the economy, EU-28 ..................................................................... 15
Figure 19: Agricultural wages compared to average wages in all sectors of the economy, EU-28 ......................................................................................... 15 Figure 20: Agricultural income indicators, EU-28 ................................................................................................................................................................... 16
Figure 21: Indicator A, 2017 .................................................................................................................................................................................................... 16 Figure 22: Farmers' income and labour development index (real terms) ................................................................................................................................. 17 Figure 23: Farm income indicators over time and by country group ....................................................................................................................................... 18
Figure 24: FNVA per AWU and FFI per FWU, 2015 .............................................................................................................................................................. 18
Figure 25: Share of farms by economic situation, EU, 2004-2013 .......................................................................................................................................... 19 Figure 26: Regional differences in farm income ...................................................................................................................................................................... 20
Figure 27: Regional differences in family farm income ........................................................................................................................................................... 21
Figure 28: FNVA/AWU by economic size class in the EU-28, 2015 ...................................................................................................................................... 22 Figure 29: FNVA/AWU by economic size class, 2015 ............................................................................................................................................................ 22 Figure 30: Income by farm type, EU-28, 2015 ......................................................................................................................................................................... 23 Figure 31: Share of farms with an income drop above 30% per year, EU ............................................................................................................................... 24
Figure 32: Share of farms with income (FNVA) drop >30% compared to average of 3 previous years, EU .......................................................................... 25
Figure 33: Share of farms with income (FNVA) drop >30% by sector, EU 2007-2015 .......................................................................................................... 26 Figure 34: Share of farms with income (FNVA) drop >30% - cereals, oilseeds, protein crops, EU ....................................................................................... 26
Figure 35: Share of farms with income (FNVA) drop >30% - olives, EU ............................................................................................................................... 27 Figure 36: Share of farms with income (FNVA) drop >30% - sheep and goats, EU ............................................................................................................... 27 Figure 37: Share of farms with income (FNVA) drop >30% - dairy, EU ................................................................................................................................ 27 Figure 38: Share of farms with income (FNVA) drop >30% - pigs and poultry, EU .............................................................................................................. 27
3
1. Agricultural output and input1
Output composition
In 2017, the agricultural industry of the
EU-28 produced a total output value of
427 billion Euros (up from 400 billion
Euros in 2016).
Half of this output value came from crop
production (led by vegetables and
horticultural plants).
Another 39.6% came from animals and
animal products (with milk accounting for
the greatest share of output value).
Agricultural services and secondary
activities contributed 8.6% of total output
value.
See also Eurostat's statistical book on
Agriculture, forestry and fishery statistics -
2017 edition for more details.
1 2017 figures are estimates and can still change.
Figure 1: Output of the agricultural industry (EU-28, 2017)
50.1%
39.6%
8.6%
other crop products 0.7%
Olive oil, 1.4% Potatoes, 2.6%
Industrial crops, 5.2%
Wine, 4.9%
Forage plants, 5.5%
Fruits, 6.2%
Cereals, 10.8%
Vegetables and horticultural plants,
12.9% Eggs, 2.4% Poultry, 5.0%
Cattle, 8.2%
Pigs, 8.9%
Milk, 13.9%
Other animals, 0.6%
Other animal products, 0.6%
Agricultural services, 4.8%
Secondary activities, 3.8%
CropAnimal
Others
Total output value:
EUR 427 billion
Source: Eurostat
4
Input composition
Feedstuff for animals accounts for the
highest share (36.2%) of total intermediate
inputs, more than three times the share of
energy and lubricants (11.2%).
Fertiliser and soil improvers, plant
protection products and seeds/planting
stocks are inputs used exclusively for crop
production. Together, they account for
17.8% of total intermediate inputs, less
than half the value of feedstuff.
Figure 2: Intermediate inputs consumed by the agricultural industry (EU-28, 2017)
Feedingstuffs 36.2%
Other goods and services 14.9%
Energy, lubricants 11.2%
Agricultural services 7.4%
Fertiliser and soil improvers 7.3%
Maintenance of materials 6.1%
Plant protection products 5.2%
Seeds and planting stock 5.3%
Veterinary expenses 2.7%
Maintenance of buildings 2.1%
Total intermediate input: EUR 243 billion
Source: Eurostat
5
Production value by country
In terms of output value, France was by far the biggest agricultural producer in the EU in 2017 (16.8% of total EU output value), followed by
Germany (13.3%), Italy (12.8%) and Spain (11.5%).
Figure 3: Output shares by country, 2017
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
2017 Output of the agricultural industry 2017 Crop output 2017 Animal outputSource: Eurostat
6
Gross Value Added (GVA)
GVA is calculated as total output value
minus intermediate consumption (variable
inputs). It represents the part of revenue
that is left to pay for fixed production
factors (land, labour, capital) and to serve
as income for the farmer and non-salaried
workers (usually members of the farmers'
family).
In real terms, GVA in agriculture suffered
a drop in 2009 as a result of the sharp
decline in agricultural prices following the
financial crisis in 2007/2008. It has since
then recovered to pre-crisis levels but not
shown any significant growth. However,
estimates for 2017 look promising.
GVA in current prices once again highlight
the main agricultural producers in the EU
(Italy, France, Spain and Germany), in a
slightly different order than for output
value (see Figure 3).
Figure 4: Gross Value Added in agriculture, real prices (2010=100), EU-28
Figure 5: Gross Value Added in agriculture, current prices, 2017
0
20 000
40 000
60 000
80 000
100 000
120 000
140 000
160 000
180 000
200 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
mill
ion
Eu
ro
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
Ital
y
Fran
ce
Spai
n
Ger
man
y
Net
her
lan
ds
Un
ite
d K
ingd
om
Po
lan
d
Ro
man
ia
Gre
ece
Hu
nga
ry
Au
stri
a
Ire
lan
d
De
nm
ark
Po
rtu
gal
Be
lgiu
m
Swed
en
Bu
lgar
ia
Cze
ch R
epu
blic
Fin
lan
d
Lith
uan
ia
Cro
atia
Slo
vaki
a
Slo
ven
ia
Latv
ia
Cyp
rus
Esto
nia
Luxe
mb
ou
rg
Mal
ta
mill
ion
Eu
ro
Source: Eurostat
Source: Eurostat
7
GVA can serve as an indicator for labour productivity when it is divided by the number of full-time annual work units (AWU).
There are considerable differences across countries in absolute GVA per AWU (however, these figures have not been adjusted for purchasing power).
Between 2010 and 2017, most EU countries have seen a growth in their GVA per AWU. For the EU as a whole, GVA/AWU increased by 2.8% per year.
Figure 6: Gross value added in agriculture per annual work unit
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
80 000
Neth
erlands
Denm
ark
Germ
any
Belg
ium
United…
Fra
nce
Luxem
bourg
Sw
eden
Spain
Italy
Austr
ia
Irela
nd
Fin
land
Cypru
s
Czech…
Slo
vakia
Gre
ece
Esto
nia
Malta
Port
ugal
Hungary
Lithuania
Bulg
aria
Pola
nd
Latv
ia
Slo
venia
Cro
atia
Rom
ania
Gross Value Added (GVA) in agriculture per annual work unit (EUR/AWU); 2017
EU-28
BE BG
CZ DK
DE EE
IE EL
ES FR
HR IT
CY LV
LT LU
HU MT
NL AT
PL PT
RO SL
SK FI
SE UK
EU-28
-5 0 5 10 15
GVA/AWU: Average annual growth rate (2010-2017); % per year
Source: DG Agriculture and Rural Development, based on Eurostat data
8
Trends in output value, input value and gross value added (GVA)
The value of agricultural output (in real terms)
shows no clear trend over the last 12 years. The
general picture is a slight increase in both output
and input value, leading to stagnation in GVA.
The impact of the financial crisis is visible in the
dip in output value and GVA in 2009.
Agricultural output value grew during the years
2010-2013 but declined again in the years 2014-
2016. Estimates for 2017 show a recovery of
output value and GVA.
Intermediate consumption value increased until
2013 (except for 2009) and then declined slightly.
Overall output and input prices fluctuated over the
last 12 years, with a clear dip in 2009 (the year
following the financial crisis) followed by 4 years
of increases and 3 years of decreases. 2016 figures
were close to the levels of 2010. Estimates for 2017
show a recovery of output prices.
Figure 7: Output value, input value and gross value added (EU-28; real prices)
Figure 8: Development of input and output price indices, EU-28
100 000
150 000
200 000
250 000
300 000
350 000
400 000
450 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
mill
ion
Eu
ro
Output value Input value GVA
90.0
95.0
100.0
105.0
110.0
115.0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
ind
ex
valu
e;
20
10
=10
0
Price index agricultural output Price index intermediate consumption
Source: Eurostat
Source: Eurostat
9
2. Income of the agricultural sector2
Agricultural factor income3 In the EU-28, agricultural factor income (both total
and per worker) recovered from the financial crisis
of 2009 and reached a new peak in 2011. The
following three years (2012-2014) saw relatively
minor changes in real terms. Factor income was
lower in 2015-2016, but estimates for 2017 look
promising.
Changes in factor income can be divided into
volume effects (bad/good harvests,
increased/reduced herd sizes, etc.) or value effects
(higher or lower prices for inputs and/or outputs).
In 2015, the income drop can be linked to the milk
market crisis, with deteriorating milk prices leading
to a decline in the overall value of milk output.
Together with a decline in real pig prices, the
overall real value of animal output decreased by
5.9%.
In 2016, important changes at the level of the EU-
28 include a reduction in crop output value by
2.5% (mostly due to low cereal harvests) and a
decline in animal output value by 2.1% (mainly
linked to low milk prices).
In 2017, the value of animal output increased, due
to an overall price increase of 10%. In particular,
prices for pigs (+12%), milk (+18%) and eggs
(+14%) have increased considerably at EU level
compared to 2016.
See also Common Context Indicator 25:
Agricultural factor income
2 2017 figures are estimates and can still change
3 See glossary.
Figure 9: Agricultural factor income (real), EU-28
Figure 10: Agricultural factor income (real) per annual work unit, EU-28
0
20 000
40 000
60 000
80 000
100 000
120 000
140 000
160 000
180 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
mill
ion
Eu
ro
0
2 000
4 000
6 000
8 000
10 000
12 000
14 000
16 000
18 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Euro
/AW
U
Source: DG Agriculture and Rural Development, based on Eurostat data
Source: Eurostat
10
At country level there are significant differences,
with incomes in the old Member States generally
higher than in the countries that joined the EU in or
after 2004 (Portugal is an exception). The lowest
factor income levels per full-time worker can be
found in Romania, Slovenia and Croatia (all below
6 000 EUR/AWU per year). At the other end of the
scale, factor income per full-time worker in the
Netherlands stands at EUR 59 657 or more than 3
times the EU average (EUR 17 846/AWU).
If differences in general price levels are taken
into account, the picture changes significantly for
individual countries. Many countries with high
factor income per AWU have lower values in
purchasing power standards (PPS), while those
with low factor income per AWU have higher
values in PPS (especially the Czech Republic,
Slovakia, Hungary and Bulgaria). The gap between
highest and lowest values is reduced substantially –
while a full-time farm worker in Romania
generates about 8% of the nominal factor income
that his/her counterpart in the Netherlands earns,
this share increases to 17% once adjustments for
price level differences have been made.
Figure 11: Agricultural factor income (current) per annual work unit per country, 2017
Figure 12: Agricultural factor income per AWU at current prices and in PPS, 2017
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
Euro
/AW
U
EU-28
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
Euro
or
PP
S/A
WU
Euro/AWU PPS/AWU
Source: DG Agriculture and Rural Development, based on Eurostat data
11
Agricultural entrepreneurial income4
In the EU-28, total agricultural
entrepreneurial income has recovered
rapidly after the crisis years 2008-2009.
2017 was a particularly good year5,
especially compared to the two previous
ones (2015 - 2016).
Entrepreneurial income per full-time
family worker has increased even beyond
the level of the pre-crisis years, indicating
a reduction in the family labour force
and/or higher family labour productivity as
compared to 2007 and before. While no
clear trend was visible between 2011 and
2016, estimates for 2017 show a
significant increase.
4 See glossary
5 2017 values are estimates and can still change.
Figure 13: Agricultural entrepreneurial income (real), EU-28
Figure 14: Agricultural entrepreneurial income (real) per family work unit, EU-28
0
20 000
40 000
60 000
80 000
100 000
120 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
mill
ion
Eu
ro
0
2 000
4 000
6 000
8 000
10 000
12 000
14 000
16 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Euro
/AW
U
Source: DG Agriculture and Rural Development, based on Eurostat data
Source: Eurostat
12
While the entrepreneurial income of a full-
time farmer (or a member of his/her
family) in the Netherlands was more than
EUR 50 000 in 2017, it was below EUR
10 000 in 10 countries. Such enormous
differences may at least partly be due to
the organisational structure of
agriculture in the respective countries
(small family farms with a high degree of
own consumption versus large farms
organised as legal entities with salaried
workers). Income discrepancies between
countries can also point to different
degrees of mechanisation and labour
use, different levels of debts, or to
differences in commodity prices and
purchasing power, amongst others.
Figure 15: Agricultural entrepreneurial income (current) per family work unit by
country, 2017
0
10 000
20 000
30 000
40 000
50 000
60 000
Slo
ven
ia
Ro
man
ia
Lith
uan
ia
Cro
atia
Latv
ia
Po
lan
d
Bu
lgar
ia
Hu
nga
ry
Slo
vaki
a
Po
rtu
gal
Esto
nia
Mal
ta
Fin
lan
d
Gre
ece
Luxe
mb
ou
rg
Ital
y
Au
stri
a
Ire
lan
d
Cyp
rus
Be
lgiu
m
Swed
en
Cze
ch R
epu
blic
Ger
man
y
Fran
ce
De
nm
ark
Un
ite
d K
ingd
om
Spai
n
Net
her
lan
ds
Euro
/fam
ily w
ork
un
it
EU-28
Source: DG Agriculture and Rural Development, based on Eurostat data
13
Figure 16: EU-28 agricultural income 2005-2017 (real terms)
500 000
400 000
300 000
200 000
100 000
0
100 000
200 000
300 000
400 000
500 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
million Euro
Crop output Animal output Product subsidies other subsidies Agricultural services output
Non-agricultural secondary Seeds Energy Fertilisers Plant/animal protection
Feedingstuffs Labour Rents Interest Taxes
Other costs Entrepreneurial income
Costs
Source: DG Agriculture and Rural Development, based on Eurostat data
Revenues
14
Figure 17: EU-28 agricultural revenue composition (real terms), 2005-2017
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
450 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
million Euro
Crop output Animal output Agricultural services output Non-agricultural secondary
Product subsidies Other subsidies Entrepreneurial income
Source: DG Agriculture and Rural Development based on Eurostat data
15
Agricultural income compared to wages in the rest of the economy
Compared to average wages in the
economy, the entrepreneurial income per
family work unit came to around 46.5% in
2017 – the highest value over the last 12
years6. During the economic crisis of 2009,
this comparative value fell to 27.5%,
reflecting the significant drop in overall
agricultural income. See also Common
Context Indicator 26: Agricultural
entrepreneurial income
The agricultural income aggregates do not
represent the disposable income of farm
households, because the latter, in addition
to their purely agricultural incomes, may
also have income from other sources (non-
agricultural activities, remuneration, social
benefits, income from property).
Comparing agricultural income to average
wages in the economy nonetheless
provides an estimate for the opportunity
cost of agricultural family labour, i.e., the
average income opportunities that a person
would have outside of agriculture.
The low share of agricultural income
compared to average wage levels explains
the need for agricultural income support on
the one hand and (at least partly) the
decline in farm numbers.
Even the wages paid to agricultural
employees are less than half of what
employees receive on average in all sectors
of the economy combined.
6 2017 values are estimates and can still change.
Figure 18: Entrepreneurial income per family work unit compared to average wages in the economy, EU-28
Figure 19: Agricultural wages compared to average wages in all sectors of the economy, EU-28
29.1% 30.4%
34.8% 33.2%
27.5%
37.1%
42.7% 40.7%
42.7% 43.1%
39.8% 40.5%
46.5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
bas
ed
on
EU
R/h
ou
r w
ork
ed
43.6% 43.6%
44.6%
45.7%
46.9%
48.8%
46.9% 46.9% 47.4% 47.2% 46.9% 46.8% 46.5%
40%
41%
42%
43%
44%
45%
46%
47%
48%
49%
50%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Source: DG Agriculture and Rural Development based on Eurostat data
Source: DG Agriculture and Rural Development based on Eurostat data
16
Agricultural income indices
The evolution of agricultural income is
measured by means of three indices in
Eurostat's Economic Accounts for
Agriculture, the main data source for
agricultural income in the EU. These index
values are useful to show changes in
relation to a base year (now: 2010). They
do not, however, provide information on
the absolute level of income in a country.
Indicator A represents the real net value
added at factor cost of agriculture per total
AWU, including both salaried and non-
salaried workers in full-time equivalents.
Indicator B stands for the real
entrepreneurial income per unpaid (i.e.,
family) worker (in full-time equivalents).
Indicator C shows the development of
total entrepreneurial income (without
dividing it by the number of workers).
All three indices show the characteristic
dip in 2009 and subsequent recovery.
Indicator C continues to decline since 2013
– an indication that gains in the other two
indices are due to the outflow of labour.
For individual countries, these indicators
show a dynamic that can be quite different
from the absolute level of income. In
particular, some of the countries with the
lowest factor incomes per AWU in the EU
(such as Bulgaria, Slovakia and Hungary)
exhibited a strong increase in 2017, while
others with high levels of factor income
per AWU (e.g., Belgium) saw their values
decline compared to 2010.
Figure 20: Agricultural income indicators, EU-28
Figure 21: Indicator A, 2017
See also Common Context Indicator 25: Agricultural factor income
40
90
140
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017Indicator A: Index of the real income of factors in agriculture per annual work unit
Indicator B: Index of real net agricultural entrepreneurial income, per unpaid annual work unit
Indicator C: Net entrepreneurial income of agriculture
Linear (Indicator A: Index of the real income of factors in agriculture per annual work unit)
0
50
100
150
200
250
Mal
ta
Fin
lan
d
Be
lgiu
m
Slo
ven
ia
Gre
ece
Esto
nia
Fran
ce
De
nm
ark
Ger
man
y
Au
stri
a
Swed
en
Cro
atia
Un
ite
d K
ingd
om
Spai
n
Po
lan
d
Net
her
lan
ds
Luxe
mb
ou
rg
Ro
man
ia
Po
rtu
gal
Ital
y
Cyp
rus
Latv
ia
Lith
uan
ia
Cze
ch R
epu
blic
Ire
lan
d
Hu
nga
ry
Slo
vaki
a
Bu
lgar
ia
Ind
ex
valu
e (
20
10
=10
0)
EU-28
Source: Eurostat
17
Figure 22: Farmers' income and labour development index (real terms) Source: Eurostat and DG Agriculture and Rural Development
18
3. Farm income
1. The two commonly used farm income
indicators7 show the same characteristic
dip in 2009 and subsequent recovery
followed by stagnation as aggregate
agricultural income figures (see
previous parts of this chapter).
2. Both farm income indicators are higher
in the EU-15 than in the EU-N13.
3. Denmark, the Netherlands and
Luxemburg report the highest farm
income per AWU. This may be due to
the predominance of specialised
granivore (pigs and poultry) production,
as well as specialised horticulture and
dairy farms in the three countries’
agricultural sectors. At the other end of
the spectrum, Poland, Croatia, Romania
and Slovenia have the lowest farm
income per AWU, partly because their
agriculture has remained largely
oriented towards small-scale mixed
farming.8
7 Farm net value added (FNVA) per annual work unit
(AWU) and Family Farm Income per family work unit
(FWU). Please note that FFI is calculated only for those
farms with family labour - see glossary. 8 Disparities in overall price levels and purchasing
power have not been taken into account in this and the
following pages but can well contribute to different
income levels across countries.
Figure 23: Farm income indicators over time and by country group
Figure 24: FNVA per AWU and FFI per FWU, 2015
0
5000
10000
15000
20000
25000
30000
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Euro
EU-N13 FNVA/AWU EU-15 FNVA/AWU EU-28 FNVA/AWU
EU-N13 FFI/FWU EU-15 FFI/FWU EU-28 FFI/FWU
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
DK NL LU BE SE DE FR UK IT ES FI IE CZ HU AT SK EE PT EL LV CY MT LT BG PL HR RO SI
Euro
Farm Net Value Added per AWU Family Farm Income per FWU
Farm Net Value Added per AWU EU-28 Family Farm Income per FWU EU-28
Source: DG AGRI, Farm Accountancy Data Network (FADN)
19
Figure 25: Share of farms by economic situation, EU, 2004-2013
With the Farm Accountancy Data Network (FADN), farms can be classified according to their farm net income (amount available to remunerate
own factors of production (family labour, land and capital)) in relation to opportunity costs and depreciation.
This graph shows that in the period 2004-2013:
o 10% to 17% of farms faced negative net income (red and grey areas). Among them, 3% to 6% can be considered in potential "financial
distress", i.e. they cannot overcome the negative income by simply postponing the depreciation estimate (unless they have liquidities).
o Only 24% to 35% of farms had a positive farm net income higher than their estimated opportunity costs (dark green areas). It means that
for them agriculture is still the best economic alternative. Moreover, they have capacity to invest.
o For the majority of farms (54% to 60%), farm net income is positive but below the opportunity costs (light green areas). It means that in
economic terms they could make better use of their resources in another economic activity, if such an alternative exists.
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
33%
32%
33%
35%
33%
24%
30%
32%
30%
29%
55%
56%
57%
54%
54%
59%
58%
57%
58%
58%
8%
8%
7%
6%
9%
11%
8%
8%
9%
9%
3%
4%
3%
5%
4%
6%
4%
4%
3%
4%
1. Income > Opportunity costs 2. Income still positive 3. Delayed depreciation 4. Financial distress
Opportunity cost of capital:
based on the official interests
and inflation rates (provided
by Eurostat, ECB, Global
Insight)
Opportunity cost of labour:
based on the agricultural
wages paid in the region (from
FADN)
Opportunity cost of land:
based on the rents of the region
(from FADN)
Source: DG AGRI, Farm Accountancy Data Network (FADN)
20
Regional differences in farm income
The ten regions9 with the highest average
agricultural income per work unit are
located in northern Italy (Lombardia, Emilia
Romagna), Denmark, northern France
(Champagne-Ardenne, Picardie, Ile de
France, Haute- Normandie, Poitou-
Charentes), northern Germany
(Mecklenburg- Vorpommern, Sachsen-
Anhalt, Schleswig-Holstein, Niedersachsen)
in the Netherlands, Belgium (Vlanders) and
southern Sweden (Slattbygdslan). Many of
these regions have a high percentage of
highly intensive granivore (pigs and poultry)
and/or horticulture/wine production.
Regions with very low farm income (below
EUR 10 000 per year) are mostly situated in
the eastern and south-eastern parts of the
EU10
. The lowest average income per work
unit is in the Jadranska Hrvatska region in
Croatia, followed by Slovenia, 6 regions in
Romania, one region in Poland (Malopolska
and Pogorze) and one region in Bulgaria
(Yugozapaden). There is an almost 30-fold
difference between the highest income per
AWU (Lombardia: 66 201 EUR) and the
lowest (Jadranska Hrvatska: 2 249 EUR).
9 FADN divisions as defined in Council Regulation (EC)
No 1217/2009 10
Again, these figures have not been adjusted for
differences in purchasing power.
Figure 26: Regional differences in farm income
21
Regional differences in the agricultural income of family workers
The distribution of the Family Farm Income
per family work unit is similar as for
FNVA/AWU (see previous page), with a
few exceptions:
The top ten regions with the highest Family
Farm Income per FWU include the three
Spanish regions of Andalucia, Murcia and
La Rioja and the Romanian region of
Bucuresti-Ilfov.11
Denmark has a comparatively low level of
family farm income (similar to the EU
average), while it came second for
FNVA/AWU. An explanation could be the
high level of debts in Danish farms.
11 Please note that Family Farm Income is calculated in a
different sample than FNVA. Only those farms are
included in the sample, which have family labour
force.
Figure 27: Regional differences in family farm income
22
Farm income by economic farm size
The farm income per full-time work unit
increases with the economic size of the
farms. This implies that the labour
productivity is higher on (economically)
bigger farms.
This relationship holds in almost all Member
States (except for the biggest farms in CZ,
EE, HU, LT, PL and FI).
Figure 28: FNVA/AWU by economic size class in the EU-28, 2015
Figure 29: FNVA/AWU by economic size class, 2015
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
2 k
- <
8 k€
8 k
- <
25
k€
25
k -
< 5
0 k€
50
k€
- <
10
0 k€
10
0 k€
- <
50
0
k€
>=
50
0 k€
Euro
-20000
0
20000
40000
60000
80000
100000
120000
2 k - < 8 k€
8 k - < 25 k€
25 k - < 50 k€
50 k€ - < 100 k€
100 k€- < 500 k€
>= 500 k€
Source: DG AGRI, Farm Accountancy Data Network (FADN)
23
Farm income by type of farming
By definition, Family Farm Income (FFI)
is expressed per family labour unit and is
calculated only for the subset of farms with
family labour. This explains why in some
cases FFI/FWU is higher than
FNVA/AWU for certain types of farming
such as wine, horticulture and other
permanent crops.
The highest income levels per work unit
are achieved in farms specialised in the
production of pigs and poultry
(granivores). These farms are relatively big
in economic terms.
On the other hand, mixed farms achieve
the lowest income levels and are normally
rather small.
Figure 30: Income by farm type, EU-28, 2015
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
Granivores Wine Horticulture Fieldcrops Milk Otherpermanent
crops
Othergrazing
livestock
MixedEu
ro
Farm Net Value Added/AWU Family Farm Income/FWU
Farm Net Value Added/AWU (all types) Family Farm Income/FWU (all types)
Source: DG AGRI, Farm Accountancy Data Network (FADN)
24
Farm income variability
Farm incomes can vary substantially over
time. In the EU, every year at least 20%
of farmers experience an income loss of
more than 30% compared with their
average income in the three previous years.
In the particularly difficult year 2009, this
share was above 40% (i.e., 2 out of 5
farmers had an income that was 30% lower
than in the three previous years).
A high share of farmers with strong
income drops doesn't necessarily mean that
the level of income reached is particularly
low (see next page). For example, 2014
was a good year for farm income overall,
but 36% of farms had an income drop of
more than 30%.
Figure 31: Share of farms with an income drop above 30% per year, EU
21%
31%
42%
26% 26% 28%
31%
36% 35%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2007 2008 2009 2010 2011 2012 2013 2014 2015
NB: income indicator = Farm Net Value Added (total output + balance current subsidies and
taxes-intermediate consumption – depreciation)
Analysis excludes Croatia and includes Bulgaria and Romania only from 2010
Source: DG AGRI, Farm Accountancy Data Network (FADN)
25
Figure 32: Share of farms with income (FNVA) drop >30% compared to average of 3 previous years, EU
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
0
5 000
10 000
15 000
20 000
25 000
2007 2008 2009 2010 2011 2012 2013 2014 2015
Shar
e o
f fa
rms
wit
h in
com
e d
rop
ab
ove
30
% (
do
ts)
FNV
AI/
AW
U (
bar
s)
NB: income indicator = Farm Net Value Added (total output + balance current subsidies and taxes - intermediate consumption-
depreciation)
Analysis excludes Croatia. Share of farms with income drop above 30% for Bulgaria and Romania available only from 2010
Source: DG AGRI, Farm Accountancy Data Network (FADN)
26
The sectors facing the highest income
variability year after year are: cereals,
oilseeds and protein crops (COP; 37%),
granivores; mixed crops; and fruits (in
each of these sectors, 32% of farms
experienced income drops above 30% in
2007-2015).
The COP sector suffered most from the
financial crisis in 2009, when almost two
out of three COP farmers (63%)
experienced an income loss above 30%.
Compared to other sectors, COP farms had
the highest income variability throughout
the 2007-2015 period.
Dairy farms were also strongly hit in 2009,
when half of them saw their income drop
by more than 30% compared to the
previous 3 years (see next page).
The least profitable sectors, such as olives
and sheep and goats, and the most
profitable sector (granivores) have a lower
and more constant level of farms with
losses > 30% (ranging from 25 to 38% -
see next page).
Figure 33: Share of farms with income (FNVA) drop >30% by sector, EU 2007-2015
Figure 34: Share of farms with income (FNVA) drop >30% - cereals, oilseeds, protein crops, EU
25% 27% 28% 30% 30% 30% 31% 31% 31% 31% 32% 32% 32% 37%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0%
10%
20%
30%
40%
50%
60%
70%
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
2007 2008 2009 2010 2011 2012 2013 2014 2015
% o
f fa
rms
wit
h in
com
e lo
sse
s >
30
% (
do
ts)
FNV
A/A
WU
(b
ars)
COP
NB: income indicator = Farm Net Value Added (total output + balance current subsidies and taxes - intermediate
consumption-depreciation)
Analysis excludes Croatia. Share of farms with income drop above 30% for Bulgaria and Romania available only from 2010
Source: DG AGRI, Farm Accountancy Data Network (FADN)
27
Figure 35: Share of farms with income (FNVA) drop >30% - olives, EU
Figure 36: Share of farms with income (FNVA) drop >30% - sheep and goats, EU
Figure 37: Share of farms with income (FNVA) drop >30% - dairy, EU
Figure 38: Share of farms with income (FNVA) drop >30% - pigs and poultry, EU
0%
10%
20%
30%
40%
50%
60%
70%
0
5000
10000
15000
20000
25000
30000
35000
40000
2007 2008 2009 2010 2011 2012 2013 2014 2015 % f
arm
s w
ith
inco
me
dro
p >
30
% (
do
ts)
FNV
A/A
WU
(b
ars)
Olives
0%
10%
20%
30%
40%
50%
60%
70%
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
2007 2008 2009 2010 2011 2012 2013 2014 2015
% o
f fa
rms
wit
h in
com
e d
rop
>3
0%
(d
ots
)
FNV
A/A
WU
(b
ars)
Sheep and goats
0%
10%
20%
30%
40%
50%
60%
70%
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
2007 2008 2009 2010 2011 2012 2013 2014 2015 % f
arm
s w
ith
inco
me
dro
p >
30
% (
do
ts)
FNV
A/A
WU
(b
ars)
Dairy
0%
10%
20%
30%
40%
50%
60%
70%
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
2007 2008 2009 2010 2011 2012 2013 2014 2015
% o
f fa
rms
wit
h in
com
e d
rop
>3
0%
(d
ots
)
FNV
A/A
WU
(b
ars)
Pigs and poultry
NB: income indicator = Farm Net Value Added (total output + balance current subsidies and taxes - intermediate consumption –
depreciation)
Analysis excludes Croatia. Share of farms with income drop above 30% for Bulgaria and Romania available only from 2010
Source: DG AGRI, Farm Accountancy Data Network (FADN)
