The financial significance and impact of support payments for organic farms

Summary

Organic farming has been financially supported throughout Europe since 1994. In this period, the sector has shown very dynamic development. In the meantime, a large range of measures has been offered, targeting the promotion of the organic food sector. Measured against the level of finance expended, payments for the introduction and maintenance of organic farming continue to emphasise policies supporting organic farming in Europe. Against the background of increasing discussion on the shape and level of organic farming payments, the question emerges of their impact on the sustainable development of organic farming.
In this contribution, the main features of organic payments are first briefly presented. Then the importance that farmers from different European countries place on the payments with regard to their decision to convert and the economic viability of their farms is discussed. On the basis of farm models and farm accounting data, the significance of organic payments, in relation to other agricultural supports and to organic price premiums, will be analyzed, followed by a discussion of their influence on international competitiveness.