Azerbaijan Farm Policy Analysis Training workshop

Transcription

1 EC/FAO Programme on Information Systems to Improve Food Security decision-making in the ENP East Area Azerbaijan Farm Policy Analysis Training workshop Gábor Suga, Hungary, Research Institute of Agricultural Economics 28th June 2012, Baku, Azerbaijan 1

2 Short overview of the presentation Methodological clarification of the resulting account (what is actually the main difference in the income indicators of the financial accounting and of the so called management model?) Examples on utilization of FDMS data in Farm Policy Analysis

3 I. Scheme of Gross Margin Data Collection (financial accounting) Revenues enterprise 1 Revenues enterprise 2 Revenues enterprise X minus minus minus Variable costs enterprise 1 equals Variable costs enterprise 2 equals Variable costs enterprise X equals Gross margin enterprise 1 Gross margin enterprise 2 Gross margin enterprise X Total Farm Gross Margin minus Overhead costs minus Depreciation equals Net Farm Income Source: On the basis of TCP/AZE/3001(A) Farm Business Management training manual/guidelines

4 Gross Margin (G.M.) = Revenues Variable costs Revenues are definied as value of output of each enterprise within the farm business. Variable costs are definied as those costs, which Occur only if something will be produced Vary with the volume of each separate enterprise within the farm business Can easily be allocated to the individual enterprise Fixed costs are definied as those cost, which do not vary with the volume of each separate enterprise within the farm business (e.g. long term costs). It sometimes can be difficult to allocate to the enterprise. Pro G.M. approach: Easy to understand the results on enterprise level Provides direct information for sectoral agricultural policy Strong statistical background is not needed Contra G.M. approach: More difficult data collection It is difficult to calculate the net farm income (taking into account of fodder production, winter crops problem accounting/calendar year)

5 II. Scheme of Management Model Approach Market revenues - Intermediate consumption + Balance subsidies & taxes = Gross Farm Income - Depreciation = Farm Net Value Added - External factors (rent paid, wages) + Balance subsidies & taxes on investments = Farm Income

6 Pro management model approach: Clear results on farm level Simpler data collection Commonly used in E.U. for policy analysis (Farm Accountancy Data Network) Contra management model approach: Strong statistical background is indispensable (Census, Farm typology, weighting scheme) Provides only indirect information for the sectoral agricultural analysis

7 Utilization of FDMS data in Farm Policy Analysis The most common objectives in Policy Analysis are: Efficiency analysis (allocation of resources to effect maximal national output) Farm Income distribution (allocation of benefits of agricultural production to preferred groups or regions) Employment and food security Hungarian examples to utilization FADN data briefly: o Evolution of land prices and land rent fees by FADN farms o Labour expenditure by age-groups of farmholders o Financial indicators of farms with large utilesed agriculture area (above 1200 ha) o Impact of forthcomming CAP (Common Agricultural Policy) reform on the profitability of farms

8 To the objective distribution of income: Distribution of the Net Farm Income according to the stock-size of cattle rearing and fattening farms AZN/farm < All farms Stock-size (head)

9 To the objective Efficiency: Work force productivity of different type of farming AZN/working days Field crops Livestock Mixed Perennial Vegetable All farms T.F.G.M/ Tot.labour N.F.I/Tot.labour

10 To the objective Employment: Family labour Hired labour Type of farming Sample No.of workers Working days/year Total paid (AZN) No.of workers Working days/year Total paid (AZN) Field crops Livestock Mixed farms Perennial farms Vegetable producers Total

11 To the objective cost analysis: Distribution of main variable cost factors in the winter wheat production - FDMS data 2011 Other var.costs, 23% Seeds, 32% Irrigation, 9% Harvesting, 10% Sowing, ploughing, harrowing); 26%

12 Thank you for your attention!