Luboš Smutka

The technical efficiency of specialised milk farms: a regional view.

The aim of the article is to evaluate production efficiency and its determinants of specialised dairy farming among the EU regions. In the most of European regions, there is a relatively high significance of small specialised farms including dairy farms. The DEAVRS method (data envelopment analysis with variable returns to scale) reveals efficient and inefficient regions including the scale efficiency. In the next step, the two-sample t-test determines differences of economic and structural indicators between efficient and inefficient regions. The research reveals that substitution of labour by capital/contract work explains the variability of the farm net value added per AWU (annual work unit) income indicator by more than 30%. The significant economic determinants of production efficiency in specialised dairy farming are farm size, herd size, crop output per hectare, productivity of energy, and capital (at α = 0.01). Specialised dairy farms in efficient regions have significantly higher farm net value added per AWU than inefficient regions. Agricultural enterprises in inefficient regions have a more extensive structure and produce more noncommodity output (public goods). Specialised dairy farms in efficient regions have a slightly higher milk yield, specific livestock costs of feed, bedding, and veterinary services per livestock unit.

Restoration and Growth of the Russian Sugar Market

The Russian Federation represents a very important stakeholder in the area of sugar beet production and consumption in Europe and Central Asia. The Russian population annually consumes over 5.9 million tonnes of pure sugar. After a long period of stagnation in the Russian sugar industry, the Russian Federation is now aiming to restore production capacities in the areas of both sugar beet growing and sugar production. The ambitious government programme has supported the growth of production potential. The government’s goal is to reduce Russian dependence on imports of sugar, especially white sugar. During the period 1992–2000, there was a fall in Russia’s own cultivation as well as processing capacities, competitiveness decreased, and dependence on imports increased significantly. By contrast, the period 2000–2014 was a resuscitation of the Russian market and economy. This was reflected in an increase in sugar beet production as well as growth in sugar production. Russia’s dependence on imports of sugar from abroad dropped considerably and changed the structure of traded goods containing sugar. This review highlights the most significant trends that have influenced the development of the Russian sugar beet industry and the current trade, in particular.

European Sugar Production and its Control in the World Market

The European sugar industry which mainly relies on sugar beet is unique with its production quotas, minimum beet price and trade mechanisms. This study aimed to outline and specify the current production structure of the sugar quota holder system in the European Union (EU) and to determine the competitiveness and level of concentration in the system which is operated by more than a hundred sugar factories owned by approximately fifty companies. The study reveals that EU quota holder system is highly concentrated in certain regions like Germany, France, Great Britain and The Netherlands regardless of sugar-producing destinations and individual factories and is controlled by the companies/alliances operating in these regions. The study also reveals that monopoly of these regions has created unfair competition in European sugar market.

Foreign trade in agricultural products in the Czech Republic

Th e article analyses trends in the territorial and commodity structure of the Czech foreign agrarian trade and aims to identify changes which have occurred during the last decade. Th e main emphasis has been put on the period after the accession to the EU. Primarily such changes are identifi ed, that occurred in the relation to the EU-Member States and to third countries. Th e results show that the value of agricultural exports and imports was growing during the surveyed period while the growth rate of agricultural exports was above the growth rate of agricultural imports. Agricultural exports increased from CZK 78 billion in 2005 to more than CZK 160 billion in 2013 and the imports rose from CZK 103 billion to more than CZK 184 billion in the same period. Th e territorial structure of the foreign agrarian trace is continuously concentrating on the EU-Single Market, both in terms of exports and imports. Exports of milk, milk products, cereals, beverages, food preparations, tobacco and tobacco manufactures, cereal preparations, food residues and waste, oilseeds, vegetable fats and oils, sugar and confectionery belong to the most important commodity aggregations. Th e share of proce- ssed products in the total exports increased and reached currently about 7%. Th e export - import coverage ratio reached a satisfactory trend as well. Although the Czech Republic does not have ideal conditions for the export-oriented agriculture, the country is able to gain comparative advantages, at least at the level of following aggregations: HS10, HS01, HS12, HS24, HS04, HS17, HS15, HS11, HS16, HS22, HS03 a HS13.

Recent areas of innovation activities in the Czech dairy industry.

Th e aim of the article is to compare and identify diff erences between the innovations within the Czech dairy industry. Dairy products are the export pillars of Czech agrarian foreign trade, and the dairy industry was one of the most important recipients of public support on innovations from the Rural Development Programme (RDP). Th e core of this research is an analysis of sixteen projects, supported under RDP sub-measure I.1.3.2 from 2007 to September 2013. Data from the representative sample of approved projects have been converted into a set of questions and answers to enable them to be evaluated, both quantitatively and qualitatively. Th e dataset is analysed by means of a counterfactual analysis, descriptive statistics, and correlation analysis. Th e results show that innovations, and public support of innovations, enabled dairies to stabilise their profi ts, and to increase their competiveness, during the period of economic crisis. Th ere were fi ve types of innovation trends in the Czech dairy industry in recent years: (i) Th e processing and effi cient use of by-products (whey, buttermilk); (ii) Th e production of new products with health benefi ts; (iii) Improved processing of dairy products with particular focus on long-life products having better sensory parameters; (iv) Improved effi ciency of transport and storage of milk and dairy products; (v) Improved wastewater treatment. Th e real innovative eff ect was, however, very limited because individual companies were not looking for their own new added value, but were more focused on the implementation of already-existing innovations.

Competitiveness analysis of Czech agrarian foreign trade in the context of world agrarian market and agrarian trade of EU-27 countries.

This paper analyses the commodity structure of Czech (CR) agrarian trade in relation to the EU countries. An emphasis is put on comparative advantages of particular aggregations from the view-point of their application on the EU internal market. This analysis is based on an evaluation of comparative advantages by means of a modified Balassa index. It is studied in two stages, for the internal EU market and the world market. The analysis results are then shown in a graph. Subsequently, the authors implement an idea arising from a BCG matrix on the results of the graphic presentation. The aim is to identify those aggregations (SITC, rev. 3) which are or have a potential to be a pillar of agri-business (ie, the “cash cows” and “stars”), and vice versa to show the aggregation which are non-prospective in the long term or problematic (ie, the “dogs” and “problem children”). As start are identified as those aggregations which are characterised by the highest growth rate of comparative advantage value. From the analysis results, changes are apparent if we compare the CR trade commodity structure in relation to the EU countries. Findings also concern the development of comparative advantages and following CR specialisation on trade with certain aggregations.

The Development of World Sugar Prices

The globalization of the world economy is a phenomenon that has historical roots that began in the early 1970s, when the Bretton Woods and the Smithsonian agreements were created. This resulted in freely floating exchange rates and the gradual deregulation of financial markets. In addition, this increased market accessibility for individual and institutional speculators. By increasing market price fundamentals, the price volatility of numerous commodities (including agricultural commodities) has increasingly grown in specific sectors of the financial markets. This is particularly true in agricultural commodity markets. This change has become a possible financial incentive for speculators. Due to the high degree of distortion and government protection, the sugar market has resisted this speculation for quite some time. However, in the context of the recent financial crisis of 2008 and 2009, this market segment could not escape the “incursions” of speculative capital. Sugar prices have “surged” upwards significantly. This is not only due to speculators, but it also due to the growing demand for biofuels. Sugar prices during the period of 2000 to 2016 saw unprecedented price fluctuations. The world sugar price has risen from about 11 cents (in early 2000) to more than 65 cents per pound of raw sugar (2010/2011). Speculative funds (hedge funds), which in recent years have made transactions on average of about twenty million tons of sugar a year, played a major role in this fluctuation. However, their impact on the price of sugar does not lie in the fact that these funds are pushing for a rise or a fall in the price of sugar, but their effect is that these funds cause in particular, price fluctuations in sugar because they attempt to profit on this fluctuation in prices. The impact of speculation on falling or rising prices is significant. In the above period, the number of “price fluctuations” has almost doubled in comparison with the previous period.