Agriculture

Romania’s natural environment is appropriate for the development of all farming branches. Two thirds of its territory are covered by plains and hills, with smooth slopes, fit for mechanized farming, with fertile soil and favourable climate.

Arable land totals 9.4 million hectares, or 63.5% of the country’s area. Of it, more than 2.9 million hectares are laid out for irrigation. Pastureland covers around 4.9 million hectares and 264,000 hectares are under vineyards (actually, Romania boasts some famous vineyards), orchards, vine and tree nursery gardens.

A more suggestive image of the Romanian farming potential is given by the share it holds in Europe’s farm and arable area: almost one quarter of the aggregated farmland of the Central and East-European countries and 10.65% of the EU farmland, and 23% and 12.6% respectively, of the arable land.

The Land Law, promulgated as early as 1991, redeemed the land to its rightful owners or to their descendants, thus bringing a new motivation to revigorate agriculture.

The total agricultural area in private hands – farms with legal status, family association individual farmsteads – was 12,140 thou. hectares in the year 2000. There is also a number of state farms, about to be privatized.

The Farmers’ Association of Romania includes agronomists, who have developed successful farms, overcoming the difficulties agriculture is facing. They are not few, but not as many as they should have been, if the structures, economic relations, legal framework had been settled earlier. Some started from scratch, taking, in 1992-1993, from the former Romcereal loans without guarantees, just on contracts of produce supply. At the same time, they also took land on lease from various owners, as it happened in the Baragan Plain. When the Romanian Government endorsed a decision whereby bank credits were granted at an interest of 15% for equipment purchase, they jumped at the opportunity. With EBRD credits run through the Agricultural Bank, equipment was bought, even imported.

The Rural Credit Guarantee Fund was constituted, meant to guarantee medium- and long-term credits given by merchant banks for investments in agriculture and food industry. The European Union extended at that time 9 million ECUs addressed to private investors in Romanian agriculture, petty investors in particular, for the purchase of farm machinery, small farms and small slaughterhouses. Likewise, the Fund provides guarantees to those who run imports of equipment for agriculture or food industry.

The reform of the farm-food sector

Agriculture is a national strategic priority of Romania’s socio-economic development. The implementation of a substantive reform in agriculture was the agricultural policy priority of the Short-Term Socio-Economic Program of Romania’s Government. A string of measures were taken to the end of easing the inflation pressures without endangering the agricultural production. We should mention among them:

a) encouraging the agricultural production (including the suspension of the agricultural tax);

b) building a land market, encouraging competition and consolidating the rural farmsteads:

putting in possession the owners that are not engaged in litigation and issuing the ownership deeds;
land sale and purchase;
promoting a special program of privatization and restructuring;

c) the reform of the financing system of agriculture:

complying with the requirements of macro-economic stability;

d) promoting programs to create jobs in non-agricultural sectors in the rural localities.

The target of the agricultural and rural development policies is the formation of commercial family farm units by sustaining performance and competition, in view of ensuring food security.

The World Bank gives financial support to projects for the cereal market in Romania, supporting both the restructuring of the distribution systems and the creation of new inter-professional structures that should reshape the commercial mind and behaviour of all operators in the cereal market. Partnership relations are thus being created all along the chain, which will allow for a reform of the markets. the non-government Inter-Professional Organization of Cereals and Oil-Bearing Plants (OICO) represents the professional interests of the private entrepreneurs dealing in the production, storage, conditioning, processing and sales of cereals, oil-bearing seeds and their derivatives. It is about a single partnership structure "on the vertical", so that the direct farm producers, wholesale dealers, processing industries and retail sale dealers may be "on the same side of the barricade".

The strategic plan of short- and medium-term development of Constanta port includes a project of building a cereal terminal with an annual capacity of 4.5 million tons. There will also be built there a combined fodder complex. The World Bank will finance the estimated cost of some 60 million dollars. The terminal structure is planned to include a 120,000 ton cereal silo, a horizontal store of 20,000 tons, loading and unloading berths, a dock fit for ships of up to 60,000 dwt, a railway terminal, spaces to accommodate 2,000 ton barges, etc.

The European Commission has given support for the setting up of services of extension, agricultural consulting and information of the Romanian farmers as concerns the productions, cultivation areas and prices of farm produce.

Plant production

Apples hold the main position within the export of fresh fruits. In terms of quantity, Romania covers some 2.5 per cent of the world export of apples and around 5 per cent of the European export.

Romania is a net exporter of fruit preparations. The major importers include Austria, Germany, Belgium, Canada.

The country’s largest vineyards are to be found in the hilly zones. One zone, stretching from Vrancea county up to east of the Barlad Valley, in Galati county, includes over 50 thousand hectares of vine, more than 80 per cent of which is of superior quality. Famous are the Panciu, Jaristea, Odobesti, Cotesti vineyards and, farther east, also Nicoresti and Ivesti. To the west lies the Dealul Mare region of vineyards belonging to the counties of Buzau and Prahova, with famous centers at Tohani, Mizil, Urlati, Valea Calugareasca, etc., totaling other 25 thousand hectares. There too, superior strains prevail. As a whole, the two big vine-growing regions hold almost a quarter of the country’s viticultural areas.

Farther north, on the Moldovan Tableland, the vine-growing regions in the counties of Iasi and Vaslui boast several famous vineyards: Cotnari, Iasi, Husi. Superior strains prevail also in Dobrogea, especially at Murfatlar, to the north at Niculitel and, to the south, at Ostrov (which produces mainly table grapes).

On the other hand, in the Romanian Plain, where some 32 thousand hectares are under vine culture, hybrids prevail. Except for a few famous vineyards (Dabuleni, Sadova, Segarcea, Plenita), southern Oltenia too, grows hybrids. In terms of quality, important are the vineyards of Dragasani, in the hilly zone, and of Pitesti.

The major vineyards in Transylvania are those of Arad (Pancota, Siria, Ghioroc), the ones in the valleys of Mures and Tarnave rivers (Ighiu, Cricau, Craciunel, Jidvei) and, farther north, the vineyards between Oradea and Satu Mare (Oradea, Diosig, Valea lui Mihai, Marghita).

The wine industry avails of numerous modern wineries, placed in the viticultural areas: Iasi, Cotnari, Husi, Focsani, Cotesti, Valea Calugareasca, Murfatlar, Dragasani, Pancota (Arad county), Jidvei (Alba county) a.s.o.

Animal production

The big cattle stock indicates that the biggest number is grown in the counties of Suceava, Bihor and Cluj, and the smallest – in the counties of Tulcea, Calarasi and Mehedinti.

Pig breeding and pork production prevail in the counties with a major share in cereal cultivation. The private sector keeps holding the first place as regards both the total stock of pigs.

As the embargo on Yugoslavia was lifted, meat exports to that country were resumed. Other buyers were Russia (the main market for export), the Republic of Moldova, the Former Yugoslav Republic of Macedonia, Latvia, Croatia.

In the total amount of meat meant for domestic consumption, fowl holds the second place, next to pork, with a share of 40%.

The Thoroughbreds RA collaborates intensely with the relevant international bodies, seeking the acknowledgement of the Romanian thoroughbreds in terms of lineage. The Romanians are well-known internationally for their Lippizaners, Arabs and Shagya Arabers, and their English horses too, are in the process of acknowledgement. For the time being, though, the Romanians are only invited as observers at the European Trot Union.

The competition triggered in Romania by the liberalization of the milk and dairy products’ prices has led to the elimination of the non-lucrative enterprises (especially those with a majority state capital) involved in the production, processing and distribution of these products. So, in the Romanian market, the main businesses involved in milk purchase are private.

Land improvement

The farmland covered by land improvement operations in Romania is mostly in private hands.

The National Company of Land Improvement currently runs the administration of the land improvement works on most areas. The public institutions, commercial companies, farmers’ associations and other economic operators administrate their own irrigation facilities.

The activity of exploitation of the land improvement facilities generally, and of irrigation ones particularly, is and will still be dependent also on the conditions of development of the private farms, on the interest in cultivating the land with high-yield crops.

As agriculture is seen as a major branch of the national economy, the main targets of the Government of Romania in this domain are to speed up the land reform, to touch the minimal parameters of performance in the farm-food domain required for accession to the EU, to consolidate and develop the private sector by promoting specific investment programs that should be both efficient and advantageous for farmers.

Source: MIP