Relations between prices, subsidies and income in various economic size farms

Cezary Klimkowski

Abstract: Аgriculture is considered to be a risky business. Among many different kind of risk that make farm income volatile, price risk is the most significant. The aim of the paper is to answer the question to what extent agricultural commodity prices influence farm income. Using FADN data from selected EU member states about farmers’ income the author found out that there is high correlation between key agricultural commodity prices and farm income. However there are significant differences among various EU member states, different types of production, economic size of farms. It was also proven that income-price correlation is higher for bigger farms.

Keywords: EU agriculture; farm income; price risk

Date published: 2018-02-02