2. Materials and Methods
Two kinds of data sources were needed for the study. The first was statistical data from Eurostat, FAOSTAT and Statistics Estonia, the second considered the data for the landholdings of agricultural producers. This information source is the Estonian Agricultural Registers and Information Board (ARIB).
Data from Eurostat (https://ec.europa.eu/eurostat/
) is used to compose the overview of agricultural land use in European countries, including data about utilised agricultural land use, the number of farms and average utilised agricultural land area per farm. The Eurostat data is from the years 2005, 2007, 2013 and 2016. However, the figures mainly present the changes between the years 2005 and 2016. In two cases (Croatia, Italy) the data was incomplete and data from 2007 or 2013 had to be used. The year 2016 or 2013 was used as the base year for calculating the changes that took place in the area of utilised agricultural area, number of farms and average utilised agricultural land area per farm. Eurostat’s mission is to provide high-quality statistics for Europe.
Eurostat defines utilised agricultural land as follows:”Utilised agricultural area, abbreviated as UAA, is the total area taken up by arable land, permanent grassland, permanent crops and kitchen gardens used by the holding, regardless of the type of tenure or of whether it is used as a part of common land”. Farm is defined as a single unit, both technically and economically, operating under single management and which undertakes agricultural activities within the economic territory of the European Union, either as its primary or secondary activity. Other supplementary (non-agricultural) products and services may also be provided by the holding.
Data from FAOSTAT (http://www.fao.org/faostat/en/#data
) is also used in this study to provide an overview of agricultural land use in European countries. The FAOSTAT data is from years 2005 and 2016. The base year for calculating the changes in the area of agricultural land was 2016. It was necessary to add FAOSTAT data to this study because it differs a bit from Eurostat data about the utilised agricultural land area. FAOSTAT defines the agricultural land area as land used for the cultivation of crops and animal husbandry. The total of these areas falls under “Cropland” and “Permanent meadows and pastures”.
Statistics Estonia (https://www.stat.ee/about
) defines an agricultural household as a unit with uniform technical and economical management and at least one hectare of agricultural land, or where agricultural products are produced primarily for sale (irrespective of land area). From 2007, agricultural households are also units where agricultural products are not produced but the land is being conserved in good agricultural and environmental conditions. Agricultural land area in use is land that is used for agricultural production or being conserved in good agricultural and environmental conditions by agricultural households in the reference year.
ARIB data (ARIB is responsible for delivery of national and the EU subsidies for agricultural activities) from 2011 and 2016 is used for the case study to present a more detailed overview of the recent changes in the pattern of agricultural landholdings in Estonia. Figure 1
illustrates the study area and its location in Europe.
The data from the ARIB Field Register is used for the study. The Field Register is one of three registers in the charge of ARIB and area support is one of the subsidies that ARIB delivers. The digitalised database of agricultural plots is required for payment of area support from the budget of the EU. In the process of delivering national and EU subsidies, ARIB collects information about the applicant (every applicant gets an ID number) and land that is filed for area support.
ARIB data about the agricultural land area and the number of producers were analysed in order to get an overview of changes in Estonian agricultural land users’ landholdings. Agricultural land users and land area per producer was summarized using GIS software ArcGIS (version 10.4). Producers were divided into six groups according to the size of their landholdings: 0–<2 ha, 2–<40 ha, 40–<100 ha, 100–<400 ha, 400–<1000 ha and >1000 ha, data was taken on the basis of these size groups. The basis for this division comes from Farm Accountancy Data Network (FADN) (https://maainfo.ee/index.php?page=9&
) where agricultural land area is divided into four size groups (0–<40 ha, 40–<100 ha, 100–<400 ha, >400 ha). In order to get a closer look at the smallest agricultural land users, FADN size group 0–<40 ha was divided into size groups 0–<2 ha and 2–<40 ha. FADN size group >400 ha was divided into size groups 400–<1000 and >1000 ha in order to characterise the largest agricultural land users.
This study concentrates on agricultural land users’ land holdings that cover all plots which are used for agricultural production in Estonia. No distinction is made between land held in ownership and leasehold land. Also, no differentiation was made between different production groups.
The resulting changes in the utilized agricultural area in Europe (Figure 2
) are diverse, increasing as well as decreasing in many European countries. A possible direction for this indicator needs future studies. However, it is to be expected that in some countries, agricultural land use has been transformed into other uses. For example, the Czech Republic and Poland have decreased the utilized agricultural land area and the studies [38
] confirm that changes of agricultural land use to another use, for example for urban needs (dwellings, infrastructure objects, businesses, commercial and retail areas) is problematical. The number of farms in Europe has decreased in all countries (Figure 3
) except for Ireland. The average utilized agricultural land area (ha) per farm increased in almost all countries except Italy and Cyprus (Figure 4
). That means that despite a decrease in a utilized agricultural area in some countries (Czech Republic, Germany, Poland) there was an even greater decrease in the number of farms, so that average utilized agricultural land area (ha) per farm has actually increased.
The Estonian case presented here that the area of utilized agricultural land has remained almost the same or has increased slightly (Figure 5
). The number of landholdings decreased nearly 3 times within 15 years (Figure 5
) while the area of agricultural land use per household increased almost 4 times (Figure 6
). While average land use per agricultural household in Estonia has increased, the agricultural land in Estonia has become increasingly concentrated into the hands of corporate bodies (Figure 7
). Corporate owners held approximately two times more hectares of land in 2016 compared with the year 2001. At the same time, agricultural land used by self-employed workers is decreasing. It suggests that corporate bodies are growing at the expense of agricultural land used by self-employed workers, the reasons for that need further studies.
The deeper case study with the Estonian AIRB data affirms the previous data that the total number of land users has decreased while the utilized agricultural area increased. The total number of agricultural households in Estonia has dropped (Figure 5
) and households that have closed their businesses are mostly in size groups 0–<2 ha and 2–<40 ha (Figure 8
b). The biggest growth in the number of households between 2011 and 2016 appears in size group 100–<400 ha. The number of self-employed workers in Estonian agriculture has decreased while there has been a growth in corporate bodies (Figure 7
). At the same time, there has also been a growth in agricultural household number in size groups over 40 ha (Figure 8
). In 2016, most of the self-employed workers are using land in size groups 0–<2 ha and 2–<40 ha while corporate bodies form the majority in size groups over 40 ha (Figure 9
). There are also some self-employed workers that use agricultural land in size group 40–<100 ha and a few in 100–<400 ha. Land users in size groups over 400 ha are mostly corporate bodies.
The data presents the changes that happened in the agricultural land use and land users sector in Estonia. These changes have taken place within a short time period, only fifteen years (2011–2016). The agricultural land has steadily been concentrated and, at the same time, more land users are corporate bodies. Additionally, it can be firmly stated, according to this study, that while the number of small land users has decreased, the number of larger land users has increased.
Scientists and official documents [6
] have presented the case for smaller vs. larger agricultural producers: smaller farms perform essential tasks in rural society. However, it is also shown that smaller producers are under greater economic pressure. They often need support from the state [3
]. If this issue is developed only under free-market rules, then the small agricultural producers will shut down their activity. The people who were engaged in small production remain without income and the state must pay the subsistence allowance. The other alternative is for farm labourers to move to find work—normally to the city or towns.
It is important to think beyond the land-use issue to the ownership issue as well. Will the changes in land use pattern bring together changes in the land ownership pattern? This paper addresses the changes in agricultural land use looking at the size of landholdings. It did not distinguish between land that is owned or leased by agricultural producers. It could be that bigger landholdings bring together a concentration of land ownership as well. Agricultural land users get subsidies from the EU. Land users which have bigger holdings receive larger subsidies that enable them to acquire land plots, as is pointed out in documents compiled by the European Economic and Social Committee [8
] and requested by the European Parliament’s Committee on Agriculture and Rural Development [7
The question is, is there a need for regulations about land use and/or ownership? Some countries limit land ownership. For example, it is possible to own 500 ha of land in Lithuania and 300 hectares in Hungary [34
]. Limits for land ownership or use are absent in Estonia. It is theoretically possible for a person with enough money to acquire as much land as is available on the market. The largest land user in Estonia consists of more than 5000 ha of agricultural land, while 146 owners use more than 1000 ha in 2016. The number of such large land users is increasing—it was 126 in 2011, their number in five to ten years is not predictable.
The instructions issued during the Soviet period assigned the optimal agricultural land area for kolkhozes and sovkhozes: 4500–6500 ha agricultural land for kolkhozes or sovkhozes [23
]. The larger land user in Estonia used the optimal amount of agricultural land (5523 ha) according to these instructions. However, compared to previous use, the kolkhozes or sovkhozes land use in the Soviet period was more compact compared to the current agricultural producers’ landholdings. The land reform implementation resulted in land fragmentation, as the previous kolkhozes and sovkhozes were divided among many private owners [25
]. Recent agricultural producers must acquire land plots from the land market, thus land holdings are scattered [33
]. The area of landholding is comparable or even higher than in the eastern EU member states that, after land reform, became corporate farms [9
] but the landholdings are more scattered. It means that current land users need more agricultural land for affordable production to compensate for the costs of plot fragmentation. As a result, landholdings will exceed the area that had been used previously by kolhozes and sovkhozes.
Questions about the scale and equitable arrangement of future agricultural land ownership remain. There were two major land reforms in Estonia (1918 and 1991) the purpose of which was to share land holdings between farm owners (mostly German in 1918) and those Estonians who worked the land. Similar examples can be found elsewhere. Now, however, the advent of much larger-scale production, though economically more efficient, also means the concentration of ownership into fewer hands at the expense of small landholders. The resulting imbalance and related societal disruption to rural life and development raise issues that may need to be addressed.
A recent example is from Scotland, where the Government declares: “We are improving Scotland’s system of land ownership, use, rights and responsibilities, so that our land may contribute to a fair and just society while balancing public and private interests.” [41
]. They are undertaking land reform, as land ownership is in the hands of a very small number of persons, not the best circumstances for society and rural development.
Estonia needs policy direction and regulations for the agricultural land market that help to mitigate the impact of land concentration in rural areas in the long run, similar to several other European countries [34
]. The direction of the policy and extent of the area of land use or ownership is a matter for further research and even debate, to determine appropriate regulations and possible limitations to land areas, e.g. to 300, 500, 1000 or even more hectares.
The study presents the changes – both increase and decrease - in the utilized agricultural land use in Europe and Estonia. The number of farms decreased while the average utilized agricultural land area (ha) per farm increased in almost all countries in Europe. The decreasing number of agricultural households and almost constant agricultural land area in Estonia shows that average land use per agricultural household has increased. Deeper analyses show that agricultural land in Estonia has become increasingly concentrated into the hands of corporate bodies, that growth has come at the expense of agricultural land used by self-employed workers. These changes have taken place within a short time period and may have been a result of notable change in land relations, after implementation of the post-Soviet land reform. Accordingly, conditions in the agricultural sector should stabilize and such extensive changes should not be the norm in the future.
This paper’s aim is to discuss changes in the agricultural sector from the aspect of land use and encourage scientific discussion about the effect of the resulting changes in rural areas. For the discussion to be productive, it needs additional data about the situation in EU countries. As demonstrated, the statistical databases Eurostat and FAOSTAT can provide a range of relevant information in various countries. As the ongoing process of land concentration continues, these changes must be studied more, as there are diverse drivers causing changes in the agricultural sector. Further study must focus on the need for the policy direction and regulations that can mitigate the potential threats that can occur with the land concentration threatening the rural areas. For broad-based statements, input from researchers in different fields is essential. The land holdings should be suitable for necessary and sufficient agricultural production at affordable costs, acceptable to local societies, while also supporting sustainable development. Definitely, the issue is complex. Appropriate solutions cannot arise without further attention.