Sustainability Assessment of Farms Managed by Young Farmers in Cyprus ^†

Abstract

Generational renewal (GR) is a core objective of the EU Common Agricultural Policy. This study evaluates the sustainability of farms operated by Cypriot young farmers, established during 2004–2022. Primary data were collected via a structured questionnaire, and sustainability indicators were calculated across the three sustainability pillars. Findings show that young farmers are profitable regardless of subsidies, though modernization does not necessarily improve productivity. Satisfaction with the “Start-up aid” Measure is moderate, highlighting the need for more targeted interventions to strengthen sustainability and support GR.

1. Introduction

The sustainability of young farmers in the EU and the impacts of the Common Agricultural Policy (CAP) have been examined from economic, social, or environmental perspectives [1,2]. Few studies have quantitatively explored the interaction between CAP measures and all three sustainability dimensions simultaneously, particularly through the use of primary data. This study seeks to address this gap by employing Cyprus as a case study. While some researchers argue that CAP subsidies may compromise sustainability [3], others report beneficial effects [4]. These divergent findings highlight the need for an integrated assessment.

This study provides the first assessment of the sustainability of farms operated by young Cypriot farmers established between 2004 and 2022, alongside an evaluation of the effectiveness of the CAP Measure “Start-up Aid for Young Farmers”. Primary data were collected through a structured questionnaire covering selected sustainability indicators, farmer satisfaction, and perceptions of generational renewal (GR). The findings suggest that, although young farmers are generally profitable, approximately 14% exited farming during the study period. Satisfaction with the Measure is moderate, with limited evidence of its effectiveness in attracting new entrants or enhancing farm productivity.

2. Materials and Methods

An indicator-based approach was applied to meet the study’s objectives. Primary data were collected via a structured questionnaire to calculate selected sustainability indicators [5]. Likert-scale questions assessed farmers’ satisfaction with the Measure and their perceptions of its contribution to GR, while correlation analysis was subsequently conducted to examine the relationships among the sustainability indicators.

The study is based on a representative sample of 140 Cypriot farmers who were established through the Measure during the period 2004–2022. After excluding 19 farmers who had exited farming, the final sample comprised 121 farmers. This paper focuses on eight key farm types (FTs), classified according to the main production sector’s contribution to gross income: cereals/fodder (FT1), potatoes (FT2), open-field vegetables (FT3), greenhouse vegetables (FT4), permanent crops (FT5), mixed cropping (FT6), sheep and goats (FT7), and dairy cows (FT8).

3. Results and Discussion

The majority of farmers in the sample are male (88%), with an average of 13 years of formal education. Approximately 81% are engaged in farming on a full-time basis, and 91% are successors within family farms, indicating a limited attraction of new entrants. The average utilized agricultural area is 29 ha, of which 56% is irrigated and 65% is rented. Farm operations require, on average, 3.4 annual work units (AWUs).

Environmental sustainability varies across FTs (

Table 1. Farm sustainability performance.

Indicator (unit)	Farm Type
	Total	FT1	FT2	FT3	FT4	FT5	FT6	FT7	FT8
	n = 121	n = 10	n = 14	n = 10	n = 17	n = 16	n = 9	n = 23	n = 12
Environmental Pillar
Crop intensification 1 (k€/ha)	14.24	1.00	6.42	16.32	35.22	3.82	1.82	10.81	16.68
Livestock density (LU/ha) (ratio)	1.18	—	—	—	—	—	—	3.63	5.04
Social Pillar
Employment contribution (AWU/ha)	0.8	0.1	0.3	1.3	3.0	0.5	0.1	0.2	0.1
Hired labor 2 (%)	43.9	17.4	37.5	45.7	63.7	27.2	34.5	47.4	64.8
Participation in POs (% farms)	40.5	40.0	57.1	30.0	47.1	6.3	55.6	39.1	66.7
Salary level 3 (ratio)	1.43	1.63	2.55	2.35	0.58	0.52	0.73	−0.29	2.70
Economic Pillar
Labor productivity 4 (k€/AWU)	26.31	44.73	35.98	31.30	10.39	9.35	15.47	9.34	49.14
Modernization 5 (k€/AWU)	6.13	10.54	2.57	2.46	4.40	2.62	3.57	7.48	14.35
Economic efficiency 6 (ratio)	0.99	0.89	1.46	1.48	0.77	0.73	0.76	0.81	1.14
Capital efficiency 7 (%)	3.4	1.2	12.9	14.7	−3.5	−2.1	0.6	−1.7	3.6
Net profit with subsidies (k€/farm)	37.61	−5.74	48.36	123.61	−12.61	−7.96	−4.39	−6.56	47.76
Net profit without subsidies (k€/farm)	27.60	−27.35	45.73	116.93	−14.82	−10.31	−17.48	−29.88	34.47
External inputs dependency 8 (%)	48.2	39.7	54.4	45.4	46.8	29.5	41.1	57.2	65.0
Subsidies dependency 9 (%)	7.7	20.8	2.7	5.4	3.7	9.2	22.3	8.8	1.3
Off-farm income 10 (%)	24.5	36.9	24.6	17.5	18.3	45.0	44.1	13.9	12.5

UAA: Utilized Agricultural Area; AWU: Annual Work Units; POs: Producer Organizations; ¹ External inputs costs/ha; ² Hired/total labor costs; ³ Return to labor per AWU/minimum legal wage; ⁴ Farm income/AWU; ⁵ Fixed assets depreciation/AWU; ⁶ Benefit–cost relation; ⁷ Rate of return to total capital; ⁸ Cost of external inputs (fertilizers, pesticides, feedstuff, etc.)/total costs; ⁹ Subsidies/gross income; ¹⁰ Off-farm income/household income.

). FT4 shows the highest crop intensification (35.22 k€/ha). Livestock density in FT7 and FT8 (3.63 and 5.04 LU/ha) exceeds both the sample (1.18) and EU average (0.7), indicating environmental pressure [6].

Regarding social sustainability, employment contribution is highest in FT4 and hired labor in FT8. Participation in Producer Organizations (POs)—important for sustainability—is the lowest in FT5, highlighting challenges for permanent crop producers. Salary levels in FT4–FT7 fall below 1, suggesting reliance on off-farm income to meet basic needs [5].

Concerning economic indicators, labor productivity ranges from 9.34 (FT7) to 49.14 k€/AWU (FT8). Modernization is highest in FT1 and FT8, which also show the highest labor productivity. However, no significant correlation (r_s = 0.04, p > 0.05) exists between them, suggesting modernization does not always improve labor productivity [7]. Additionally, trade-offs were observed with land (r_s = −0.22, p < 0.05) and capital productivity (r_s = −0.27, p < 0.01).

Economic efficiency is below 1 for most FTs, raising concerns for sustainability. Capital efficiency is well above average only in FT3 (14.7%) and FT2 (12.9%), with no correlation with modernization. Net profit averages 37.6 k€/farm, dropping to 27.6 k€/farm without subsidies, indicating overall profitability.

External input dependency averages 48.2%, peaking in FT8 (65%) mainly due to purchased feedstuff, highlighting market vulnerability [5]. FT6 shows the highest subsidy dependency (22.3%), reflecting lower market orientation. Economic and capital efficiency are negatively correlated with subsidy dependency (r_s = −0.46, p < 0.01; r_s = −0.25, p < 0.01), raising questions about the effectiveness of CAP subsidies in enhancing sustainability [8].

Off-farm income supports household livelihoods, especially in FT5–FT6, where it exceeds 44% of total income. Livestock farmers (FT7–FT8) are less reliant on off-farm work, as shown by the negative correlation with herd size (r_s = −0.23, p < 0.05).

Young farmers’ satisfaction with the Measure averages 3.07, with the highest value in FT3 and lowest in FT7 (

Table 2. Young farmers’ perceptions.

Variable	Farm Type
	Total	FT1	FT2	FT3	FT4	FT5	FT6	FT7	FT8
	n = 121	n = 10	n = 14	n = 10	n = 17	n = 16	n = 9	n = 23	n = 12
Satisfaction with the Measure a	3.07	3.10	3.07	3.80	3.18	3.13	2.67	2.65	3.17
Measure’s contribution to youth attractiveness and generational renewal a	3.08	3.00	2.79	2.80	3.18	3.25	3.11	2.91	3.25
Farming engagement even without the Measure (%)	62.0	50.0	64.3	70.0	70.6	62.5	55.6	60.9	50.0
No occupational change post-Measure (%)	71.9	90.0	42.9	80.0	70.6	75.1	78.1	69.6	66.7

^a Scale: 1–5.

). The Measure’s contribution to GR averages 3.08. Notably, 62% of the farmers would engage in farming irrespective of the Measure and 71.9% intend to remain after completing the Measure’s commitment period.

4. Conclusions

This study assessed the sustainability of farms managed by young farmers in Cyprus and examined their perceptions of the CAP Measure “Start-up Aid for Young Farmers”. The results indicate that, on average, farms are profitable, although substantial variation exists across FTs. Satisfaction with the Measure is moderate, and its effectiveness in attracting new entrants or enhancing productivity appears limited. The findings highlight the need for more tailored interventions to strengthen farm resilience and support GR. They also provide useful insights for benchmarking and policymaking. Future research will focus on the development of composite sustainability indicators and the identification of key drivers of both sustainability and farmer satisfaction.