Hungary Newsflash Week 31

COVID-19 fallout & subsidies, infrastructural development, flood damages - The last week in Hungarian agriculture

Dear reader,
Due to summer vacations, the Hungary Newsflash will be published less frequently in August.
A woman walking in a wheat field
©Oleg Makievski
The summer of 2020 has so far been just as chaotic and mercurial as the spring before it - Policymakers have to count on longer droughts and a more uneven distribution of precipitation in the coming years.

€723 thousand for equine breeding subsidies

Yet another sector was affected by the COVID-19 pandemic – The equine breeding business, which suffered the economic blow through losses that travelled up the business chains. Equestrian sporting events have been cancelled this season, tourism completely shut down due to the pandemic, which led to losses in the equine husbandry sector.

The Ministry of Agriculture has announced a new subsidy scheme in order to aid the horse breeding business. The package is worth €723 thousand in total, and breeders can apply for a subsidy of €231 per animal. The details of the program will be later announced by the Treasury.

€58 million in infrastructural subsidies in Kiskunság

In order to further increase the domestic food chain security following the COVID-19 crisis, an overarching subsidy plan worth €58 million will be soon launched for infrastructural development in the Homokhátság (Sand Dunes) area of the Danube-Tisza Interfluve region of the Great Plains, Minister for Agriculture István Nagy announced on Tuesday.

€12.7 million will be spent on developing irrigation infrastructure over an area of 1.5 thousand hectares, raising the water storage capacity in the area to 1.4 cubic meters. The new infrastructure will have a more sustainable design and instead of tapping into the finite underground water resources in aquifers, it will instead rely on surplus river water from the River Tisza.

€17.36 million was allocated for a new processing and packaging plant near Mórahalom, and €34.7 million will be spent on a new geothermic-powered fruit and vegetable cold storage facility which will have mechanized cleaning, classification, packaging and labeling lines.

The Minister also reported that a subsidy package of €86.8 million is in the works now for the purpose of supporting greenhouse and cold storage development in domestic horticulture, and there are also plans for a package of €15.9 million for individual and family entrepreneurs in vegetable and fruit production.

Government: Irrigated area to be increased by 100 thousand hectares by 2024

State Secretary Attila Szinay of the Ministry of Agriculture announced that the government aims to increase the irrigated agricultural land area in Hungary by 100 thousand hectares by 2024. According to the irrigation development act that entered into force on January 1, producers have to organize irrigation communities, which can apply for irrigation water licenses. A condition for water licenses for irrigation communities is a total 100 hectares of farmland for field crops or 10 hectares for horticultural fruit and vegetable production.

The State Secretary also commented that due to climate change and the increasingly uneven distribution of annual precipitation, the largest share in the central agricultural damage compensation fund goes to drought damages.

According to State Secretary Szinay, so far 14 thousand producers applied for irrigation subsidies for 266 thousand hectares of farmland. The total subsidy budget for irrigation is €144.7 million, out of which €52 million has already been awarded and €12.4 million has been paid.

A field after harvest in Hungary
©Dr. Éva Ütő
A field after harvest in the Great Plains. The infrastructural developments in the region will mean an increase in irrigated area, the establishment of new support facilities and greenhouses.

Summer flash floods

Due to the summer rains of the past days, flash floods hindered agricultural works in various parts of the country. In Zala county, Western Transdabunia, the floods broke through dams and breached barriers around fisheries, as well as damaged roads and bridges, halting the harvest of winter barley, fall wheat and rapeseed.

In Somogy county, the flood reached previously unprecedented levels, and the flood measuring meterbars had to be extended to be able to record water levels. In the village Rinyaújnép, due to the flooding of the Rinya Creek, a flock of thirty sheep had to be rescued by a team of firefighters, and in Somogy and Zala counties, entire villages were flooded. “Damn it let’s just evacuate,” said Imre Paulin, municipality council member in Liszó to his brother as they tried to save their belongings from their family house – Mr. Paulin later aided his fellow villagers in trying to save family homes as the nearby fishing lakes breached their dams and flooded the village.

The last week’s rain also degraded the remaining wheat in the fields, which had already been hit hard by the spring drought, which means that flour wheat prices will increase even further this summer.

Tobacco business also hit by COVID-19

In a meeting between tobacco industry stakeholders organized by the tobacco fermenting company Dofer Zrt., President of the Hungarian Tobacco Producers Alliance Illés Bényei reported to the news agency MTI that tobacco production suffered multiple blows this year in Hungary. Due to the COVID-19 crisis, plant protection material prices doubled this season, increasing input cost and also, after the sewing period, the pandemic presented a serious labor shortage problem. In the spring, tobacco plantations were also hit with frost damages, and in the early summer period, the colder weather was unfavorable for growing tobacco plants. Later, the rainy period caused flooding problems, but in certain places, even sandstorms caused varying degrees of damages.

Just how much the hardships of the season will have affected tobacco yields will be clear later in the harvest, around August. In 2019, Dofer Zrt. Alone procured 1400 metric tons of Virginia and 206 tons of Burley tobacco.

Although the land area dedicated to tobacco production in Hungary has shrunk over the past two decades, annually around 4-5 thousand hectares of land are sown with tobacco, and at least seven thousand families depend on this small industry, 77% of which is concentrated in Szabolcs-Szatmár-Bereg county in Eastern Hungary.

Photo credit:
Cover picture:
“close to nature” by Oleg Makievski, via Flickr.