Roughly 90% of Romanian farms are under 5 hectares, making cooperative involvement crucial for the development of the agricultural sector. Despite that, Romania continues to have a weak drive to work in associations/cooperatives. Fortunately, the younger generation seems to be less fearful, focusing more on the advantages rather than on the possible risks of cooperation. A Romanian farmer interview discloses current challenges.
The importance of associations/cooperatives
Agricultural cooperatives and associations are central to the EU farming sector, with over 22,000 entities holding major market shares in many European economies - up to 83% in the Netherlands, according to COPA-COGECA.
Roughly 90% of Romanian farms are under 5 hectares, and the country is known for counting the largest number of farmers in the EU. Many of them are small farmers, with little value for the country’s general economic figures, but with high importance for the local economies, the liveability of rural areas, for biodiversity and nature conservation. Association should be crucial for their existence. However mistrust in the concept of working together is still wide spread.
“Farmers are reluctant to form associations out of fear”
In a recent interview with Revista Ferma (“Farm Magazine”), dairy farmer Iosif Colţea speaks out on this subject. Farmers’ association remains a sensitive issue in Romanian agriculture, despite the obvious advantages it offers. Iosif Colţea speaks about the difficulties encountered in trying to build a functional cooperative.
In his view, farmers’ reluctance has deep roots in the past. “The legacy of the communist era still leaves its mark on the mindset in rural areas, where many producers prefer to remain independent, avoiding any form of association. Mistrust and the fear of losing control over one’s own business are still present, and this slows down the development of strong collective structures,” Colţea believes.
The “Ruris Amator” Cooperative
Despite these obstacles, the dairy farmer from Covasna County*, took the step toward association and founded the “Ruris Amator” agricultural cooperative. Founded about five years ago, the organization started with just six members and now has 22 farmers. The cooperative has become a real instrument for the development of its members. One of the most significant outcomes of this association was securing a European project worth 1.8 million euros. “Thanks to the large number of members, the cooperative received a favorable score and 90% funding, which enabled the purchase of modern equipment made available to all participating farmers,” went on Colţea.
*Covasna County, in central Romania’s Transylvania region, is known for its forests, mineral springs, and agricultural traditions, in dairy among others.
No easy ride
However, the road was not an easy one. According to the farmer, convincing other producers to join the cooperative was a difficult process. “A lack of trust and fears regarding the obligations imposed by membership were the main obstacles,” he noted. One of the conditions that discourages many is the requirement that at least 50% of production be sold through the cooperative. “Although this rule can bring economic benefits, many farmers perceive it as a restriction, preferring to retain the freedom to sell individually,” notes Colţea. At the same time, the mindset plays a key role. While older farmers are generally reluctant, young people entering agriculture are much more open to collaboration and understand the long-term benefits of joining a cooperative.
Cooperation, the key to a more stable future
Even though the process is difficult, Iosif Colţea remains convinced that cooperation is essential for the future of Romanian agriculture. “The benefits are obvious, from access to financing and cost reduction to increased bargaining power,” he states. For this model to expand, however, a shift in mindset is needed, as well as an economic environment that encourages cooperation, not fragmentation. [Full article, in Romanian available at: https://revista-ferma.ro/iosif-coltea-fermierii-nu-se-asociaza-din-teama-iar-procesatorii-profita-de-dezbinarea-noastra/].
Only 36% of all cooperatives have a turnover greater than 0
Oana Ganea, a sociologist at the Romanian Center for European Policies (CRPE), presented a series of concrete data during a conference held last autumn: of the approximately 2,400 cooperatives registered in Romania, just over half submitted their financial statements in 2023; 36% had a turnover exceeding 0 RON, and of these, 60% reported a profit. These figures clearly show that the cooperative sector needs consolidation and professionalization.
Florentin Bercu, Executive Director of the National Union of Cooperatives in the Plant Sector (UNCSV) and Vice President of COPA COGECA, believes that the voluntary association of farmers is the only way Romania can compete effectively in the European single market. He recently reiterated the importance of financial support for young cooperatives. He even recommended that the future post-2027 National Strategic Plan cover operating costs for the first three years and facilitate access to financial instruments, both banking and non-banking.
Association: the way forward
In a country with over 2 million small farms and an extremely fragmented production structure, association seems the logical way forward, the one that gives small and medium-sized farms a chance. Sometimes it is the only chance.
LVVN-Bucharest Team Perspective
Fostering the association process in Romania (and the region) is an important topic which is getting increasing attention by our LVVN-team. It aligns well with our goal to contribute to more resilient and sustainable agri-food chains, together with Dutch agrifood partners (business, knowledge, governmental). We can connect stakeholders and share knowledge and experience. The Netherlands’ long-standing expertise in the field of association/cooperation has contributed to a highly competitive sector and can offer valuable insights for Romania’s way forward.