Real Income from Agriculture – second estimate, Slovenia, 2020
In 2020, the real factor income per AWU in agriculture expected to increase by 6% over 2019
According to the second estimate, factor income is expected to increase in 2020 as a result of crop and animal volume increase. A price decrease is expected in both production areas. Production costs are expected to decrease due to the lower input prices.
Factor income in agriculture increased in comparison with the poorer 2019 economic results
Compared to 2019, in 2020 a 5% increase in the real factor income in agriculture is expected. The reason for the difference between last year’s and this year’s income from agriculture is the comparison with the poorer 2019 harvest. Especially low was the harvest of fruit and grapes, which influenced the agricultural production value and all income indicators. Factor income increase in 2020 was influenced by higher value of agricultural production and by the assumption that the subsidies value will stay at the previous year’s level in nominal terms and decline by 2% in real terms. Factor income was influenced also by lower production costs as a consequence of the lower prices of some important inputs. The factor income per annual work unit is expected to increase by 6% due to a slight decrease in employment.
In 2020, higher volume but the prices of agricultural products on average lower
According to the second estimate, the value of the agricultural output in 2020 is expected to amount to EUR 1,353 million and thus remain at the previous year’s level. The volume is expected to increase by 9% and the prices to decrease by 8%.
Higher crop output value due to the higher volume and lower prices
Crop value is expected to increase by 4% due to the volume increase by 15% and the price decrease by 10%. In comparison with the previous year, the higher values are expected in production of cereals, industrial crops, potato, vegetables, and fruit, where it should be noted that the 2019 harvest we are comparing it to was one of the worst. Higher values in all above mentioned fields are the result of higher quantities and lower prices.
The value of fruits is expected to increase by a half compared with the poor 2019 harvest; prices are expected to be lower by more than a tenth. The value of industrial crops is expected to increase due to the volume increase by 7% and lower prices by 2%. The value of cereals is expected to increase by a tenth due to the substantial volume increase despite the lower prices than in 2019. The potato value is expected to increase by more than a tenth due the volume increase by almost a third despite the price decrease by more than a tenth. The vegetables output value is expected to increase due to the price decrease and the 8% volume increase. The output value of forage plants is expected to decrease due to the price decrease despite the volume increase.
The largest crop value decrease is expected for grapes and wine, where the value is expected to be almost a fifth lower than in the previous year; the reason for the decrease is almost a fifth lower prices despite slightly higher production.
The animal output value lower despite the slight volume increase due to the price decrease
According to the estimate, the animal output is expected to decrease by 5% due to the 6% price decrease despite the slight volume increase.
The value of animals in 2020 is expected to decrease by 5% mainly due to the 6% price decrease, while the volume remains close to the previous year’s level. Lower prices are expected by all important kinds of animals, including pigs. The result of the lower prices is the decreased value of animal output. The largest decrease in output value is expected for cattle (by 7%), the price of which will decrease by the same percentage. The output value of pigs is expected to decrease by 4% due to the price decrease. The output value of poultry is expected to decrease by 4% due to the 7% price decrease despite the 3% volume increase.
The animal products output is expected to decrease as well. The output value of milk is expected to be lower than in the previous year due to the price decrease by 4% despite the expected increase of milk production. The eggs output value is expected to decrease slightly in comparison with 2019.
Lower production costs due to lower input prices
The value of intermediate consumption is expected to decrease by 4% in real terms. The volume is expected to remain almost at the previous year’s level, while the prices are expected to decrease by 4%. Substantially lower costs are expected for energy (by 15%) and fertilisers (by 9%). Lower costs are expected also for feedingstuffs, seeds, and veterinary services. The costs of other input items are expected to remain the same or be slightly higher than in the previous year.
Slight employment decrease
Compared with the previous year, it is expected that in 2020 employment will decrease by 1%.
Annual changes of the main agregates in agriculture, Slovenia, 2020
1) The deflator is the implicit price index of GDP at market prices. According to Eurostat data is 102.071295 for the year 2020.