Economic analysis and development prospects of the crop farming sector in Latvia
2013
Vitola, I., Latvia Univ. of Agriculture, Jelgava (Latvia). Faculty of Economics | Avota, S., Latvia Univ. of Agriculture, Jelgava (Latvia). Faculty of Economics
Agricultural companies are important for creating a stable agricultural industrial complex. Companies are dependent on grain purchase prices and dictate their rules; they should provide a production storage system to reduce these factors maximally. Businesses should also follow very conservative borrowing policies resulting in effective protection against a variety of external factors such as price changes, weather conditions, and national economic policy. The aim of the research is to perform an economic and financial analysis and to assess crop industries as well as to explore their development perspectives. It is possible to increase the area sown with grain in Latvia; mainly in less intensively exploited areas like Pieriga, Kurzeme, part of Vidzeme, and Latgale. Besides, there is a significant potential for increasing crop yields in Latvia compared with the other EU Member States. It is also necessary as far as possible to seek for lower costs to reach the highest possible outcome. The company major risk factors include adverse climatic conditions, unprotected domestic market, unpredictable current asset prices and price increase as well as grain purchase prices - a factor unknown at the time of sowing.
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