Organic and conventional production in Slovakia: Comparison of selected managerial and financial indicators
2014
Jana Kozáková | Drahoslav Lančarič | Radovan Savov | Marián Tóth
The paper addresses the issue to compare organic and conventional agriculture from two points of view. Firstly the managerial point of view examing number of employees and the personal costs per hectare, secondly the owners' view examing profitability of organic farming. Both views result from the specifics of organic farming. Organic production should generate higher employment, higher personal cost and results in lower yields. We evaluated differences between organic and conventional farms in Slovakia over period of years 2009-2012 on a sample of more than 1050 farms in each year. The share of organic farms was 15%. Using t-test as evaluation method we found no significant differences from the managerial point of view (measured by employees per hectare and personal costs per hectare). From the owner' s point of view (measured by return on costs, return on equity and total assets per hectare) we conclude that the subsidies successfully compensate the lower revenues of organic farms (there was no significant difference in ROE and ROC). Our results are based on the sample of organic farms with Average utilised area of 850 hectares and reflect the farm structure in Slovakia. We can conclude that large organic farms do not support employment in rural areas and generate comparable profit when compared to conventional farming.
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