EU Agriculture Research Articles

Potential impact of the European Green Agreement on EU and Hungarian crop production

European arable farming, including Hungarian arable farming, faces a huge dilemma: how to contribute to and maintain the global food supply while reducing greenhouse gas emissions while main taining biodiversity, but reducing inputs that are potentially damaging to society and the environment while ensuring that no more land is taken out of production? Not to mention that the increasingly urgent need to tackle climate change is also placing additional demands on EU agricultural decision-makers. Under the European Green Deal (GD), the 'From Farm to Fork' (F2F) strategy will help achieve climate neutrality by 2050, with a target of a 55% reduction in greenhouse gas emissions by 2030. Achieving this will require significant changes in food production, a shift in crop health strategies and accelerated innovation in the agricultural sector. The study addresses these issues. Our first hypothesis (A1) is that the GD and F2F strategies can be implemented without problems and without losses. Our second assumption (A2) is that the know-how solutions and the technological conditions for precision agriculture that are already available exist, and that all of these already justify the feasibility of A1. In order to prove this, we have reviewed recent and up-to-date literature on DG and F2F. For A1, we found that there are pro and con findings in the literature. However, the summary finding is not positive. The conclusion of the studies, based on data calculations, is that EU agriculture faces huge additional costs if it is to maintain production and reduce environmental pressures. Their calculations suggest that more people will be disadvantaged by the decisions, and that millions of euros could be lost to the public. However, the article also shows that there are many cases where positive results can be achieved even with reduced chemical use. Facts and figures from international and Hungarian technological and know-how solutions and their trials at plant level show that the DG's objectives are already partially achievable. It has been established that the systematic use of precision technologies allows to increase the natural and at the same time the economic efficiency. In our work we have used the results of primary and recent secondary research. We have shown the downsides of GD, but also that with targeted support, the objectives of sustainability and GD can be approached. Changes in 2022, drastic price increases for inputs including fertilizers and pesticides, inflation at a 20-year high, energy prices spiraling out of control, and an almost unprecedented drought affecting crop production and horticulture, point to the need for a radical change in technology, thinking and regulation. And all this to ensure that there is enough affordable food in Hungary, that there are export products within and outside the Community, and that those working in agriculture have a decent living.

Sintesis Pupuk Ca(No3)2 dari Limbah Industri Bleaching Earth

Bleaching earth industrial waste is usually disposed of and landfilled in solid waste disposal. This waste is rich in calcium and sulfur content so that it has the potential as a raw material for making Calcium Nitrate fertilizer. This research aims to process bleaching earth industrial waste into calcium nitrate fertilizer which is rich in the macronutrient Nitrogen and the micronutrient Calcium in accordance with EU Agricultural standards. This research method was carried out by reacting the waste with nitric acid at different concentrations, 0.8M; 1M; 1.2M; 1.M; and 1.6M while being heated at different temperatures, at 50℃, 55℃, 60℃, 65℃, and 70℃, using a magnetic stirrer with a stirring speed of 350 rpm. Then filtered to remove impurities with the filtrate. The filtrate is added with ammonium hydroxide, so that a solid is formed and the pH has reached a neutral atmosphere, then it is filtered and left to stand at room temperature. XRF analysis was carried out to add elements contained in the fertilizer and Kjedahl Spectrophotometer to indicate the total N-content. The highest yield was obtained at a concentration of 1.6 M with a yield of 95.4440% with an actual weight of 2.3861 grams with an operating temperature of 70oC and for the best Calcium content, it was obtained at 23.3% with a N-Total content of 0.64% which complies with the EU Agriculture Commission Standard.

Interdependence between Energy Cost and Financial Situation of the EU Agricultural Farms—Towards the Implementation of the Bioeconomy

The concept of a bioeconomy can be an opportunity for agricultural and rural development. The objective of this research is to identify groups of family farms which are able to implement the principles of this new development model based on a bioeconomy and to reduce operating costs, especially energy. The time scope of this study covers the period 2004–2020. The data source is the Farm Accountancy Data Network. On the basis of the values of output, family farm income, cash flow, net investment and total inputs (including energy costs), the classes of family farms are indicated. The ranking is based on geographical criteria and the results of panel data models with fixed effects which measure the relationship between energy costs and production, income, cash flow and net investment according to the economic size of the family farm. The results obtained are discussed within the framework of recommendations of the European Commission.

The Future of Farming: The (Non)-Sense of Big Data Predictive Tools for Sustainable EU Agriculture

The agricultural sector is one of the key sectors that need to be transformed in order to mitigate climate change. The use of predictive models supported by big data (“big data predictive tools”) has already been named in the literature as one key possibility to facilitate this change. This contribution maps out the possibilities and potential harms of big data predictive tools for sustainable agricultural use and analyses the role that regulation can play to address these challenges, answering the following question: how can the EU Common Agricultural Policy (CAP) and the European Green Deal address potential harms of big data predictive tools for sustainable agriculture while safeguarding its possibilities. Based on a combination of doctrinal legal research and a review of secondary sources, this contribution concludes that in theory, both instruments recognize the possibilities of big data predictive tools for agriculture and emphasize the necessity of environmental sustainability in this regard. However, some of the most promising and essential elements of achieving sustainable digitalisation in agriculture, risk not being substantiated because of a watered-down CAP, significant focus on larger farms and strong member state margin of appreciation. Although at first sight the CAP and Green Deal seem aligned, it can be concluded that the depth has yet to be proven. Whether this depth can be substantiated will also determine the extent to which digital technologies, such as big data predictive tools, will help in enforcing a sustainable agriculture or risk intensifying unsustainable practices in the EU.

CAP After 2004: Policy to Promote Development or to Elimination Differences Between Regions? Non-parametric Approach Based on Farm Efficiency in the Old and New EU Regions

In the light of the Treaty establishing the European Economic Community (Treaty of Rome) of 25 March 1957, the primary aim of the Common Agricultural Policy is to provide European Economic Community citizens with adequate amounts of food at reasonable prices and to guarantee farmers a decent standard of living. That is more, the EU fund transfers were to eliminate differences between regions and promote development of individual regions. These aims proved to be particularly important following the EU enlargement in 2004. The indispensible effect of the integration process has been connected with changes in the directions of agricultural production and efficiency of utilisation of individual inputs. Nevertheless, it is difficult to evaluate the effects of the implemented policy based on univariate comparisons. In view of the above, the aim of this paper is to assess the effects of the agricultural policy and the cohesion policy implemented in the EU, focusing on the valuation of the impact of the greatest EU enlargement on this relationship. This goal was achieved thanks to constructing multivariate rankings applying the DEA super-efficiency model for average farms specialising in plant, animal and mixed production in individual EU member countries for two period. The application of the DEA efficiency model makes it possible in the computation process to take into consideration the fact that in the course of agricultural production three groups of products are manufactured involving four basic types of inputs. The starting point for the analyses was provided by data published within the FADN agenda for average farms operating in the countries being the EU members. The results showed that after the largest enlargement of the EU, in the case of plant and livestock production, a simultaneous increase in agricultural production and improvement in efficiency in the individual EU members was achieved, with a gradual reduction of disproportions in the efficiency of agricultural production between regions. The only area where such a relationship could not be observed was related to the production of mixed-type farms. The novelty of the proposed in this article approach is that it allows for simultaneous analysing of changes in EU agriculture while taking into account several perspectives: changes in the assumptions of the common agricultural policy, the consequences of EU enlargement, and results of the implementation of the cohesion policy.

Economic competitiveness vs. green competitiveness of agriculture in the European Union countries

Research background: Many scientists have researched the economic competitiveness of agriculture. At the same time, considerably less attention is paid to the so-called green competitiveness. Considering a global trend searching for solutions to reduce the environmental impact of the agricultural sector, it seems reasonable to explore the overlap between economic competitiveness and green competitiveness. Purpose of the article: This study aims to answer the following questions: What is the level of economic and green competitiveness of agriculture in respective countries? What is the level of the comprehensive competitiveness of agriculture in EU member states? Do the economic competitiveness outcomes of respective countries coincide with their green competitiveness rankings? Methods: Taxonomic methods were applied to design synthetic indices of economic, green and comprehensive competitiveness of 27 member states of the European Union, based on multi-criteria sets of specific indicators from 2018. Findings & value added: The results of analyses imply that, in general, the level of green competitiveness of agriculture is higher than the level of its economic competitiveness in EU member states. Simultaneously, the developed rankings show that respective countries' economic and green competitiveness are not linked. In other words, economic competitiveness outcomes do not match green competitiveness outcomes for EU agriculture. This work is a genuine contribution to studies on the methods for measuring and evaluating the competitiveness of agriculture as it designs separate synthetic measures for economic and green competitiveness and confronts both types of competitiveness in EU member states. The research findings for the first time provide clear answers to questions about the mutual relationship between economic and green competitiveness in agriculture. Furthermore, an added value of this study is that it introduces and attempts to define the notion of green competitiveness.

National and European Actions for the Development of Rural Areas - Stimulus for Ensuring the Sustainability of Economic Development

The policies of the European Union pursue a sustainable and balanced development of the territory of the Community, these aspects being found in the objectives of the UN Agenda for Sustainable Development 2030. Among these objectives are some in the field of agriculture and rural development such as: SDG 2: eradicating world hunger, EU agriculture ensures that food is produced sustainably for all EU citizens, and that EU food exports contribute to food security in third countries. EU rural development and agriculture policies also support other SDGs: SGD 1 (without poverty), DGS 8 (decent work and growth), SGD12 (responsible consumption and production) and SGD 15 (terrestrial life). The article analyses the National Rural Development Program that was created to support through non-reimbursable funds from the European Union and the Romanian Government the economic and social growth of rural areas in Romania, starting from the 6 priorities defined at the European Union level. Thus, we will study the rural development measures financed through the NRDP, in the period 2014-2020, with a total financial allocation of 9.333 billion euros, of which 8.015 billion euros from the EAFRD and 1.347 billion euros representing the national contribution. We will present these measures in detail, based on public data available in August 2021.

How much is policy driving the adoption of cover crops? Evidence from four EU regions

EU agriculture is facing increasing expectations and pressure from society and policymakers to support environmental protection and climate change mitigation. Catch and cover crops (CCC) are an underused farming practice that can potentially contribute towards these goals. Previous research is sparse and has yielded few relevant insights into CCC adoption behaviour by farmers. In this study we analyse a dataset from farm surveys in four EU regions to better understand the role of policy and non-policy factors in CCC adoption. Our data suggests that adoption rates vary widely between regions, while farm adoption intensities are low. We find that policy is by far the strongest determinant of adoption rates and adoption intensities. CCC adoption patterns have been shaped mainly by the Nitrates Directive and the Common Agricultural Policy's greening requirements. Agronomic motives are a third but much weaker impetus for adoption. Environmental and climate change considerations do not play a significant role in farmers' adoption decisions. Most non-adopters would likely become adopters if stronger policy obligations or additional subsidies were implemented. Non-adopters‘ responsiveness to subsidies and willingness to accept is highly varied but only weakly predictable from easily observed farm characteristics.

Are Geographical Indications sustainable in the face of climate change?

The EU is fostering sustainable agriculture. Geographical Indications (GIs) are important in EU agriculture. One justification for GIs is the unique relationship between climate and quality – terroir – in a geographic area. Terroir-based GIs are implicitly sustainable. Relationships in terroir, however, assume constant climate. Climate change can alter these relationships, including sustainability. Economic viability may require new terroir-based production practices. GIs are, however, legal constructs whereby terroir is codified. Thus, altering agronomic practices requires amending legal definitions. This paper explores the legal, agronomic and economic facets of climate change for GIs. It finds that policymakers and GI rights holders may find climate change challenging.

Развитие сельского хозяйства Румынии на современном этапе

Romania’s accession to the European Union in 2007, from the point of view of the subsectors of agriculture, as well as the integration of any of the Eastern European countries, became a challenge for the EU and especially for the Common Agricultural Policy (hereinafter CAP). Romania and Bulgaria, with the countries that joined in 2004 (Czech Republic, Estonia, Hungary, Lithuania, Latvia, Poland, Slovakia and Slovenia), added more than 100 million new consumers to the EU, while doubling the number of farmers and increasing the number of farms by 74%. As a result, a new EU agricultural strategy was developed. The article shows what path Romania has taken in the development, consolidation and “European integration” of its agricultural subsectors of the economy and what successes its agriculture has achieved in the 15 years since the country’s accession to the EU (2007-2022).

АНТИМОНОПОЛЬНОЕ ПРАВОВОЕ РЕГУЛИРОВАНИЕ СЕЛЬСКОХОЗЯЙСТВЕННОЙ ПОЛИТИКИ В ЕВРОСОЮЗЕ

The article is devoted to the legal basis of the general agricultural policy of the European Union as a whole, and the basics of antimonopoly regulation of agricultural trade and market. The work focuses on the issues of monopoly and competition. The relevance of the article stems from the fact that the protection of agriculture and the difficulties in supporting farming is a constant problem of the European Union and at the same time agriculture is one of the fundamental areas for it. Currently, EU agricultural law is aimed at assessing the relationship between world prices and products, and at helping the internal market. The regulations themselves are becoming increasingly precise to identify violations of EU antimonopoly law in a timely manner. However, there are often contradictions between the norms of these acts and the provisions of the antitrust regulations. The food crises faced by the European Union in 2007 and 2010 triggered the need to transform the above-mentioned regulation. For example, there is a certain contradiction between the aspects of Article 39 of the Treaty on European Union defining the main spheres of regulation of the agricultural policy in the European Union, and the provisions of Articles 101 and 102 describing the forms of prohibited market behavior of goods and services producers, which should be examined. It is necessary to identify cases where anticompetitive behavior of agricultural market participants may be acceptable to minimize the possibility of such controversies.

EU microbial pest control: A revolution in waiting

Recent evaluations of the microbial biological control sector indicate that implementing microbial control of pests is still slow in the EU. The top causal factors are the lengthy, expensive, and cumbersome two-stage procedure for approval of biological agents as active substances at the EU level and authorization of formulated products at the national level, limited funding, lack of EU level integrated approaches, and slow implementation of integrated pest management. This article contributes to a better understanding of the factors that limit microbial control of pests in EU agriculture by providing the first evaluation of the evolution of microbial biological control agent (MBCA) EU-level approval combined with that of microbial biological control product (MBCP) national-level authorization, discusses recent trends in research and offers some policy recommendations. By 2020, the EU had caught up with the USA regarding research output, approved MBCAs, and MBCA approval procedures (first stage). Despite improvements from 2014 to 2019, the number of authorized MBCPs (second stage) has progressed slowly and unevenly across the EU. Significant progress is concentrated in countries with more extensive agricultural land and higher research intensity. The EU's focus on promoting more sustainable agriculture by increasing the availability of low-risk pesticides of biological origin as alternatives to conventional chemical pesticides has gained traction in recent years. Nevertheless, more efforts to improve the capacity and expertise of laggard EU Member States to contribute to the approval of MBCA, authorization of MBCP, and stimulating market availability are needed. Furthermore, we recommend introducing more concrete measures to promote the adoption of the microbial control of pests in the National Action Plans for the sustainable use of pesticides. © 2021 Society of Chemical Industry.

Pest categorisation of Xanthomonas citri pv. viticola.

The EFSA Plant Health Panel performed a pest categorisation of Xanthomonas citri pv. viticola (Nayudu) Dye, a Gram‐negative bacterium belonging to the Xanthomonadaceae family. The pathogen is a well‐defined taxonomic unit and is the causal agent of the leaf spot and bacterial canker of Vitis vinifera. This bacterium is present in India and Brazil, where it affects table grape cultivation; the same pathogen is able to cause a disease on Azadirachta indica and on some weed species. Reports indicate that the bacterium is present in Thailand as well. The pathogen has never been reported from the EU territory and it is not included in EU Commission Implementing Regulation 2019/2072. The pathogen can be detected on its host plants using direct isolation, serological or PCR‐based methods. Its identification is achieved using biochemical and nutritional assays, together with a multilocus sequence analysis based on seven housekeeping genes. The main pathway for the entry of the pathogen into the EU territory is plant propagation material. In the EU, there is large availability of host plants, with grapevine being one of the most important crops in Europe and more specifically in its Mediterranean areas. Since X. citri pv. viticola is only reported in tropical and subtropical areas (BSh and Aw climatic zones according to the Köppen–Geiger classification), there is uncertainty whether the climatic conditions in the EU territory are suitable for its establishment. Nevertheless, due to the great importance of grapevine for the EU agriculture, any disease outbreak may have a high‐economic impact. Phytosanitary measures are available to prevent the introduction of the pathogen into the EU. X. citri pv. viticola satisfies the criteria that are within the remit of EFSA to assess for this species to be regarded as a potential Union quarantine pest.

Variability of hired labour wages and farmers’ own labour remuneration across EU countries

The consistent downward trend in the number of farmers and their family members working on farms, observed for many years, forces farmers to use hired labour, which significantly affects issues related to the payment for labour in EU agriculture. The aim of the study discussed in the article is to assess the differences in the level of hired labour on farms in EU countries and the remuneration of farmers and their family members, which is provided for by the income of the farm. In order to achieve this goal, it was necessary to determine the amount of time of hired work on farms and the remuneration per hour of hired work. The article also examines the effect the Common Agricultural Policy subsidies supporting the farms’ operating activity have on farmers’ remuneration. The subject of the study focused on commercial farms keeping FADN agricultural accounting in 28 EU countries. Standard results of the FADN EU were used in the analysis. The average results of two periods which included the years 2015– 2017 and 2018–2019 were assessed. Horizontal and vertical analyses were used to compare the parameters characterising farms in individual countries in both periods of the study. The conducted research indicates a growing demand for hired labour on farms in the EU, which increases the share of the cost of hired workers in the total costs of a farm. Therefore, it is advisable to continue public support in the framework of the agricultural policy, which contributes to the generation of farm income at an acceptable level. As the study shows, the hourly wages of hired workers in most EU countries exceeded the per hour, unsubsidised income resulting from a farmer’s own labour, and such a situation – from the farmers’ point of view – undermines the economic viability of continuing agricultural production.

Modelling the Common Agricultural Policy Impact over the EU Agricultural and Rural Environment through a Machine Learning Predictive Framework

This research provides an analytical and predictive framework, based on state-of-the-art machine-learning (ML) algorithms (random forest (RF) and generalized additive models (GAM)), that can be used to assess and improve the Common Agricultural Policy (CAP) impact/performance over the agricultural and rural environments, easing the identification of proper instruments that can be used by EU policy makers in CAP’s financial management. The applied methodology consists of elaborating a custom-developed analytical framework based on a dataset containing 22 relevant indicators, considering four main dimensions that describe the intricacies of the EU agricultural and rural environment, in the CAP context: rural, emissions, macroeconomic, and financial. The results highlight that an increase of the agricultural research and development funding, as well as the agriculture employment rate, negatively influence the degree of rural poverty. The rural GDP per capita is influenced by the size of the employment rate in agriculture. It seems that environmental sustainability, identified by both fertilizers used and emissions from agriculture parameters, significantly influences the GDP per capita. In predicting emissions in agriculture, the direct payment, degree of rural poverty, fertilizer use, employment in agriculture, and agriculture labor productivity are the main independent parameters with the highest future importance. It was found that when predicting direct payments, the rural employment rate, employment in agriculture, and gross value added must be considered the most. The agricultural, entrepreneurial income prediction is mainly influenced by the total factor productivity, while agricultural research and development investments depend on gross value added, direct payments, and gross value added in the agricultural sector. Future research, related to prediction models based on CAP indicators, should also consider the marketing dimension. It is recommended for direct payments to be used to invest in upgrading the fertilizers technologies, since environmental sustainability will influence economic growth.

Strategic Actions for a Sustainable Internationalization of Agri-Food Supply Chains: The Case of the Dairy Industries from Brazil and Germany

While facing a growing domestic demand of milk and milk products, the Brazilian dairy industry is far behind in terms of competitiveness and sustainability when compared to other national agricultural sectors. Nonetheless, in Germany the leading dairy companies mainly pushed by a saturated domestic market, EU agriculture policy oriented to liberalization of markets, and increasing political and social demands are looking at markets beyond EU. In the context of the increasing globalization of agricultural supply chains, the issue of sustainability gains particular importance in companies’ internationalization strategies. By using expert interviews, this paper investigates strategies for integrating Brazilian and German dairy supply chains and how both sides can benefit from this situation also in terms of sustainability. The analyses show that problems of the industries in both countries basically complement each other at different levels and positive synergies for both sides exist when it comes to sustainable issues, positioning themselves competitively for the future and creating a good position for conquering market shares in a globally growing milk market. This paper proposes an approach for the challenges of such integration, as well as viable solutions to sustainability issues.

Greenhouse gas mitigation technologies in agriculture: Regional circumstances and interactions determine cost-effectiveness

Agriculture, forestry and other land use are important components of a global strategy to limit climate change. Using the example of EU agriculture, this paper examines the potential contribution of technological (i.e. technical and management-based) greenhouse gas mitigation options to climate targets. The quantitative framework presented allows to analyze disparities between marginal abatement cost curves (MACCs) derived from two different commonly used approaches, and between aggregated and regional MACCs. Results highlight the importance of assessing mitigation of agricultural emissions from a multi-dimensional perspective, considering regional heterogeneity of biophysical and economic circumstances and comprising both carbon-dioxide (CO2) and non-CO2 emissions. Regarding the ranking of technologies in terms of mitigation potential and costs, the results underline the need to consider technologies in a combined manner, avoiding the simple aggregation of mitigation potentials by individual measures without taking their interactions into account. Focusing only on standalone MACCs can lead to an overestimation of the mitigation potential. Conversely, measures classified as relatively high cost in standalone and aggregated MACCs should not be discarded, as they can still be cost-effective in some regions. The analysis shows that there is no ‘one size fits all’ rule that could be followed for identifying technologies that should be implemented in all regions. From a policy perspective the results imply that farmers should be granted some flexibility to adopt a set of cost-effective mitigation options that best fits their circumstances.

Does a Demographic Crisis Threaten European and Polish Agriculture?

In recent decades, problems in family farming have been coupled with a demographic crisis. In the face of unfavourable demographic forecasts and processes, the EU’s agricultural policy has consistently underlined the strategic importance of family farming and the need for its development as a vital segment of the economy and the core of rural communities. The paper aims to assess the grounds for policies focusing on alleviation of the demographic crisis in EU agriculture as well as giving a preliminary presentation of the effects of implementing the instrument involving subsidies for young farmers’ farms, on the example of Poland. The analyses suggest that the mechanisms for accelerating generational changes in EU agriculture have been based on questionable premises and have been not adjusted to the needs at national and regional level. In the EU policy documents and public debate, the support for generational turnover is based on arguments diagnosing a particularly adverse demographic situation in the agricultural sector. The article shows that this position is too general and unnuanced, because it does not include the general long-term population changes, other economic sectors and the different socio-economic and institutional contexts in member states, as well as being limited to a narrow range and often non-comparable public statistics. At present it is also hard to find justification for claims that instruments like subsidies for young farmers have resolved the problem of farms without successors and contributed to generational renewal in agriculture. Varied sources of data and information have been used, including EU and Polish legislation, thematic and expert studies related to demographic issues in agriculture, and empirical material gathered by public institutions.

Economic and Environmental Consequences of the ECJ Genome Editing Judgment in Agriculture

Genome-edited crops are on the verge of being placed on the market and their agricultural and food products will thus be internationally traded soon. National regulations, however, diverge regarding the classification of genome-edited crops. Major countries such as the US and Brazil do not specifically regulate genome-edited crops, while in the European Union, they fall under GMO legislation, according to the European Court of Justice (ECJ). As it is in some cases impossible to analytically distinguish between products from genome-edited plants and those from non-genome-edited plants, EU importers may fear the risk of violating EU legislation. They may choose not to import any agricultural and food products based on crops for which genome-edited varieties are available. Therefore, crop products of which the EU is currently a net importer would become more expensive in the EU, and production would intensify. Furthermore, an intense substitution of products covered and not covered by genome editing would occur in consumption, production, and trade. We analyzed the effects of such a cease of EU imports for cereals and soy in the EU agricultural sector with the comparative static agricultural sector equilibrium model CAPRI. Our results indicate dramatic effects on agricultural and food prices as well as on farm income. The intensification of EU agriculture may result in negative net environmental effects in the EU as well as in an increase in global greenhouse gas (GHG) emissions. This suggests that trade effects should be considered when developing domestic regulation for genome-edited crops.

The impact of EU’s financial support on the agriculture’s development: a panel data analysis

Abstract The Common Policies represent one of the fundamental values of European Integration process. Started from coal, steel and energy, the EU common policies were significantly extended overtime. The aim of this study is to analyze the Common Agriculture Policy (CAP) from the perspective of the financing instruments for the members. The paper studies the evolution of these funds overtime, highlighting the major changes and shifts in the priorities and goals of them, their direct impact on the main sectors (including rural area) and the implication of EU enlargement on this important policy. The paper includes a cross-sector panel analysis at the level of European Union and Euro Area on the impact of the net subsidies granted to agriculture and the production volume of this sector overtime. The empirical findings confirmed a positive impact of these net subsidies on the production volume of agro-sectors and the long-run relationship between the tested variables. However, the use of 3 years lags revealed a negative and statistically significant relationship between the dynamic of net subsidies and the production volume for EU and Euro area aggregated production volume dynamic. The analysis gives us the possibility to capture the main tendencies and trends and to draw important conclusions for the further developments of the EU agriculture as the subject of this common policy.