RIGA - Latvia has a rich history in agriculture and farming. Before the beginning of World War II, its farmers had successfully competed with European agro-producers. Karlis Ulmanis, the first Prime Minister of Latvia, studied agriculture in Switzerland, Germany and the U.S. and taught agriculture briefly upon his return to the country. Ulmanis can be credited with increased efficiency of the Latvian farms in those days. In the late 1930s there were 16 regular steam-ship routes from the Riga, Ventspils and Liepaja ports to major European destinations, such as London, Bremen, Hamburg and Stockholm. Latvian butter and bacon were the main exports to the West, as well as to the Russian market.
During Soviet times the small individual farms were replaced by the much larger state, or collective farms. By the end of the 1950s the consolidation of independent homesteads was almost complete, with over 90 percent of the farms turned into the kolhozs.
Currently, the Latvian agricultural sector is fully private. Farming is one of the main economic activities in the rural areas. Many farms are owned and operated by a single family that relies on agricultural output for all of its income. Raivis Magonis, a small farmer in the Cesis district of Vidzeme, explains his choice to stay on the land he inherited from his grandfather: "I truly enjoy this lifestyle; I think that I was born to take care of the land. Farming involves really hard work - I have to get up before the sun rises and there are no days off. However, I can see the tangible results of my work every day, and it feels really good to see that the local people like the goods that I bring to the market. I know that I will never move and I hope to live long enough to see my son's children take over."
Janis Cimbulis, just graduated from high school, has a different opinion. "Maybe I would like to settle down in the country, but I would definitely like to see the world first. Besides, being a farmer is not enough anymore - I want to be an entrepreneur. I want to be able to make an educated decision about the type of goods that I am producing, I have to have access to the best technologies available on the market and finally I have to know how to advertise and sell my produce at a maximum profit."
The availability of quality education is crucially important for maintaining the country's competitive advantage in the modern marketplace. Latvia was successful in preserving its considerable academic legacy in the field of agriculture. Cimbulis is thinking about attending the University of Agriculture of Latvia (LLU), the third largest higher educational establishment in the country. The university offers over 70 programs on different subjects, such as agriculture, veterinary medicine, food technology, field management, forestry, and environment management. LLU was founded in Jelgava in 1939 while its oldest faculty, the Faculty of Agriculture, dates as far back as 1863. However, for the students nowadays the modern opportunities are just as important as the historic legacy. "I have chosen this university because I feel that it is very well integrated into the international system of education," says Cimbulis. "I want to receive an education that is competitive not only on the European, but also on the global level."
Spurred by the accelerated economic growth of the Baltic region, the agriculture industry in Latvia has developed considerably in the past decade. Even though the share of agriculture in Latvia's GDP composition has shrunk over the years (according to International Monetary Fund statistics, at the end of the 1980s the sector employed 16 percent of the work force and amounted to 21.1 percent of GDP, whereas in 2006, the share of agriculture, hunting and forestry in the gross national product accounted to 3.2 percent; it remains one of the essential composites of the Latvian economy.
Organic farming, one of the most promising export-oriented industries in Latvia going forward, has experienced the modernization of agricultural equipment that resulted in the steady increase of farming productivity. The implementation of EU-regulated quality inspection systems, as well as European Union and Latvian government investments, have stimulated the development of all agricultural sub-sectors including crop and livestock production.
The additional funding which became available since Latvia's accession to the EU in 2004 resulted in diversification and modernization of farming methods and practices as well as in the growth of Latvian agricultural exports. Main export destinations, according to the Central Statistical Bureau of Latvia, are Lithuania, Estonia, Russia and France for cheese and curd, Estonia, Italy and Germany for butter. Since fostering international contacts is the foundation of the modern business development model, network-building activities cannot be suspended, even in today's challenging economic conditions. Though the impact of the global economic crisis has been felt across every industry in the Baltic region, Latvian farmers are focusing on maintaining their presence in the traditional markets, as well as exploring new export destinations, such as the U.S. This September, Latvian Agriculture Minister Janis Duklavs met with the newly-appointed U.S. Ambassador to Latvia Judith Garber to discuss the opportunities of increasing cooperation in the sector of agriculture.
Currently, the farming sector is fully in private hands, and is largely composed of the small farms cultivating grain, potatoes, rapeseed, fruits and berries as well as producing milk, pork, poultry, veal and beef. The demand for the domestically produced agricultural goods is constantly growing. Many Latvians have fully embraced the global trend of living healthier and greener, based on supporting natural farming methods.
As a consequence, there has been an increase in the number of farm markets and organic produce stores offering a variety of quality products from the local farms and fields. There typically is a higher cost associated with bio-farming: organic feed for cattle and other livestock can cost twice as much as the conventional feed, while limiting the use of agrochemicals and relying on natural farming methods translates into lower production outputs. According to Selegovska's and Spruza's research, published in the Latvian Journal of Agronomy (No.10, LLU, 2008), the milk yield obtained from organic farms is 17 percent lower compared to conventional farms, yet milk fats, lactoses and the protein content of organic milk is substantially higher. Last year, the share of organically cultivated land in Latvia was still less than 10 percent of the total farming area, but the sector analysts forecast sustainable development of this sector going forward. Over 4,000 organic farms in the country have different levels of certification and a large number of the Vides Veselibas Saimes (Nature Friendly Households) are participating in the programs organized by the Association of Latvian Organic Agriculture that was founded in 1995.
Even though the benefits of consuming organic versus conventional is subject to debate, generally, many Latvians are willing to pay premiums for the quality associated with the natural-grown products. Magonis says "I have my loyal customers who come to me time and time again. My potatoes cost 5 santimes (0.07 euros) more than those you can buy in the store, but I can personally guarantee you the quality of every piece." According to Magonis, smaller local markets have effective quality control mechanisms that are benefiting the customers in the long run, "There is a really small community of farmers here, and the customers know each and every one of them personally. As soon as the quality goes down, people vote with their feet, and since the news spreads really fast around here, I have to make sure that my produce is top-notch every time."
