The past few months have been extremely challenging for Hungarian farmers and the entire Hungarian society. In addition to the crisis caused by the war in our neighborhood, Hungary and Europe are facing a historic drought. The government and the Ministry of Agriculture are doing everything possible to support farmers in this exceptional situation, as it is in our strategic interest to ensure a secure food supply.
The government has set up a Drought Emergency Operational Task Force in order to take measures that deal with the exceptional drought situation and the consequences of increasing energy prices in agriculture. The body has proposed a five-point action plan to provide quick assistance.
As part of the scheme, the government is imposing an optional credit moratorium on investment and working capital loans for agricultural businesses from September 2022 onwards until the end of 2023. Furthermore, HUF 3 billion in aid will be earmarked for the transport of fodder for livestock farmers facing supply problems. An additional HUF 1.4 billion will also be granted to support the increased energy costs of public irrigation plants serving the irrigation of agricultural land. Further assistance will be provided in that farmers will be able to resubmit their applications for exceptional water use and will be automatically granted authorization. Finally, the procedure for insurance companies to assess and pay for drought damage suffered by farmers will be sped up to 14 days.
Let us emphasize that at a time when we are on the verge of a food crisis due to the war situation and when famine is threatening many regions of the world, our domestic food supply is secure even despite the changed climate conditions and the factors that have made production significantly more expensive. In a good year, Hungarian agriculture can provide food for 22-23 million people, and although the drought has caused great damage, it has not put food security at risk.
Since Hungary is an important wine producer, let us also say a few words about the fact that the drought has also affected the wine regions and vine-growing farmers, thus a well-thought-out strategy and cooperation between areas are of paramount importance. In order to improve the competitiveness of the Hungarian wine sector, some HUF 75 billion in support has been provided for the modernization of Hungarian vineyards and some HUF 30 billion in technological investments by wineries in recent years. Also, the new wine market regulation helps to reduce administrative burdens through simplified procedures and electronic management.
The government aims to increase the resilience of agriculture to drought, including by preparing a longer-term comprehensive action plan for irrigation in the country. In recent years, significant efforts have been made in this regard: Irrigation communities have been established, tens of billions of forints have been invested in the field, farmers have already received HUF 45 billion in support for the development of irrigation farming, and a further HUF 70 billion is earmarked for this purpose.
In today’s world, which is experiencing many crises, a competitive agriculture sector that guarantees the country’s food security and a farming community that supports the sector are of enormous value. Since 2010, agricultural output has increased by 25.5 percent, while the food industry has grown by 42 percent. The profitability and efficiency of the sector — which stood at 50 percent of the EU average in 2010 — has also improved significantly. Agriculture additionally plays a key role in Hungary's foreign trade, with agricultural exports having grown by 82.2 percent since 2010.
The Hungarian government acknowledges that farmers work hard to ensure continuous production despite all the current difficulties and therefore regards it as a priority to help them overcome the historic drought situation and maintain a secure food supply.