Anticipated Calm in Agriculture and Food Industry for the Year Ahead
MBH Bank Predicts Positive Shift in Hungarian Agriculture
Dávid Hollósi, the managing director of MBH Bank’s agro-food business, has made some bold predictions about the future of Hungarian agriculture. He foresees a positive shift and anticipates a sustained upturn starting in 2024, with equilibrium likely by 2025.
Several factors contribute to this optimistic outlook, including a more predictable economic environment, declining input costs, and forthcoming rural development tenders. These developments enable increased lending for agricultural investment, breaking the stagnation in agricultural lending.
Mr. Hollósi also foresees a shift in arable crop production away from dependency on grain yields for exports. He urges Hungarian grain producers to enhance efficiency and reduce reliance on subsidies for long-term viability.
Dávid Mezei, MBH Bank’s head of agri-food business, emphasized the importance of strengthening food companies for overall sector competitiveness. He highlights the pivotal role of food companies as primary buyers of agricultural products and the availability of substantial rural development funds for investments, complemented by an interest subsidy to support applicants.
Mr. Mezei also anticipates new development tenders in 2025 amid potential changes in the EU’s agricultural funding system, urging farmers to capitalize on current support before potential post-2027 alterations.
According to strategic analyst Csaba Héjja, there have been improved conditions across various agricultural sectors by the end of 2023, particularly in pork and cattle farming, with stable prices and incomes. However, challenges persist in vegetable and field crop production, such as high labor costs and profitability concerns. Fruit growers also face uncertainty attributed to market unpredictability and aging plantations, necessitating specific structural changes. Mr. Héjja advises producers to focus on cost reduction, as they lack influence over price developments.
Despite the positive trends, challenges remain in 2024, alleviated by anticipated improvements in economic sentiment driven by rural development tenders. This forecast provides a promising outlook for Hungarian agriculture, with potential opportunities for growth and development in the coming years.
