| Abstract: | In the years prior to Denmark's entry into the European Common Market (EEC) in 1973, Danish agricultural exports began to encounter difficulties. As exports account for about two thirds of production in the sector, total agricultural production also stagnated in the 1960s and early 1970s. Entry into the EEC was expected to result in an increase in agricultural production; the increase has, however, failed to materialize.The fact that agricultural production has not increased in the years following entry into the EEC is due to a complex interaction of factors. One explanation is a fall in the number of agricultural holdings which has led to a considerable reduction in the productive capacity of the sector. The relatively high level of interest and costs has also had a dampening impact on the investment propensity. However, in 1977 and 1978 there has been a trend towards an increase in investment in livestock production which indicates an increase in total agricultural production for the years to come.An important part of the Danish economy is the integration of the agricultural sector with the large food processing industry.1 The links between agriculture and other sectors are rising. The purchase of raw materials and means of production, plus the depreciation of machinery and building requirements, now account for up to 60% of the total agricultural production in terms of value. There is consequently a strong general interest in the future development of Danish agriculture. The recent international recession has also furthered an increased political interest in the exploitation of agriculture. Agricultural policy is thus tending towards a more central importance in the general and the specific economic policies.The central elements of the current discussion have been the volume of the production potential of Danish agriculture, and the market potential existing in the years to come. These considerations are discussed below, on the basis of both historical trends and of a study recently published on alternative development possibilities for Danish agriculture.2 |
