New risk factors have emerged in the agricultural sector
New, hard-to-model risk factors have emerged in the global agricultural sector, such as the intensification of climate awareness, rapid changes in consumer habits, or the US-China trade war.
In Hungary, where agriculture accounts for 3.4 percent of GDP, in addition to the spillover effects from Europe and China, labor shortages, mounting inflationary pressures and exchange rate effects, the problem of generational shifts, the increasing number of animal diseases and the support cycle is the most serious issues. As a result, actors in the agricultural sector should focus on improving profitability and efficiency rather than growth alone. Globally, Euler Hermes expects profitability to decline, but in Hungary – after rising in recent years – to remain below the global average.
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