COUNTRY REPORT ON THE PRESENT ENVIRONMENTAL SITUATION IN AGRICULTURE
- ESTONIA -

Ülle Roosmaa
Estonian Agricultural University, Tartu

INTRODUCTION

Estonia has an area of 45 230 km² and a population of 1.5 million inhabitants. Administratively, Estonia is divided into 15 counties, with 254 municipalities. The largest city is the capital, Tallinn, with a population of 435 000. Estonian independence was declared in August 1991. Up to 1990 the Estonian economy grew slowly, but from 1991 onwards the transition from a centrally planned economy to a market economy led at first to a significant decrease in GDP. In 1992, the real change in GDP was -22 percent. Since then, significant progress has been made in terms of macro-economic development. In 1993, the economic decline slowed down to -8.5 percent and in 1994 to -1.8 percent. The year 1995 was the first year of resuming growth with a rate of 4.3 percent, in real terms. In 1996, economic growth continued at 4.0 percent.

The stabilization and recovery of Estonian agriculture is dependent on the country's general economic growth. In the first half of 1997, Estonia was one of the world's fastest-growing economies, reaching a real growth rate of 11.7 percent. For 1998 and 1999, a growth rate of 4.7 percent is expected; a growth rate of 4.5 percent is forecasted for 2000-2003. Domestic demand is expected to increase, a trend which will also hold for the demand for food products. Agriculture has traditionally been one of the most important sectors in the Estonian economy. In 1996, agriculture accounted for 5.5 percent of GDP and employed 8.1 percent of the labour force. When forestry and fishery are included, the share of GDP is 7.3 percent. The drop in agricultural employment from 18 percent in 1989 to 8 percent in 1996 illustrates not only dramatic developments, but is also attributable to several statistical changes. In 1997 the gross agricultural output was 5.51 thousand million EEK at 1995 prices, i.e. 1.5 percent smaller than in 1996. Fisheries play an important role in the Estonian economy. In 1996, fishing provided 0.5 percent of GDP, excluding the fish processing industry, which is the fourth biggest subsector of the food industry. Fisheries employ approximately 20 000 workers. Forestry is an important part of Estonian economy and natural resource base as forests cover 45 percent of the total land area with 1.9 million hectares in January 1997. In 1996, forestry accounted for 1.3 percent of GDP, and the manufacture of wood and paper products 1.1 percent of GDP.

THE IMPACT OF TRANSITION AND STRUCTURE OF PROPERTY RIGHTS

The effect of privatization and the redefinition of property rights on natural resources

The development of agriculture in Estonia has been the subject of several agricultural reforms. There have been three agricultural reforms in Estonia in the 20th century:

• Land reform and the establishment of new family farms on a wide scale in 1919;
• The Collectivization of family farms in 1947-1950; and
• Land and agricultural reforms started in 1991 with the aim of spliting up large-scale collective and state farms and re-establishing family farms.

Regarding the last stage, the very first structural changes in agriculture were launched before independence was regained in 1989 when The Farm Law was adopted. This law was the first step which departed from the central planning of agriculture. The Farm Law permitted the creation of private farms with an arable area of up to 50 hectares. Approximately 8 600 private farms were established according to this law.

Bigger and basic structural changes in the Estonian economy, including agriculture, started after independence in 1991. From 1991 to 1992 some laws that were to have a far-reaching influence upon developments in agriculture were passed: Basic Proprietary Reform Law (1991), Land Reform Act (1991), Agricultural Reform Act (1992). The above mentioned laws formulated and specified the objectives, the principles, and the routine of privatization.

The objective of privatization was the creation of structures oriented towards the competitive market. Privatization was carried out based on two main principles: the restitution of, and compensation for, illegally alienated 1940 property, and the distribution of property acquired after 1940 in accordance with labour input (Laansalu, A.). The land reform process started in 1992 on the basis of The Land Reform Act, which was passed on 17 October 1991. This act has been modified and amended several times, and it regulates the re-arrangement of relations of land ownership within the framework of land reform. The land reform procedures are complicated because restitution was assigned first priority. This means that the land can not be privatized before the applications for restitution are discussed in the local municipalities and the respective decisions are made. The property will not be restituted if this is not possible or if the former owner opposes it. Most of the entanglements and complications of land reform are connected with privatization (Järv, A.).

The whole privatization process proved to be time consuming in Estonia. After more than five years of land privatization policy, preliminary results indicate that only one fourth of the land will finally be restituted. Originally, there were claims covering only 50 percent of the arable land; during the process, half of the claims were withdrawn. Many people who had the right to claim land had other professions; in many cases they were city dwellers, so that to start farming would require moving to the countryside. Also the attitude of the general public towards agriculture was not encouraging. Some people even questioned whether Estonia needs agricultural production at all. Combined with the poor profitability of farming in general, as well as lack of actively functioning land markets, these reasons resulted in a low rate of claims.

The privatization process involved new obligations for agricultural enterprises. Firstly, they must pay compensation totalling 377 million EEK to 100 000 qualified claimants. Secondly, they must recognize labour shares of 987 million EEK for 185 000 former workers. In January 1997, agricultural reform was completed in 178 state farms, and 85 percent of the compensation and 94 percent of the labour shares were paid. Reform was well advanced in most of the remaining farms. The privatization of the agricultural enterprises' land would be possible either by selling it to the current members of agricultural enterprises or by opening competition to buyers on the basis of auctioning. There are also proposals for creating the legal framework for leasing. If farmland can not be privatized by selling it, a long-term lease would solve the problem for some time. At the expiration of the lease period, the parcel would be auctioned for sale again. Leased land could be used as a guarantee for loans and selling part or all of the lease would be possible.

Only 10 percent of the forests are managed by private owners. In August 1996, 57 percent of the forests were managed by state forest districts. The privatization of forests encountered the same problems as the restitution of arable land. The 22 000 private family farms each have at present approximately 8 hectares of forest on average. As for fisheries, the whole sector is privatized. The privatization process of up- and downstream facilities advanced faster than the privatization of land. Privatization took place by tender, public or restricted auction, or public offers for the sale of shares through the stock exchange. Shares in the agroprocessing enterprises are held either by producers, private shareholders or by foreign investors. Shares of these farm enterprises are quoted on the Tallinn stock market quite succesfully. Since 1996, the whole downstream industry has been privatized.

Restructurization in rural areas

In 1990, there were 117 state farms and 212 collectives in Estonia. The average size was 3 700 hectares. After independence, these farms were to be privatized, and land and other assets returned to previous owners or to their heirs.

Table 1: Number and average size of private farms and agricultural enterprises, 1 January 1994-1998

Source: Agriculture 1997

A key issue in the structural development of the farm sector has been the privatization of land. New agricultural enterprises are organized mostly as joint stock companies, but also as cooperatives and partnerships.

Agricultural enterprises are referred to as former state farms and collectives, of which most are now privatized, although the state still owns the land on which they operate. Family farms are defined as private farms, which operate on restituted land and which is owned by the farmer. In 1997, their average size was 22 hectares of which approximately 14 hectares was arable land and the rest forest or other land. About 29 percent of the farms have less than 10 hectares, while 24 percent have more than 30 hectares. In the period 1992-1997, the number of smaller farms increased more than the number of bigger farms. About 45 000 household plots exist with an average size of approximately four hectares. Household plots which form 21 percent of the cultivated arable land are cultivated by workers of former state and collective farms. The difference between a private family farm and a household plot is not always clear. Some of the farms, privately owned by a family, are counted as household plots because they are not enrolled in the farm register.

Liberalization

After regaining its independence, Estonia has pursued the principles of a liberal trading policy and has not applied any means to protect its domestic market. The liberal strategy is oriented towards promoting a specialized, intensive, "capitalist type" of farm. Liberal agricultural policy causes a complete restructuring of the agricultural production, labour, and marketing systems, even though the competitiveness of Baltic agricultural products on both local and international markets is by no means guaranteed, and rural livelihood has dramatically changed. Liberal policies in their present shape copy the Western agricultural model of previous decades in underestimating social and environmental concerns (Tisenkopfs, T.). In view of the present situation, normal competition on the domestic market is being distorted by the subsidized import of agricultural products from rich countries, with the export of Estonian agricultural production inhibited by (high) protective tariffs on the domestic market in foreign countries.

Food prices have still been increasing at a slower pace than the general consumer price index: in comparison to 1993; the consumer price index of August 1996 was 236.5 percent, food accounting for 181.3 percent (Maadvere, E.).

The development of the economic framework at farm level

Land market

Farmers have the possibility to expand their crop production without purchasing land as unused arable land is available. Non-privatized land can be used on the basis of a request to the local community, but only on an annual basis, and without having any guarantee of continuance. The charge for using this land corresponds to the land tax. There is a strong need for a functioning land market and land rental market, since land would be needed as a collateral for loans. Efforts toward creating a land registry have been made, but progress is still limited. The price of land fell as a result of poor profitability and inadequate land markets in Estonia. Land tax is approximately one-two percent of the taxation price of land. In 1993, the taxation price of arable land was EEK 6 000, but by 1995 the taxation price decreased to EEK 3 000. The bureaucratic process of buying land costs, in many cases, as much as buying the land.

The development of input and output prices

From 1991 to 1994, the prices of agricultural inputs increased 17 times, the producers' prices 11 times, and the retail prices of food products 29 times, resulting in a decline of the purchasing power of the population and a drop in income of agricultural businesses (Laansalu, A.).

In the second quarter of 1997, compared with 1995 (base year), seeds became more expensive by 87.3 percent, energy, fuels and lubricants by 58.3 percent, and feedingstuffs by 47.9 percent. Pesticides became 1.6 percent cheaper( Statistical Office of Estonia). As for inputs, the Statistical Office of Estonia has calculated a price index since 1995. There is no index available with a base year prior to 1995. Animal feed prices have the biggest influence on the overall index. Together with energy, they account for 72 percent of the whole index. According to the input price index, by the third quarter of 1997, input prices had risen by 51 percent compared to 1995. While the price of pesticides declined, pesticide use has not yet returned to normal.

There is no detailed data available concerning output prices. The calculation of an output price index was scheduled to start in 1998. However, some rough estimates can be made on the basis of national accounts and nominal producer prices. In 1996, the nominal producer price level of all products rose significantly compared to 1995; but in 1997, the nominal cattle and poultry meat prices decreased by 2-3 percent and the price of milk rose by 5 percent compared to 1996. Comparing 1997 to 1995, average producer prices rose by 12 percent for beef and 24 percent for milk. The average cost level rose during the same period by 51 percent, which indicates a reduction in profitability at the farm level.

Changes in international prices have immediate effects on Estonian producer prices because of the lack of border protection. Since the fourth quarter of 1996, pork prices have been at exceptionally high levels, increasing within one quarter from EEK 20 840 to EEK 24 892 per tonne, affected by international markets and the lack of domestic supply. During the fourth quarter of 1997, the pork price level even slightly exceeded the EU-level, being EEK 25 610 or ECU 1 618 per tonne. During the fourth quarter of 1997 pork prices were 44 percent higher than in 1995. Despite the higher prices, costs have risen more than the revenues.

Estonia is a small country, which means that it is destined to be a price-taker on the world market. The difference between Estonian and EU producer prices has decreased remarkably since 1993. However, this is not the case for all products. Domestic markets are only just beginning to stabilize. But imbalances and fluctuations in supply and demand could still have an impact on price relations. Estonia has no quota system for milk production, nor for any other products. And finally, Estonia had practically no support measures for agriculture. The year 1998 was the first year with direct payments. Since Estonia abolished all consumer subsidies and all border protection measures, the markets are strongly affected by changes in international prices. For this reason, the stabilization of production proved to be difficult, and the profitability of farming varies strongly. Price differences vis-à-vis the EU was also caused by a lower quality of products. This is the case, in particular, for beef and milk. In addition, the downstream industry is still relatively inefficient and the collection of raw materials is not effectively organized. Price information is collected by the Statistical Office of Estonia, with the help of different sampling methods, which may, however, to some extent affect the results. The following producer prices are converted into ECU using an annual exchange rate (compared prices are EU-15 average market prices).

Table 2: Estonian producer prices, % of EU prices

Source: Agricultural Situation and Prospects ...

THE IMPACT OF AGRICULTURE ON THE ENVIRONMENT

Environmental degradation caused by agriculture

Agriculture and the environment are not conflict in themselves. The conflict is caused by the behaviour and interests of men (Deverre, C.). The environmental aspect means that we have to take into account changes caused by human beings in nature: fields, roads, irrigation, etc. In Estonia we can observe what happens to the natural balance when great areas are not cultivated for some years. On the other hand, sustainability also means sustainable development in bodies of water: fewer fertilizers and pesticides and new technologies in agriculture. So sustainability does not only mean maintaining the situation. Changes in the environment (landscape, oxygen, etc.) also have to be dealt with as a product of agriculture.

Concern about environmental issues in agricultural production is not a new subject in Estonia. Environmental problems have been discussed and worked on for many years. One of the most urgent problems during the period of Soviet rule in Estonia was the pollution of surface and ground water due to an excessive concentration of animal husbandry and system of liquid manure. The other important problems were linked with bad spreading technology and storage facilities for mineral fertilizers and pesticides. Sustainable agriculture deals with problems in the border areas between economic and technological development, food production, protection of the environment, and the quality of life. A vital task is to maintain the production potential of the soil, farms, and agricultural society, without unacceptable consequences for the environment or the human population (Skutlaberg, A.).

Those rural communities based on agricultural production have reached the limits of their growth and development. There are environmental and technological limitations on the one side, and market, consumer and economic ones on the other. The demands on agriculture by both society and the market have changed more quickly than agricultural production, technology and rural society. People living in rural regions are often no longer able to earn their living in the traditional ways without adapting them. In spite of their different historical backgrounds, this problem is common in both the Nordic and the Baltic Countries (Westerlund, K., Loolaid, Ü.). The negative influence of agriculture on the environment has decreased remarkably in Estonia. Due to the decline in production capacities, the emission of pollutants to the environment has decreased and the general state of the environment has improved. However, despite the sharp decrease in the use of fertilizers, the recovery of the environment will take a long time.

Agriculture and soil protection

According to the data of the Yearly Cadastre on 1 January 1998, the area of Estonia was 4 522 726 hectares. The area of agricultural land was 1 433 100 hectares (32 percent of the total area) and the area of arable land was 1 119 780 hectares (78 percent of the agricultural land). About 45 percent of the total area is forest (Table 2).

Table 3: Land stock, 1 January, 1995-1998 (thousand hectares)

Source: Agriculture 1997, (Data of the Estonian Land Board)

Despite Estonia's small area, the soil-climatic conditions for plant growth are extremely variable. Land structure varies from county to county. The share of arable land is greatest in Tartu County (55 percent of all land) and the share of forest is the greatest in Hiiumaa (42 percent). Arable land covers 1 128 million hectares, representing 78 percent of the agricultural land. About 310 thousand hectares are permanent pastures and the remaining 15 thousand hectares are used for permanent crops i.e. fruit and especially berries. Thus, in 1997 the main part (56 percent) of cultivated arable land was used for fodder crops and 39 percent for cereals. The remaining 5 percent was used to grow industrial crops, potatoes and vegetables.

Currently, the percentage of unused arable land has stabilized at around 220 thousand hectares, which is equivalent to 20 percent of the total arable land. In 1992, only 1 percent of arable land was idle. There are three principal reasons for this situation. Incomplete land registration is one of the key elements, as 75 percent of agricultural land is still in the hands of the state. The land privatization process is proceeding slowly and, so far, idle land also remains in the hands of the state because there are no claims on such land at all. In addition, farmers find it unprofitable to produce. And thirdly, the quality of soils on the remaining state owned land is lower than the national average.

One possible outcome may be that most of the idle arable land will not return to agricultural use and the land will gradually start to become woodland. This phenomenon has also a regional dimension; most of the idle land is situated in the south-eastern part of the country. The share of idle land is even much higher when the idle natural grassland area (approximately 175 thousand hectares) is included. This means that more than one quarter (about 400 thousand hectares), of the total agricultural area is currently idle. The share of idle land is expected to decrease, although parts of it will probably never come back into production. The share of idle land will decrease for two reasons. Parts of it will be taken into other use, and parts of it will be used for cultivation due to the increased need for cereals and fodder.

We should pay more attention to fields which are out of production and make use of their potential to produce alternative energy or afforest them. In order to prevent a rapid decline in soil fertility and the growth of weeds in the fields which are temporarily out of production, these fields should be conserved with an association of grasses (Vipper, H., Põder, I. et al).

Nearly the third of the arable land has been drained over the past 40 years, but as collective farms were dismantled after 1991, the drainage system lacked maintenance and, therefore, can often be found in a bad condition requiring investment. This also has a negative impact on yields. From the World Bank and national funds, a total of US$5.5 million has been made available for the maintenance of the drainage system. The Ministry of Agriculture has chosen the maintenance of its drainage system as one of its key investment areas. The use of heavy machinery lead to compaction and the poor structure of soils.

Plant and animal production

The share of arable land used by agricultural enterprises decreased from 1.019 million hectares in 1992 to 395 thousand hectares in 1996. In 1996, agricultural enterprises cultivated 45 percent of total arable land. About 40 percent of the land is used to grow cereals and 55 percent is used for forage crops. In 1997, the sown area of field crops was 864 191 hectares (0.6 percent larger than in 1996), while the sown area of grain was 335 241 hectares (14 percent larger than in 1996). The sown area of food cereals (rye, wheat, buckwheat) and legumes was 93 898 hectares (28 percent of the sown area of grain). The area under potatoes was 35 236 hectares (in 1996 35 285 hectares), and the area under open field vegetables 3 917 hectares (in 1996 4 245 hectares). Unused arable land amounted to 231 072 hectares (21 percent of the total arable land). In addition, agricultural enterprises still produced 52 percent of all cereals, although their cereal area was only half of the 1992 figures.

The production of vegetables is concentrated on private farms (50 percent) and household plots (41 percent). It is used largely for direct consumption by farm households. In 1996, the most important vegetables in open field production were cabbages (44 percent), carrots (17 percent) and red beet (13 percent).

Grains and legume accounted for 667 486 tonnes of dry weight in 1997 (4 percent more than in 1996), potatoes 437 466 tonnes (13 percent less than in 1996) and vegetables 52 310 tonnes (4 percent less than in 1996). The yield of grain and legumes was 1 991 kilograms of dry weight per hectare in 1997 (in 1996, 2 183 kilograms), the yield of food cereals and legumes amounted to 2 131 kg/ha (in 1996, 2 126 kilograms) and the yield of fodder grain was 1 937 kg/ha (in 1996, 2 205 kilograms). In 1997, the yield of food cereals and legumes was higher than that of fodder grain. The yield of potatoes was 12 415 kg/ha (in 1996, 14 176 kilograms). The production of grain was 458 kilograms and the production of potatoes were 300 kilograms per capita. Agricultural enterprises still have a major role in animal production. In 1996, they produced 57 percent of all milk, 48 percent of all beef, 70 percent of all pork and 64 percent of all eggs.

Under the Soviet regime, Estonia was an intensive animal producer. A significant share of production, which was based partly on imported low priced grain, was dedicated to Russia. If we look at longer period changes, then pig, poultry, sheep and goat numbers decreased by two thirds, perhaps more, up to January 1998 as compared to 1988 levels. The decrease in cattle and dairy cow numbers was only slightly lower. Last year the number of livestock decreased. The number of cattle decreased from 343 000 to 325 600, i.e. by 5 percent. The number of cows decreased by 2 percent. On 1 January 1998, cows accounted for 52 percent of the total number of cattle. In 1997, the number of pigs increased from 298 400 to 306 300, i.e. by 3 percent; the number of sheep and goats fell from 39 200 to 35 600, i.e. by 9 percent; the number of poultry grew from 2 324 900 to 2 602 000, i.e. by 12 percent.

In 1997, the production of meat decreased by 9 percent compared to 1996. The production of meat was 53 383 tonnes, of which the beef represented 18 983 tonnes, pork 29 547 tonnes, and poultry 4 357 tonnes. The production of milk was 717 149 tonnes (6 percent more than in 1996), the production of wool 120 tonnes (25 percent less), with the production of eggs amounting to 296 million (2 percent less). The average milk yield per cow was 4 210 kilograms in 1997 (3 809, in 1996).

In 1997, the gross agricultural output was EEK 5.51 thousand million at 1995 prices, i.e. 1.5 percent smaller than in 1996. In 1992, animal production accounted for 59 percent of gross agricultural output, but by 1996 its share had decreased to 51 percent.

During the last 20 years, 50-55 percent of the total harvest of crop production was received on account of inorganic fertilizers used. In 1988, the area fertilized with mineral fertilizers was 92 percent of the sown acreage, while in 1996, the coverage was only 31 percent. Manure was used on 10 percent of the sown area.

Figure 1: Use of fertilizers, 1996-1997

Source: Agriculture 1997

In addition, the intensity of fertilizers used per hectare was reduced significantly. In 1988, for the whole sown area, 250 kg/ha of NPK was applied; in 1996 the figure was only 25 kilogram. In 1996 Nitrate was used at an intensity of only 19 kilogram per sown hectare on average, and 62 kg per fertilized hectare. In 1996 as with the three previous years, the trend of agricultural cultures was in removing more plant nutrients from soil than were introduced into the soil with fertilizers. Hence, for example, in 1995 the rate of fertilizer use in Estonia dropped under the critical level. As a consequence, the fertility of the soil decreased significantly. In 1997, a slight recovery took place.

The use of pesticides declined fivefold, according to national statistics. In 1996, farm enterprises used 0.6 kg/ha of herbicides and 1.0 kg/ha of fungicides. Herbicides were used on 140 000 hectares in 1996. The application of an agro-technically correct fertilization and plant protection system is of great importance when speaking about increasing the crop yielding capacity of field cultures.

Factors affecting productivity and sustainability on farm level

Agricultural production has declined sharply during the last few years and the intensity of agricultural production has gone down. At the same time, prices of inputs increased rapidly leading to low purchasing power at farm level. This led to a decreasing use of fertilizers and pesticides.

Although a decline in the use of agrochemicals in production has had a positive impact on the environment, in the long run the old practices of heavily chemicalized production may be readopted, as farmers grow economically stronger and seek to enhance their profits by applying intensive technologies. This is the reason why environmental sustainability should be considered (Tisenkopfs,T. 1995).

Market conditions lead to economic differentiation of farms, often to a reduction in economic activity and bankruptcies on the part of small farms. The number of private family farms will continue to increase, but their importance, especially in animal production, will remain low. One reason for this is the limited availability of credit for private farms. A second reason is that the turnover of these farms is limited due to their small size, limiting also the amount of possible investments which can be made on an economically stable basis. Animal production is traditionally concentrated in agricultural enterprises. The share of private family farms in crop production will continue to increase, because the necessary investments are lower than in animal production. In addition, the input suppliers also provide short-term credits for farmers and the repayment takes place in the autumn by selling the grain to the input suppliers.

Agriculture and water protection

In Estonia the biggest share of water (84 percent) is consumed by industry. In second place is agriculture (9 percent). And around 7 percent of water is consumed by households. Estonia has extensive water resources. Groundwater is the main source of drinking water in Estonia, except in Tallinn and Narva where surface water is used. The majority of drinking water in Estonia meets EU standards, with some exceptions. There are three main actual problems concerning drinking water. In several areas the quality of water does not come up to standard for natural resources; the second problem is the pollution of groundwater with either oil products or nitrates; and the third problem is the amortization of water supply systems and a lack of drinking water treatment in several places. Surface water quality has improved since 1990. In the Soviet era, Estonia was an intensive animal producer, based on low-priced, heavily subsidized, imported inputs. Also, fertilizers and pesticides were highly subsidized. The high intensity of livestock production led to problems with organic fertilizer disposal. National statistics estimated that in the 1980s, 76 percent of the nitrogen load and 20 percent of the phosphorus load that leached into water bodies originated from agriculture. Under the Soviet era ground water became increasingly polluted. At the end of the 1980s, there was even the danger that large areas would have problems with usable drinking water. In 1996, out of the samples of drinking water, 9.4 percent did not meet health standards. After the spliting up of large farms into several units, the number of cattle decreased as well as the number of people in rural settlements. Many small treatment plants in rural regions stopped working. In addition to smaller water consumption for production, possibilities were found for saving water. Water was also saved in order to decrease the pollution charge. The high price of water in towns encouraged both industry and the population to save water.

Eutrophication is the nutrient enrichment of the water body often causing a reduction in water quality. Eutrophication can occur naturally or by the introduction of artificial pollutants entering water bodies. Agricultural chemicals, sewage, industrial and municipal waste waters, can contain organic compounds, nitrogen and/or phosphorus, all of which contribute to eutrophication. The organic, nitrogen and phosphorous concentrations in Estonian's rivers has decreased since the middle of 1990's. This is probably due to the improved purification of wastewater and the reduction of agricultural and industrial production. The levels are only just above the background levels normally expected for unpolluted rivers.

Agriculture and air protection

The main cause of acidification is the release of sulphur dioxide and nitrogen oxides into the air. These dissolve in rainwater and fall back to earth as acid rain. The main sources of sulphur and nitrogen oxides are industry and power production, although oxides are also released from transport. The main pollution sources in Estonia were the following branches: industry (69.7 percent), the building materials industry (6.6 percent) and the oil-shale industry (4.5 percent). The volume of pollutants from the building materials industry decreased about 300 percent during 1994-1996, but emission from the energy sectors increased in 1996. Between 1990 and 1996, the volume of SO₂ emission decreased by 50.9 percent, NO_x by 27.9 percent and the emission of solids decreased by 63.2 percent.

Air pollution is measured in several of the largest towns in Estonia and compared to the short-term maximums defined under regulations. NO_x pollution is largely attributable to traffic pollution, but SO₂ comes mainly from industrial pollution from stationary sources. Acidification or acid rain is not one of the most urgent environmental problems for Estonia, though there is a problem with alkaline precipitation and dust in the town Kunda in the north-east part of Estonia. Agriculture has not creating significant air pollution in Estonia.

Agriculture and its impact on landscape

Estonia's landscapes include agricultural, urban, agricultural and areas of wilderness. Estonia has a large proportion of natural landscapes including forests, coastlines and bogs. It also has man-made landscapes including farmland, towns and mines. Development exerts pressure on Estonia's natural environment. However, it should be noted that the area of land covered by buildings in Estonia is small compared to other European countries. Also, survey results show that the area of cultivated land in Estonia decreased between 1990 and 1995 as agricultural production declined during the first years of independence.

Not only can agriculture have an impact on the landscape. Among other activities, the most remarkable is the mining of mineral resources. About 887 million tonnes of oil-shale have been mined in Estonia since the beginning of the use of oil-shale deposit. Output related in peak in 1980; 31.3 million tonnes. Some 14.7 million tonnes were mined in 1996, of which 7.8 million tonnes by underground mining and 6.9 million tonnes by surface mining. Another 212 hectares of land was damaged during surface mining in 1996, while 273 hectares was recultivated. Almost 1 450 hectares (or 13.9 percent) of damaged land has not been recultivated.

Estonia is rich in peat lands with some 1 590 million tonnes of peat resources spread throughout the country. Estonia has used peat for hundreds of years, both as heating fuel and as fertilizer. Peat is considered to be a renewable natural resource provided that the rate of exploitation does not exceed that of growth. In 1996, 1 124 thousand tonnes of peat were mined. This is below the established legal limit and extraction is considered to be sustainable.

Agriculture and biodiversity

Biodiversity has been well preserved in Estonia and forms a very important natural asset, not only for the country but also for the region. The biodiversity of Estonian natural habitats is the country's greatest advantage in comparison with others of intensive and extensive agriculture. The realization of this advantage for diversifying agro- cenoses is the main precondition for the sustainable development of agriculture. This allows for an increase in the number of beneficial insects on farmland to favour the efficiency of pollinators and entomophages of pest insects. As a result of diversification, the productivity of both cultivated and natural plants increases, which will be the main precondition for nature and human saving agriculture (Martin, A.-J.,Mänd, M., et al.).

Estonia has a rich biological diversity, being home to a wide variety of wildlife species. Many endangered species, including the bear, lynx, greylag goose and bumblebee, live and thrive in the country. Those protected include 210 species of plants, 30 species of fungi and 299 animal species. Ten protected species found in Estonia are also included in the IUCN Red Book.

Effects of environmental degradation on agriculture

With decreasing agricultural land use, much more attention must be paid to non-agricultural land use (forestry, recreation, sewage disposal, wildlife preservation, protected areas). In Estonia, almost the third of arable land is drained. At the end of the Soviet period, more than half of plant production was obtained from drained land. Due to transition difficulties during the past seven to 10 years, no maintenance and repair work has been done on drainage systems. As a result of this, the functioning capacity of drainage systems has been decreasing and the water regime of drained areas has returned its pre-drainage state. On fields which need artificial drainage, the restoration of the natural water regime brings about a rebogging process and a decrease in the average crop yield. The yield loss has the general tendency to rise in time and, sooner or later, it obtains a unacceptable level for high-productive field rotation. This decrease obviously depends on the natural (pre-drainage) overwetting rate of soil (Soovik, E., Tomson, H., et al.). Areas nominally drained with tile drainage, but in reality reverting to bog can be used mainly for grassland or forest without expensive rehabilitation.

Simultaneous and harmonic development of soil management and animal husbandry is the most important precondition for sustainable agriculture in Estonian soil-climatic conditions. Unfortunately, many producers are forced by the market to specialize in cereal production, growing only a few crops. The monoculture of grain crops, with the simultaneous deficiency of manure decreases the humus content of the soil. The average annual reduction, caused by the monoculture of cereals, in humus reserves is approximately one tonne per hectare in the soils with medium texture (Vipper, H., Lauringson, E.. et al.)

THE INFLUENCE OF SOCIETY ON THE AGRICULTURAL ENVIRONMENT

Institutional change within the environmental policy

The Law on Sustainable Development, passed in February 1995, is the long-term strategy for sustainable development in Estonia. A number of regulations supporting this law have already been formed, but there is still plenty to do. Should Estonia gain associate status with the EU, we must take into consideration the same policy implementation. The main goals for developing sustainable agriculture in Estonia are:

• to ensure satisfactory income for farmers;
• to supply Estonian consumers with healthy food;
• to ensure stable employment opportunities in the countryside;
• to maintain traditional landscapes and natural values; and
• to protect resources (soil, water protection, energy conservation, conservation of biodiversity) (Sepp, M.).

The Estonian Monitoring Programme (EMP) gives a comprehensive assessment of the country's environment. One of the main tasks of the Environmental Information Centre (EIC) is to report on the state of the Estonian environment. An environmental information system based on indicators will make it possible to identify the data from the EMP and assess this information in a systematic way. In this context the Estonian Environmental Indicators System (EEIS) has been developed.

Many different frameworks to organize and structure indicators have been reported in different countries in recent years. The most thoroughly discussed framework is the "pressure-state-response" framework of the OECD (1993). This framework is chosen as a starting point of the EEIS because of its simplicity, wide acceptance and its applicability for reporting environmental problems. There are four types of indicators. With respect to the classic pressure-state-response model impact-indicators have been added. The impact indicators identify and quantify the changes in ecosystems and human health based on the conditions of the environment.

Coordination of the EMP should, in the first place, involve the collection of information that allows a description of the present state of the environment and predicts the future on the basis of the following aspects: the quality of environment; pressure on the environment; and environmental tolerance .

Environmental monitoring is to be a strategic instrument for environmental work and serve as a basis for political decisions on the environment. Simultaneously with environmental monitoring we must support environmental research, activity.

The Estonian Environment Information Centre of the Ministry of Environment is responsible for the coordination, administration and annual reporting of the EMP on the state level. Local environmental services are responsible for the implementation of regional monitoring. In 1996 the Estonian State Monitoring Programme included 60 sub-programmes and -projects with more than 1 600 monitoring stations all over Estonia,. Estonia has two international integrated monitoring stations; on the Island of Vilsandi (biomonitoring area) and at Saarejärve (intensive monitoring area). In 1996 the integrated monitoring site at Saarejärve relieved an automatic air monitoring station. According the Sustainable Development Act, environmental auditing is the assessment of the compliance of environmental management and activity with environmental requirements, good environmental experience and principles of sustainable development.

The purpose of environmental auditing is to identify the positive and negative aspects of an enterprise's environment-related activities. Auditing involves very different aspects, starting with controlling the compliance of an enterprise's activity with environmental legislation up to environmental management systems. Auditing provides for tight and motivated collaboration between the enterprise's administration and its auditor. The result of an internal audit is confidential and only a short summary is reported.

Toward a better system of standardization, the Estonian Standardization Board (EVS) has started to conclude contracts with production unions, ministries and other organizations, thus empowering them to implement standardizing in relevant fields. A contract between EVS and the Ministry of Environment was concluded on 14 October 1996. As provided for in the contract, the Ministry of the Environment regulates the substantial work involved in the process of compiling and establishing standards in the field of environmental management, environmental monitoring, environmental technology, environmental information, geographic information system, forestry, regional and municipal planning, building, building materials and products used for building.

At present, small countries seldom formulate original standards because it is time-consuming, expensive and often impossible due to lack of specialists. As a result, small countries usually take over regional and international standards (e.g. Finland and Sweden have taken over 95-99 percent of standards). It is essential to be aware of ISO standards as one of the CEN's principals is to formulate original standards only if the ISO has not already got one in the field. A survey of existing standards, or standards that are being prepared at present, are presented in a database, ISOPLAN, formed in the department of environmental impact assessment and environmental requirements of the Ministry of Environment. By the end of 1996, this database contained 274 entries.

Environmental policy related to agriculture

There has been rapid development in environmental policies in the Nordic countries. For farmers, the following factors have been important:

• the establishment of national parks and other protected areas with strict restrictions on the use of land; instance forestry, hunting and fishing. The regulations also include for the maintenance of biodiversity and the protection of agricultural landscapes, old farms or buildings, cultural monuments and historical places;
• strict governmental control on the use of pesticides and other chemicals in agriculture; and
• strict national regulations in order to prevent the pollution of groundwater, rivers and lakes. These regulations include measures to control soil erosion and the leakage of plant nutrients and pesticides.

In Estonia we have to follow the same factors.

During the last decade the area under protection has gradually increased. Estonia has four national parks and 217 protected areas. In addition, the West Estonian Islands Biosphere Reserve has international status. Estonia is an active supporter of nature conservation at an international level and has joined several international agreements related to biological diversity such as the Bern, Ramsar, Washington, Helsinki and Biodiversity Conventions.

Nature conservation is based on a system of protected objects, protected species and protected areas. The total extent of protected areas is 472 000 hectares, accounting for 10 percent of the country's territory. The main part of the protected area consists of landscape reserves.

Table 4: Protected areas 1996

Source: Agricultural Situation and Prospects...

Policy related to landscape and biodiversity aims to improve the protection of landscapes and the existing network of nature reserves in accordance with EU recommendations by the year 2000. Forests are considered to be one of the Earth's richest and most valuable ecosystems. Estonia has some of Europe's finest forest resources. The Estonian Environmental Strategy (1997), under the Maintenance of Landscape and Biodiversity policy, aims to establish a network of protected forests by the year 2000. These will be protected according to nature conservation criteria, thus, ensuring the preservation of all natural and semi-natural forest types and communities. Currently, some forests are protected. In other forests, timber production is of primary importance. The exploitation of these resources may tend to override the limits of sustainability and presents an important challenge for environmental policy. Current forestry data indicates that the volume of trees felled is less than the current growing stock of forests in Estonia.

Commercial fisheries, both marine and freshwater, are economically important in Estonia. Indicator species include Baltic herring, sprat, cod, pike-perch and perch. The International Baltic Sea Fishery Commission (IBSFC) regulates the exploitation of fish resources in the Baltic Sea. Commercial fish catches declined between 1980 and 1990 although increasing once more during, the 1990s. In order to avoid the over-exploitation of fish resources, the Commission established the annual Total Allowable Catch (TAC) for the Baltic Sea. Quotas are allocated to the national economic zones. A number of factors have caused the fisheries to decline to their current levels. These include general over-fishing in the past, pollution of near-shore breeding and nursery grounds, and a decrease in salinity in the Gulf of Finland.

The goal of the Estonian Environmental Strategy is to ensure the ecological balance of surface water bodies and coastal seas, the natural regeneration of fish-stocks and aquatic flora and fauna by the rational use of water bodies. The aim is to remove nitrogen compounds from the waste water of municipalities, in order to maintain the ecological balance of water bodies sensitive to nitrogen. The main policy framework in the Estonian Environmental Strategy is to ensure good quality ground water resources and its sustainable use and protection.

Legislative and institutional framework for a national agri-environmental policy

Environmental policy in agriculture follow international guidelines and initiatives, the guidelines of international conventions and agreements ratified by the Estonian government, as well as the guidelines of the Estonian Environmental Strategy. During the last few years, Estonia has signed several international agreements. The most important are: The World Nature Protection Strategy, Agenda 21 (adopted in 1992 in Rio de Janeiro at the UNO Environment and Development Conference), and the Action Plan for Central and Eastern Europe (adopted in 1993 in Luzern at the Conference of the Ministers of the Environment).

In 1995, the framework Act on Sustainable Development was adopted and will influence environmental legislation in the next few years. Besides drafting new laws, emphasis has been laid on enforcement through the means of enacting both governmental and ministerial regulations. In drafting laws and regulations, more attention has been paid to the approximation of Estonian legal documents with those of the European Union, thus, taking part in the approximation procedure of the associated environmental legislation with that of the EU. The following table gives a review of the work in the field of environmental legislation during 1990-1996.

Table 5: Environmental legislation during 1990-1996.

Source: Legislation in the Field of Environmental Protection

Among those laws adopted during these years the ones regulating environmental protection are: the Law on the Right to Use Nature Resources (1993), the Law on Pollution Damages (1993), the Forest Law (1993), the Water Law (1994), the Law on Protecting Nature Objects (1994), the Pollution Charge Law (1994), the Law on Sustainable Development (1995), and the Law on the Package Excise (1996). Estonia has started to develop the Estonian Agenda 21 as the Estonian National Long Term Sustainable Human Development Strategy for the 21st century. For example, for agriculture the priority is to preserve soils with high fertility and improve methods of land cultivation

Laws and directives on the use of inputs

The Plant Protection Law (1994) regulates the use of pesticides. In 1997, the Law on Organic Farming and Fertilizer Law was enacted.

Since September 1997, an Estonian Approximation Strategy concerning environmental legislation has been elaborated within the PHARE-programme. Legislative gap analysis, implementation analysis and investment analysis has started to harmonize Estonian environmental legislation with those of the EU, and to assess the necessary efforts to build up the institutional conditions for their implementation. This work also deals with directives related to agriculture and agricultural production, like the Nitrate Directive.

In addition, the Ministry of Agriculture runs, together with the County Environmental Departments, the Environmental Impact Assessment the (EIA). EIA is used to evaluate the effects of proposed projects on the environment. Assessment covers the food industry and, at farm level, facilities for animal husbandry with more than 10 cows or 30 pigs and corresponding cattle sheds and poultry farms.

Laws and directives on the protection of natural resources in agriculture

The 1994 law on water has had a very significant influence on agriculture. The regulation reduces nutrient leaking from agriculture through the following measures:

• regulation on animal density. The Maximum permissible animal density varies from 1.0 livestock unit per hectare in environmentally sensitive karst areas and environmentally vulnerable islands, up to 1.5 livestock units per hectare in other regions;
• fertilizer and manure application according to quantities and timing; and
• capacity of manure storage. Storage capacity should not be less than 8 months for cattle farms and 10 months for pig and poultry farms. Manure should be stored, spread, and handled in such a manner that it will not endanger surface and ground water quality.

National measures on the promotion of ecologically sound agricultural practices

By applying measures of environmental management, Estonia is put into a new situation where the main attention is now focused on promoting environmental awareness and making people understand that investing in environment protection is definitely worth while in the long-term.

The purpose of establishing charges on the use of natural resources was to receive money for the maintenance of natural resources. However, there is no information available if the money has been used for this purpose. In 1996, prices for the right to use mineral resources were increased by 2.5 percent of their sale price. The price for mine-water was increased by 200 percent. The price for using water of drinking quality from the Cambrian-Vendian ground water stratum for technological purposes has risen more than 200 percent (50 cents/m³ instead of 25). In order to reproduce natural resources, the money was allocated to those spots where these issues had to be dealt with directly. The share of payment received by local governments was increased.

Starting from 1996, the share not allocated to the local budget will be received by the Estonian Environmental Fund. From the Environmental Fund it goes towards the reproduction of relevant natural resource to the financing of environmental projects. In 1995, the revenue collected from pollution charges amounted to EEK 35.3 million instead of the expected 29.2 million. This included EEK 14.2 million for water pollution, EEK 6.7 million for ambient air, and EEK 14.43 million for waste generation. The increase in received pollution charges was due to the introduction of advanced registration practices for waste depositing and the new pollution charges effected by the Government Regulation No.412 of 29 March 1995. This regulation put more emphasis on public health and recreation possibilities. The pollution charge can be described as a complex indicator of the extent of pollution. According to this indicator, 80 percent of the total pollution volume in Estonia originated from some twenty enterprises.

During the first years of independence, most branches of agriculture proved to be unprofitable. Up to 1997, only a limited number of support measures for Estonian agriculture were effected. The main emphasis was on providing farms with loans at favourable terms. Compensation for the fuel excise tax was of a certain importance, so were measures to improve the quality of inputs used. By 1997, proposals for direct income support measures were not accepted despite the Agricultural Producers' Income Law. This was due to budgetary considerations in maintaining a balanced budget.

In 1997, new tools for Estonian agricultural policy were developed. The Rural Credit Guarantee Fund provides additional credit guarantee, and the Capital Grant Scheme supports investments of up to 30 percent of the investment amount. In 1998, Estonia launched direct income support measures. These are direct hectare payment and direct support measures for milk. For hectare payments, the requirements are a minimum of five hectares of supported crop. For the dairy payments, the preliminary requirements at farm level is to have at least five milking cows participating in, and registered under, the milk recording scheme and exceeding certain regional reference yields. In 1998, farmers also got subsidies from the government for crop failure due to bad weather conditions.

The importance of national environmental associations and organizations for environmental policy

The idea of sustainability was popular in Estonia at the end of the 1980s. It was resistant to the totalitarian Soviet system and it aimed at preserving Estonia, its nature, culture and people. The environmental "green movement" was the most popular movement. Later, however, a polarization took place. Some people concentrated on nature protection and others on political, social and economic issues.

Estonian Non-Governmental Organizations have a long history and have played a significant part in national development. The oldest is the Estonian Naturalists Society formed in 1853. In a general meeting in 1879, the academician G. Helmersen put forward the idea of protecting Estonian nature objects. The Tartu Student Nature Protection Circle (1958) is active in providing environmental education to students of the two universities in Tartu. The Estonian Green Movement (1988) was the first internationally active Non-Governmental Organization in Estonia.

The Estonian Fund for Nature (1991) operates as a partner-organization of the WWF (World Wide Fund for Nature), mainly raising funds for nature protection projects and carrying out field work on biological diversity in Estonian nature.

Here we can name only a few organizations dealing with environmental issues: The Association of Baltic National Parks, the Association of Teachers of Biology and the Geography, the Union of Protected Areas of Estonia, the Estonian Nature Conservation Society, the Estonian Society of Foresters, the Environmental Club "Scarabeus", and several others.

Several Non-Governmental Organizations (NGO) are engaged in agricultural and environment issues. The four main ones are: the Estonians Farmers Union, the Agricultural Producers Union, the Estonian Biodynamic Association and the Estonian Green Movement. Of these, only one is dealing with sustainable agriculture - the Estonian Biodynamic Association, which was established in 1989.

REFERENCES

Publications

Deverre, C. 1995. Social implications of agri-environmental policy in France and Europe, Sociologia Ruralis, no 2, pp. 227-243.

European Commission (DG VI). 1998. Agricultural Situation and Prospects in the Central and Eastern European countries, Estonia, (DG VI), Working Document, p. 70.

Järv, A. 1997. Land Cadastre Development and Land Reform Process, Agriculture in Estonia 1996, Jäneda Training and Advisory Centre, pp. 60-66, Jäneda.

Laansalu, A. 1996. Overview of Agricultural Policy and Strategy, Agriculture in Estonia, Jäneda Training and Advisory Centre, pp. 12-15, Jäneda, 1997.

Maadvere, E. 1997. Survey, Agriculture in Estonia 1996, Jäneda Training and Advisory Centre, pp. 39-49, Jäneda.

Martin, A.-J., Mänd, & M., Maavara, V., Islands of biodiversity - the main precondition for nature sparing agriculture, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 211-212, Estonian Agricultural University, Tartu.

Sepp, M. 1996. Agricultural policy and sustainable agriculture in Estonia, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 89-92, Estonian Agricultural University, Tartu.

Skutlaberg, A. 1996. Important factors for development of ecological and sustainable agriculture in Norway and the other Nordic countries, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 16-24, Estonian Agricultural University, Tartu.

Soovik, E., Tomson, H. & Jõgeva, V. Drainage preconditions for sustainable agriculture in Estonia, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 156-159, Estonian Agricultural University, Tartu.

Statistical Office of Estonia. 1998. Agriculture 1997, p.142, Tallinn.

Tisenkofs, T. 1996. Sustainability strategy in agriculture in the Baltic countries, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 25-34, Estonian Agricultural University, Tartu.

Vipper, H., Lauringson, E. & Kuill, T. 1996. Soil management in the missing of animal husbandry, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 167-169, Estonian Agricultural University, Tartu.

Vipper, H., Põder, I., Lauringson, E. & Kuill, T. 1996. Sustainable agriculture and natural preconditions for its development in Estonia, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 104-107, Estonian Agricultural University, Tartu.

Westerlund, K. & Loolaid, Ü. 1996, Foreword, NJC, Environment and Sustainable Agriculture, Proceedings, II international Conference of Agricultural Scientists from the Nordic and Baltic Countries, 24-25 November 1995, pp. 7-8, Estonian Agricultural University, Tartu.

Web sites

Acidification, [http://nfp-ee.eionet.eu.int/SoE/a/index_en.htm], 22 February 1999.

Atmospheric Air, [http://www.envir.ee/ehp/air.htm], 22 February 1999.

Biodiversity, [http://www.envir.ee/ehp/biodiv.htm], 22 February 1999.

Economic Instruments, [http://www.envir.ee/ehp/econom1.htm], 22 February 1999.

Environmental Management, [http://www.envir.ee/ehp/impact.htm], 22 February 1999.

Eutophication, [http://nfp-ee.eionet.eu.int/SoE/e/index_en.htm], 22 February 1999.

Fish Resources, [http://nfp-ee.eionet.eu.int/SoE/m/index_en.htm], 22 February 1999.

Forest Resources, [http://nfp-ee.eionet.eu.int/SoE/f/index_en.htm], 22 February 1999.

Legislation in the Field of Environmental Protection, [http://www.envir.ee/ehp/legisl.htm], 22 February 1999.

Mineral Resources, [http://www.envir.ee/ehp/mineral.htm], 22 February 1999.

National Environmental Monitoring Programme, [http://www.envir.ee/ehp/monitori.htm], 22 February 1999.

Natural Landscapes, [http://nfp-ee.eionet.eu.int/SoE/I/index_en.htm], 22 February 1999.

Non Governmental Organizations, [http://www.envir.ee/ehp/noncov.htm], 28 February 1999.

Peat Resources, [http://nfp-ee.eionet.eu.int/SoE/p/index_en.htm], 22 February 1999.

Quality of urban environment, [http://nfp-ee.eionet.eu.int/SoE/u/index_en.htm], 22 February 1999.

The Indicator Concept, [http://nfp-ee.eionet.eu.int/SoE/e/conc_en.htm], 22 February 1999.

Water, [http:// www.envir.ee/ehp/water.htm], 22 February 1999.