Agricultural policies

In addition to technology, the earth needs a generational change

Companies led by under-35s are on average more productive - up to twice the national average - and more innovation-oriented

5' min read

5' min read

While there is increasing talk of 5.0 technologies in agriculture - as if to overtake 2.0 and 4.0 at a stroke - there is still no solution to a much more urgent and structural problem: the absence of young people. In fact, the hyper-technological future of agriculture is in danger of crashing against a reality that speaks of increasingly old farms, neglected land and a generational turnover that is unable to take off.

The numbers are clear. In Italy, according to Crea data and the most recent Coldiretti analyses, more than 45% of farms are managed by people over 65. Only 9% is in the hands of young people under 40. And if something does not change quickly, in the short term over 2.5 million hectares of agricultural land could remain without a tenant, in the medium term this figure could increase dramatically. This is not only an enormous economic loss, but also a deep wound to Italy's territories, landscape, biodiversity and food culture.

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In the last twenty years, our country has lost about 2.7 million hectares of cultivated land: an area the size of Lombardy that, piece by piece, has been abandoned. Not only mountains and marginal hills, but also fertile areas of the plains. A silent loss, which goes hand in hand with the ageing of farmers and the lack of attraction for new generations.

But why do young people not want (or fail) to do agriculture?

One could dismiss the question with a boomerish 'young people do not want to work', but this is not really the case, there are objective constraints. Firstly, there is a problem of access to land: agricultural land costs money, and it is often fragmented into small plots that make it difficult to use efficiently. Added to this is a difficult access to credit: the constraints imposed on banks in granting credit require guarantees that young people often do not have. Bureaucracy also does not help: between permits, calls for tenders and contributions to chase after, starting an agricultural enterprise can become an obstacle course. There is also the issue of training: many young people who approach agriculture do so without adequate support or educational courses that are truly in line with the needs of a sector that today requires managerial, digital and environmental skills. Then there are the children of farmers, those who have the land but have taken other paths because from birth they have been told that the land is even lower than they say. It happened in the families of small producers who struggled to make ends meet, but it also happened in the families with large farms whose children ended up studying at the best private universities in Milan or abroad.

Yet when young people manage to enter agriculture, they often make a difference. Companies led by under-35s are on average more productive - up to twice the national average - and much more oriented towards innovation, sustainability and diversification. Agrotourism, direct sales, short supply chains, on-site processing, digital technologies: these are just some of the activities that characterise young agricultural enterprises. Moreover, young agricultural entrepreneurs are often better educated than previous generations, with a cultural background ranging from marketing to robotics, from logistics to ecological transition.

The Common Agricultural Policy 2023-2027 has attempted to respond in part to this need, by providing specific premiums for the establishment of young people, as well as investment support instruments. But the tools offered by the CAP take us back to the infamous 'square 1': credit and bureaucracy. There are also contradictory signals: on the one hand, the recent abolition of the contribution exemption for young farmers, introduced in 2016 and then cancelled in 2024, risks undermining all the good that had been done. A backward step that increases the fixed costs for those who decide to start a farm.

This train that threatens to run over Italian (and European) agriculture we have seen coming from a long way off, today my fear is that it has already overtaken all the switches that could have caused it to deviate and turn back quickly. Reversing the trend would be possible, but it is a process that takes a long time. After having driven young people away - more or less voluntarily - an entire generation, probably even putting all the tools available today would not solve the situation in a short time. And then young people would have to enter the sector, open or take over farms, find their own space.

You can make access to land easier, through instruments such as land banks, you can study subsidised financing systems, you can streamline bureaucracy, you could do everything, but you need political will and time, too much time. Today we need a containment strategy and to rethink the role of young people in agriculture. Young people will become entrepreneurs again, but today we must give them the opportunity to gain experience, to grow professionally and to understand that agriculture is a business in its own right. Let us look at it from another perspective, that of opportunities.

Agriculture is a stable business, land is an almost guaranteed value and Italy offers distinctiveness and diversification of production. In a situation of global instability in the financial markets, many investors, large and small, also seek portfolio stability through investments in agriculture. To attract these investments, we need young entrepreneurs, startuppers, digitised, prepared, hungry managers. The change to be made is cultural: farming has always been a family asset in our country, but why can't it become a start-up business today? A green-field initiative in agriculture is also less risky than one in digital because it is often the land itself that guarantees the investment, in addition to the fact that there are quite a few productions in agriculture that can give Ebitda from the digital economy, in a practically tax-free sector. Paradox of paradoxes is that the further south you move in Italy, the higher the capital gain: the backwardness of agriculture in past decades now becomes an opportunity to buy land at reasonable prices and introduce high value-added and climate-change-friendly production such as tropical fruit, olive, almond and citrus groves that are technologically advanced and sustainable. And if you fear that large investments in agriculture could distort our Made in Italy, it is very unlikely: no investor would be so reckless as to jeopardise so many margins. Thanks to the defence of Made in Italy we have attracted the interest of finance, now we must create the conditions to ground this turn around of agriculture, faster, more effective and potentially the only short-term solution to avoid the worst.

It remains to be seen who will work in the fields...

Director Invernizzi Agri Lab - Sda Bocconi School of Management

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