In Portugal, as in all European Union countries, the agricultural sector is composed of many farmers who are dedicated to family and small-scale farms, which operate independently. This is a quite different scenario from the reality of processing industries and retailers, which are highly concentrated.
This disparity requires instruments that reinforce the collective bargaining power of farmers. Producer Organizations (POs) make a difference in this evident power imbalance.
In 2006, and after obtaining recognition as a PO, Lusomorango had its first Operational Program (OP).
This European mechanism is based on the Common Market Organizations, which allow, in the case of the agricultural sector:
to strengthen the orientation of the agricultural sector towards the market and towards competitiveness
to implement practices that respect the environment and aim at the sustainability of agricultural activity and the territories where it takes place
to adapt production to market demands and consumer expectations
to improve the ability of producers to act in the face of crisis and market disruption scenarios
to ensure the best return for producers by merging the supply
to ensure and develop European consumers’ access to high-quality, food-safe fruits and vegetables
It was recognized by the European Community that many challenges of the production units could only be overcome if the Producers were concentrated, in an organized manner. Therefore, POs have the mission of diluting many of the farmers’ difficulties, scaling up a very fragmented business offering services common to these production units, increasing efficiencies.
Thus, POs provide financial incentives for the acquisition of factors of production, for the improvement of product quality, for marketing and for the implementation of measures that promote environmental protection.
Since 2006 Lusomorango has interpreted these incentives giving expression to all the basic elements of the OP. It is noteworthy that, of the total funds to which Lusomorango was able to access, about 65% were directed towards the acquisition of factors of production, irrigation equipment, structures, agricultural machinery, and plants, which has allowed the expansion of areas, the optimization of production costs and the stabilization of production prices.
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