2. Israel’s rural sector is trapped
in the dilemma of
central planning versus free market
3. Current trends in Israeli agriculture
Constant worsening of trade conditions
Output Input Trade
prices prices conditions
4. Farmers’ survival depends on
technological efficiency and
return to scale
However:
Israeli farmers face here the
constraints of central planning
5. About 90% of land in Israel is
state-property
This is partly the heritage of Turkish
control over the country, that ended in
1918…
6. Getting hold of land for cultivation is
restricted by laws, regulations,
committees, and other bureaucratic
means…
7. Land use in Israel („000 dunam)
Total land: Of which: Cultivated Of which:
land:
21,942 Built area 2,000 4,200 Irrigated 2,200
Military use 10,620 Non-irrigated 2,000
Open space 9,322
8. Most of the villages in Israel are
communal or cooperative
where land is owned jointly by all
farmers together
And is managed by the village
farmers’ association
No. of cultivated
land
Moshavim (cooperative villages) 402 43.4%
Kibbutzim (communal villages) 306 25.3%
Non-cooperative villages 244 31.3%
Total 952 100%
9. State-owned land is allocated to
communal and cooperative
villages according to “farm
units” (Nachala)
10. The farm units are leased to the farmers’
association
which manages their cultivation (in a kibbutz)
or allocates them to farming households (in a
moshav)
The size of the farm unit and the number
of farm units in each village is
determined by the Ministry of Agriculture
The farm unit is about 30-70 dunam in size
All farm units of one village are the same size
11. The size of the Israeli “farm unit” is compatible to
the size of Mediterranean farms
100
90
80
Average farm size (dunam)
70
60
50
40
30
20
10
0
Israel Greece Italy Portugal
12. Can a farmer make a living of this farm unit?
Example: Shamuti orange grove
Average annual income per dunam: 71.5 €
Average annual income per farm unit of 50 dunam: 3,575 €
298 € per month!
440 dunam of citrus groves are needed
In order to provide for the average income of an
Israeli family
13. Rights and obligations associated with ownership of
a farm unit in a cooperative village( Moshav):
• The land is leased for very low rate- about 130 Euro / year
for the whole farm unit
• The farmer must live on the farm and is allowed to build up
to 3 residential units on it, for use of members of his / her
family only
• It is prohibited to divide the farm unit or unite a number of
farm units together.
• Only one descendant can inherit the farm unit
• The farmer is not allowed to sub-let the farm unit
• The farmer must actively cultivate the land – otherwise the
state can take back the land and lease it to anther farmer
14. And above all:
• The farmer does not hold any legal ownership over the
farm unit!
• The land is owned by the state and leased to the farmers’
association. The farmers are not part of this contract!
15. Although not officially allowed, in practice
sub-lease of farm land is common practice
in Israel….
16. In conclusion
Two systems influence land activity
in rural Israel
Formal Informal
Centrally planned Market-oriented
Israeli farmers are trapped in the dilemma
of obeying the law
versus
the survival and prosperity of their farm
