Agriculture continues to be a key sector for both the Romanian and European Union economies despite a constantly decreasing contribution to GDP and an increasingly low profitability, according to the Romanian AgriFood Startups Overview Report 2024, released by Impact Hub Bucharest in partnership with Startarium.

The agricultural sector's contribution to Romania's GDP was 3.9% in 2023 and 3.2% in 2024.

At the local level, the sector faces systemic challenges: outdated technology, low productivity, an aging workforce, and increasing climate risks, such as soil degradation and water shortages.

The report shows that Romania has 23% of the total agricultural workforce in the EU - 1.77 million jobs, the highest share in the Union). A total of 44.3% of farmers are over 65, highlighting the issue of an aging workforce. The analysis also showed that the percentage of women working in agriculture in Romania, 19% in 2021, the highest in the EU.

In 2023, when the available data were collected, there were 73 food-tech and agri-tech startups in Romania, a share of 4.6% of the local startups. Between 2018 and 2023, 18 rounds of funding were attracted, of which EUR 14 million was for the food-tech sector, and four rounds were worth EUR 1.6 million for the agri-tech sector.

The level of digitalization in Romanian farms is low, although the use of advanced technologies such as sensors, drones, satellite imaging or artificial intelligence would significantly increase the sector's profitability, the report shows.

Romania has approximately one third of all farms in the EU, but 90% of them are under five hectares, meaning they are subsistence farms.

"One of the main conclusions shows the very high potential of Romanian agriculture, which needs data, optimization of resource consumption (water, energy, fertilizers), and improving the yield per hectare to become profitable. Moreover, it is essential to encourage the formation of modern cooperatives, as well as other forms of collaboration that allow small farmers to access markets, technologies, and financing," Oana Craioveanu, CEO & Co-Founder of Impact Hub Bucharest & Startarium, said.

(Illustration: Impact Hub)

simona@romania-insider.com