The Italian agricultural sector suffers from dependence on short-term political decisions, and farmers feel unprepared for future challenges. The ongoing dialogue with the stakeholders of the Invernizzi AGRI Lab at SDA Bocconi has highlighted the main critical issues: farms that are small in size, managerial skills that are lacking, and entrepreneurs who are aging. They see incremental technological innovation as the only path to improvement.
However, alternative paths do exist, and Italian farmers are not alone. The recent Census of European Farms highlights that these same challenges are widespread across the continent. This would suggest that the strategies identified by the Lab, which we’ll discuss below, could have a broader European impact.
Italian farms are, on average, very small (around 14 hectares according to ISTAT's 7th Census), but the European situation is even more concerning: 64% of farms have an average size of less than 5 hectares. Excluding high-value niche productions (more typical of Italy), what remains borders on subsistence farming, especially in Eastern Europe. So it’s no coincidence that, according to the European Census, 38% of farms produce mainly for self-consumption. In any case, these farms occupy only a small portion of agricultural land, which is taken up for the most part by larger farms.
Farms that reach a reasonable size aim to benefit from efficiency gains through economies of scale and hyperspecialization. In practice, large farms tend to focus on a single product, a production model that can be advantageous in stable markets but poses a significant risk in the agricultural commodities sector, which is increasingly subject to price fluctuations caused by external factors and speculation. Furthermore, since farms with the same productive focus tend to cluster in specific areas due to tradition and climate, market risks are compounded by climate risks. The loss of small farms threatens a loss of know-how, while the failure of large farms endangers overall European production and reduces self-sufficiency.
Beyond farm size and production models, the profile of farmers is another crucial issue. Farmers are predominantly male (62%), with 33% over 65 years old, 57% over 55, and 79% over 45. Only 6% are under 35, and even in this case, three out of four are men. In other words, there is no generational turnover.
Are there solutions? Yes, many—but first, we must acknowledge what could happen and what we want to prevent. Looking at the data, the only thing European agriculture does not seem to lack is productivity. Of course, it’s not on the scale of US agriculture or South America's mega-farms, but in some ways, that's a good thing. Over and over, we’ve seen proof of the limitations of large monocultures throughout modern agricultural history. What’s more, they’re disastrous for ecosystems. Opportunities for renewal and growth exist in European agriculture, but technology is just one piece of the puzzle - an almost useless one without the others. Technology does not make farmers younger, or turn them into entrepreneurs, or mold them into managers - yet that is precisely what we need right now.
Since 2019, the Invernizzi AGRI Lab has identified three key strategic directions:
· Farms need strategy, flexibility, and managerial skills - beyond technical expertise and intuition. A farmer becomes an entrepreneur by incorporating a strategic vision in which new skills open new development opportunities beyond traditional productions. We must honor the work of past generations who built the sector over the last 70 years, but what worked yesterday is not necessarily right for tomorrow.
· We must make agriculture attractive to young people. They possess the skills we need—precisely those skills that farming parents encourage their children to develop at top universities. The number of young people returning to family farms after earning management degrees is still too low, but when they do, the results are all success stories. And it's not just about managers; we need a motivated workforce with clear career growth opportunities. Agricultural businesses must develop structured management layers rather than remaining flat organizations with a single (male) figure at the helm.
· Production and farming locations must be diversified. Some countries, including Italy, are already experiencing consolidation, but it’s no longer viable to simply buy a neighbor's land and continue with business as usual. Research conducted with Crédit Agricole has demonstrated the fallacy of this approach in terms of profitability: beyond 150 hectares, profitability per hectare declines with each additional hectare acquired. To mitigate market volatility, climate risks, hyperspecialization, and size constraints, farms must diversify production—even by acquiring land in different areas. Large agricultural groups could be structured with profitable, sustainably sized farms distributed across the country and the continent. But this means being open to private capital, which sees agriculture as a promising investment but struggles to find farms with entrepreneurial vision, effective management, and willingness to engage.
Only by integrating technology with these elements can we truly renew the European agricultural sector. This will be the focus of the Invernizzi AGRI Lab’s efforts, supporting the transition – also toward sustainability - by providing the necessary tools.
