and the associated unfavourable climate, as well as in most cases an isolated location.
Farms in such regions cannot compete with those in so-called ‘favoured areas’ and therefore are granted a compensatory allowance to make up for their poorer natural site conditions. In this way the maintenance of agriculture and the conservation of the landscape and, thus, settlement and infrastructure of these areas are to be ensured for future generations also in these regions.
The regions are usually shortly referred to as “Less Favoured Areas” and, depending on the type of handicap to agricultural use, comprise the “Mountain areas”, the “Other Less Favoured Areas” (“Intermediate Less Favoured Areas”), and the “Areas Affected by Specific Handicaps” (”Small Areas”). Less Favoured Areas (LFAs) account for about 80 % of Austria’s federal territory; Mountain Areas alone cover as much as 70 % of the Austrian cadastral area. A little more than 50% of the total agriculturally utilised area in Austria is located in Mountain Areas and about 7 % each in the two other area categories.
Whilst in the European Union Other LFA represent 36 % of the agriculturally utilised area, Mountain Areas 16 % and Small Areas 3 %, in the Alpine Republic of Austria the greater part of the Less Favoured Areas is - little surprisingly - classified as Mountain Area.
Agriculture in mountain areas has great regional, social and economic significance in Austria, as most of the agricultural and forestry holdings operate in these areas and substantially contribute to the preservation and care of this habitat. The work performed by these holdings also provides the foundation for tourism and the leisure industry, which generate an essential share of Austria's gross domestic product.
For mountain farms, dairy cow and cattle husbandry are by far the most important lines of production, with the most remote farms frequently relying almost exclusively on these – along with forestry. The growing focus on grassland use has increasingly deprived crop cultivation of its erstwhile significance, not least as a means for farming families to achieve highest possible degree of self-sufficiency.
Alpine pasture regions (pastures, forests, unproductive areas) cover roughly 20% of the total cadastral area, which brings home their major significance to Austria in terms of regional planning, economy and ecology. Alpine pasture grazing expands the fodder base of a farm, a larger share of the land can be used to grow winter fodder, as a result of which more head of livestock can be kept and the farm's economic bottom line can be improved.
Unfortunately, it cannot be ignored that dairy farming industry is gradually relocating to more affordable mountain regions, a trend that presumably gained momentum once the milk quota system expired. All that is left to do is to hope that appropriate initiatives in the marketing of dairy products, a diversification of income sources and the appropriate subsidisation of hard-working mountain farms will succeed in providing satisfactory income opportunities for the long term. In light of the major role mountain regions play in this country, sustained maintenance efforts in these regions constitutes a key factor in the preservation of Austria's cultivated landscape.
Other less favoured areas and small areas
Although, for the most part, the municipalities in the other less favoured area do not form a larger geographical unit and are frequently situated in geographical areas of transition, the small area is predominantly characterised by the hilly landscapes of South-Eastern Styria where the noticeably small-scale structure is reflected in a balanced distribution across the various production sectors.
Generally, it can be said that grassland management (dairy cow and cattle husbandry) predominates in the west on account of the climatic conditions and crop cultivation predominates towards the east owing to the low levels of precipitation.
Regulation (EC) No 1305/2013 on support for rural development provides the legal framework for the definition of these less favoured areas and for granting compensatory payments on account of natural disadvantages. Among other points, this Regulation stipulates that the long-discussed revision of the category "other less favoured areas", which aims to ensure consistent classification across the EU on the basis of natural disadvantage criteria, must be implemented by no later than 2018.