Profitability development of milk production on the Czech Republic in 2002-2010

This paper examines development of the Czech agriculture through profitability of the dairy - milk in time horizon 2002-2010. The analyse base of the methodology and the database published by Institute of Agricultural Economics and Information in Prague. The aim of the paper is to give an objective information about influence of agrarian policy on the development of milk production, especially with reference to comparison of changes in the pre-accession (period I = 2002-2003) and in the after-accession of CR to the EU with consistent producer prices of milk (period II = 2004-2008) and with reduced producer prices of milk (prediction of period III = 2009-2010). This deals with the economic position of Czech producers related to the most considerable livestock commodity of the Czech agriculture through 2 indicators, profitability without supports (R-S) and profitability with supports (R+S). There was proved that profitability R+S in the period I was negative for dairy sector. In connection with the membership of CR in EU agricultural supports significantly increased for dairy sector as the consequence of applying of Common Agricultural Policy (CAP) on the Czech agriculture. Therefore there were monitored in the period II important positive changes of the indicator R+S for milk commodity. In the connection with the decrease of producer prices in the period III there was found important downgrade of this indicator. For the Czech Republic there were obtained following milk production values of R+S in the period I, resp. II and III 2,1 %, resp. 10,8 and –7,4 %