HORIZONTAL TIES AS AN INSTRUMENT OF CONSOLIDATION OF THE MARKET POSITION OF AGRICULTURAL PRODUCERS

The development of horizontal ties among agricultural producers is the indispensable condition for the efficient functioning of the food chain because of the need to strengthen the bargaining power of the highly fragmented sphere of production. The small scale of production diminishes the chances for effective co-operation between the suppliers of raw materials and the processing entities, increases the costs of distribution and leads to considerable differences in the prices and quality of products. Judging by the experience of many EU-15 countries the co-operation of farms within the framework of formal groups of producers engaging in cultivation, storage, packaging, marketing and sale is an effective method of strengthening the bargaining position of producers having small batches of commodities at their disposal. The development of horizontal ties in Polish agriculture is progressing at a very slow rate. At present the largest number of producer groups is registered on the market of fruit and vegetables and the market of pigs. This is the reason why an analysis has been conducted to assess the process of horizontal integration of farmers in these two sectors.