The problems of financing in agriculture are particularly critical because of the amount of capital tied up in each output unit. This tends to increase with time and makes the branch in question resemble heavy industry. Moreover it is a declining activity whose prices, compared to those of other branches, evolve unfavourably. The considerable burden of land prices makes investment problems even worse for the farmers. The comparison of agricultural and industrial firms indicates that the position is particulary difficult for farmers whose system is based on cattle production, for in such systems capital investments bring in a positive profit only above 20-50 hectares, unlike the cereal producing system whose high profitability is comparable to that of industrial firms. But farms have relatively few debts. Finally, the farmers' difficulties as far as financing is concerned are increased still more by the necessity to constitute reserves because of the precarious nature of this activity. In conclusion, the general economic evolution combined with the farmers' very slight self-financing possibilities, the country's industrialisation policy and institutional factors lead to a very pessimistic view of investment in agriculture.
