Cyprus agriculture is transforming into a more efficient and value-added industry with the help of innovation and investment in renewable energy and smart tech, and with a business-minded younger generation keen to tap into the future potential of this sector. Fostering resource-efficient farming and focusing on quality rather than quantity are key aims as the government invests heavily in modernising and reorganising the overall agricultural sector with the help of generous funds available under the European Union’s Common Agricultural Policy (CAP). Over the last year, €102 million has been granted to Cypriot farmers via EU common agricultural policy measures, andthe Ministry of Agriculture has taken an active stance to further develop and support the sector through various programmes and subsidies. The country is determined to create a cleaner and greener Cyprus by adopting principles of sustainability.
Since 2018, Cyprus has introduced a number of initiatives to boost the sector in areas such as water and waste management, smart farming, environmental protection and new measures to ensure better animal welfare. In addition, the country is focusing on protecting and promoting quality traditional products worldwide, which will soon be marked with a new national and official ‘seal of origin’ to identify products made by the local agricultural sector using local raw materials.
As healthy eating trends have spread worldwide, Cyprus has seized the opportunity to achieve commercial success in niche markets by the systematic cultivation of long-overlooked fruit and vegetables – and bring back traditional local varieties of grapes to expand its rapidly developing wine industry. Long renowned for its citrus fruit, potatoes and olives, Cyprus is also becoming associated with high-value produce such as prickly pears, pomegranates, carobs, aloe vera and others that grow well in the island’s dry climate.
Over 50% of agricultural exports go the EU, followed by other European countries, the Middle East and Asia. Although unlikely that Cyprus’ agricultural sector will regain its high-performing levels of the 1960s, when it contributed 20% to the GDP, there is no doubt that its economic significance is set to grow rapidly in coming years. The value of agricultural production plunged during the 2012-2014 economic crisis but picked up again in 2015 and grew by an impressive 12% over the next two years. In 2017, the value of agricultural production exceeded pre-crisis levels, reaching nearly €740 million, accounting for 2.1% of GDP compared to 1.8% in 2014. Niche crops and traditional products unique to Cyprus are leading the way in this renaissance, with exports of halloumi alone showing an upward swing over the past six years, and increasing by 21% in 2018.
Due to the size of Cyprus it cannot compete with countries that produce huge quantities at low cost, but it can excel when it comes to quality, organic farming, bioproduction and superfoods. The decades-old success of the famous Cyprus potato provides a good example of what can be achieved by combining quality produce with strong marketing campaigns in key markets. The delicious flavour and quality, as well as their early harvest, make Cypriot potatoes one of the island’s most important agricultural export products constituting around 40% of total raw agricultural products. They get their winning flavour from the distinctive potassium-rich red soil of Cyprus. Around 96% of potato exports are to the EU, with main markets in 2018 being Greece at 36%, the UK at 20% and Germany with just over 13%.
At the same time, there is less cultivation of various types of citrus fruit. Exports of these were hit around a decade ago after the EU reduced tariffs on imports of citrus from third countries in the Mediterranean such as Morocco, Egypt and Turkey – where labour costs are far lower and production volume significantly greater. Farmers dedicated to citrus were encouraged to shift to varieties that perform well in export markets, such as the tango orange and lemons. Government incentives are in place for farmers to also replace citrus trees, which require a lot of irrigation and expensive pesticides, with hardy crops that naturally thrive in dry climates, such as vitamin-rich fruit like pomegranates and prickly pears, which are now available and command good prices in every supermarket. The medicinal oil from the seeds of prickly pears can sell for up to €40,000 a litre, proving that developing these types of fruit can be a highly specialised and lucrative business. In addition, aloe vera holds much potential and is being cultivated mainly in the Pissouri area near Limassol by producers who have formed an association and use it to make beverages, skin lotions and cosmetics.
The health benefits of olive oil is no secret, but one Cypriot farm is garnering worldwide attention for its oil. The positive effects come from the number of phenolic compounds, and Atsas olive oil has by far the highest number of these compounds ever recorded worldwide. The oil, which is exported to Russia, Canada and the US, has attracted the attention of the scientific world who are researching the benefits of high phenolic olive oil in lowering cholesterol and combatting cancer. California’s UC Davis research institute is now running clinical tests in the anti-inflammatory effects of the oil, and the University of Athens school of pharmacology started clinical tests on Alzheimer’s. More recently, the prestigious Yale University announced its interest in researching the Cypriot oil. The philosophy of the organically certified Atsas farm, run by French environmental engineer Nicolas Netien, is to use agroecology design to create agricultural systems which have the diversity, stability and resilience of a natural ecosystem. The idea is part of the new regenerative agriculture movement which is gathering momentum around the world, and for now the Cyprus-based environmental engineer remains a pioneer in the field.
Innovation has helped revitalise traditional minor crops, or ones that were set aside by the advent of high-intensity cropping systems. For instance, a current joint effort spearheaded by the University of Cyprus (UCY), the Agricultural Research Institute (ARI) and the Central Chemistry Laboratory, is screening the indigenous carob genetic resources and developing food, beverages and medicinal products of high added value. Once dubbed ‘black gold’, but gradually abandoned over the decades, carobs are making a strong comeback. Under the UCY project, 6,000 carob trees were planted in November 2017, with another 34,000 to follow on land leased from the forestry department in Orites, Paphos, for what will be the island’s biggest organic carob plantation.
The ARI is also conducting research on how Cyprus can produce a bigger biodiversity of crops while improving yield, quality, resilience and taste. The objective is to increase the biodiversity in agricultural ecosystems by looking at traditional species no longer grown in Cyprus, as these old species – genotypes – have suitable characteristics to diversify crops and also improve the quality of products that can be enjoyed by consumers. Scientists from this European research project are testing an experimental breeding technology aimed at identifying plants adapted to Cyprus’ scorching heat and lack of water. In an experimental field that covers some 11 hectares, more than 20 varieties are grown, including corn, barley, ancient wheat, chickpeas and cowpeas. The more promising candidates will be naturally crossed among them to produce drought-resistant varieties. The project’s aim is to help local farmers expand their offering to potential new markets, and researchers predict that new crops could become a market reality in Europe by 2023.
Funding the Future
Significant investment is helping to overhaul the agricultural sector, with a rural development programme co-funded by the EU and Cyprus, 52% and 48% respectively. More than €485 million is expected through the Common Agricultural Policy (CAP) between 2014 and 2020, with further funds for modernisation and development under the new CAP from 2021 to 2027. The programme is open to all sectors for investment in the primary and secondary sectors, including organic farming, training, promotion, agritourism and applying for Protected Designation of Origin (PDO) or Protected Geographical Indication (PGI) status.
To promote the quality of Cyprus’ agricultural products, the government has pushed to register more PDOs and two other international quality logos that attest to specific traditions and qualities of food, agricultural products and wines. Like the PDO, the PGI denotes a specific link to a region’s product while the third logo, the Traditional Speciality Guaranteed (TSG), highlights a traditional production process. There is growing interest to gain these unique badges of quality because they bring added value to any produce, especially as European consumers are prepared to pay more for well-sourced food and ingredients. Cyprus has five food products already registered as PDOs, and four products have PGIs, with more applications for both PDO or PGI certification in the pipeline. In the wine category Cyprus boasts the famous Commandaria, which is said to be the earliest known wine brand in the world. In addition, Zivania and Ouzo are potent alcoholic beverages listed as PGI products since 2004.
Growing Appetite for Halloumi
Halloumi has become one of the country’s most formidable trademarks worldwide. The value and quantities of halloumi shipped around the world has grown every year, and in 2018 Cyprus exported 30 million kilos worth €194 million to over 40 countries worldwide – and with more markets steadily being opened for exports, these figures are sure to grow further in the coming years. In fact, producers predict that exports will reach over €300 million by 2023. Demand for halloumi has been surging across Europe and Asia, which led to an export deal with China and a consequent shortage in the UK where halloumi prices soared by 12% in May 2019.
To protect the heritage of the cheese, the name ‘halloumi’ is now registered in the European Union as a Community Collective Trade Mark. In a legal ruling in London in November 2018, halloumi lost its Certification Trade Mark in the UK, but retains it in the EU and a number of other countries, including the US. It also holds this classification in Jordan, and the Ministry of Commerce is in the process of registering it in other Middle Eastern countries. Cyprus is also awaiting the classification of halloumi as an EU PDO in 2019, which would boost and protect the product and its brand appeal.
The government is investing €35 million to increase production of sheep and goat milk from which halloumi is traditionally made, and the number of sheep and goats is to be increased by 35,000, boosting milk production from three to 14 million cubic litres a year by 2020. Grants of €20,000 are available under an EU programme for first-time farmers aged between 18 and 40 who raise these animals, attracting educated young people into an area with a bright future. Production of the famous white cheese is now also associated as much with laboratories as it is with a rustic lifestyle. A further boost will come in late 2019, with the expected launch of yet another government programme to support sheep and goat farming and the installation of desalination units for farmers.
Growing Aquaculture Industry
Aquaculture products are the third most important produce in Cyprus, in terms of export value. There are nine licensed marine open sea cage farms in operation in Cyprus culturing mainly European seabass and gilthead seabream, three marine hatcheries, one land-based shrimp hatchery/farm and seven small trout farms. In addition to private fish production units, there are also two government-operated aquaculture research stations, one for marine species and the other for freshwater species.
Marine fish production (mariculture) in open sea cage farms accounts for some 90% of the total sales value, and steady growth in this sector due to strong marketing on both a local and international level is likely to attract further investment. The main commercially cultured marine species are the gilthead seabream and European seabass, accounting for around 70% and 30%respectively of total production. Total aquaculture production in 2017 reached 7,277 tonnes of table size fish including 28 tonnes of shrimp, 44 tonnes of trout, and 31.8 million marine fish fry were produced. The aquaculture sector represents about 75-80% of the total national fisheries production in terms of both volume and value. Fish export value – including live, fresh, chilled or frozen fish – was €31.2 million in 2018, with Israel absorbing 75% of the fresh fish exports. Around 65% of the total national production of marine species is exported to markets in Europe, the Middle East and the US, with the rest consumed domestically.
New Wines with Ancient Roots
The wine scene has developed dramatically in recent years, with now around 70 wineries growing vines and producing award-winning wines in the foothills and high-altitudes of the Troodos mountains – establishing someas the highest altitude vineyards in Europe. Some wineries have also focused on preserving the heritage of indigenous Cypriot varieties and are developing exciting and complex boutique wines.
Cyprus has been producing wines since 3,500 BC which were widely traded in the Eastern Mediterranean region and the Aegean Sea. Perhaps the best known ancient variety of Cyprus wine is Commandaria, a unique dessert wine made from sun-dried Xynisteri and Mavro grapes and reputedly enjoyed by Richard the Lionheart on his way to the crusades. The wine holds the distinction of the world’s oldest named wine still in production and is documented as far back as 800 BC, while the name Commandaria dates back to the 12thcentury crusades. In the 1980s the country embarked on a campaign to eradicate local grapes in favour of foreign varieties, such as Chardonnay, Sauvignon, Merlot, Grenache and Syrah in the belief that they would be more exportable. Fortunately, the trend was reversed after Cyprus joined the EU in 2004 and with the Union’s focus on highlighting local produce of its member states. A programme was adopted to save native varieties that have been grown for centuries and were in danger of becoming extinct.
Efforts to save the heritage of Cypriot viticulture has seen enormous success, and with the country now producing interesting vintages, the reputation of Cyprus wine and this new territory is growing rapidly worldwide. Four different wine regions have been designated as producing their own unique product with controlled appellations of origin. In each case, different proportions of indigenous Cypriot red grapes such as Maratheftiko, Ofthalmo or Mavro, or the white grape Xynisteri, are blended with smaller quantities of specified foreign varieties such as Cabernet Sauvignon, Cabernet Franc, Syrah or Merlot. The unique native varieties and local character of Cyprus wines reflect the country’s terroir – which is also one of the few places left in the world that is free from phylloxera, the pest dreaded by winemakers worldwide.
The government has recognised the budding success of this sector and is working hard to popularise Cypriot wine in the European market. To give a further boost to the sector, the government announced €23 million would be made available to the local industry through the National Viticulture Support Programme for the period 2019-2023. Many vineyards today are run by young entrepreneurial Cypriots with solid training in viticulture and oenology from famous winemaking regions such as France, Italy and Australia. This along with the establishment and promotional work of an association of 11 leading Cypriot wineries – branded the Ambassador Wineries through the Evoinos partnership programme – are definitely putting Cyprus’ wine territory on the map for international wine connoisseurs.
Showcasing the rich viticulture of the island, Cyprus has created a wine trail project, offering six different organised routes for visitors to tour the island’s wine-producing regions. The reputation of the annual Limassol Wine Festival, launched in 1961, has also spread beyond the country’s borders and attracts over 100,000 visitors every August to the city’s municipal gardens to discover the wine portfolios of one of the world’s oldest wine-producing countries.
Opportunities and Challenges
Agriculture in Cyprus is rapidly diversifying and modernising, with greater input from scientists and researchers. This, together with the successful experience of those who have put money into boutique wineries, aquaculture or cultivating plants that produce nutritious and medicinal fruit will attract further investment. Demand for such products in niche domestic and export markets is steadily rising because of the increased interest in well-sourced, nutritious food and the growth of European vegetarian and vegan communities. Most of these fashionable foods come from hardy plants that thrive in Cyprus’ climate and wider cultivation of such crops will help to address the challenge of water scarcity, a pressing problem over the centuries. Farmers have enjoyed greater water security in recent years thanks to the latest desalination and recycling technology. Also, many of these crops do not require large land holdings, which again suits Cyprus where around 90% of holdings are under five acres and most farms are owned and run by individual families.
Climate change is undeniably one of the biggest challenges facing Cyprus and the entire region, and the agricultural sector has felt the effects first hand. For example, €16 million in compensation has been paid out by the government to cover losses deriving from damage caused by extreme weather. This reality has placed research at the heart of finding solutions to fight the effects of global warming. To this end, Cyprus along with 15 other countries has launched an initiative to create a new climate change action plan. The research and recording of relevant measurements in the region will be led by the pre-eminent and globally renowned research organisation the Cyprus Institute (CyI), and the data gathered combined with the scientific expertise is expected to result in new ideas and solutions. Currently there are around 55 research projects in various stages of completion in Cyprus thanks to the numerous research centres and universities leading the way in innovation.
New trends in farming methods and produce are helping to address another challenge that Cypriot agriculture has long faced, the ever-increasing average age of farmers. Younger educated people are now entering what is seen as a cutting-edge sector and many also have the marketing skills to make their agribusiness a success – changing the image of farming. The University of Central Lancashire (UCLan), the first British university to establish a campus in Cyprus, now offers a popular diploma programme in agriculture and animal husbandry, and the numerous private and university-led research projects and initiatives are also enticing the younger generation to explore opportunities in the sector.
Another interesting initiative is the recent legislation allowing for the cultivation and trade of medical cannabis. Apart from the benefits it would bring patients – a number-one priority – it would also bring a boost to the economic development of the island, as well as attract significant foreign investment for the entire production chain.
A Fertile Future
Agriculture in Cyprus is blossoming again as resilient and resourceful farmers, with government support, respond to fast-changing trends in the European market. Worldwide demand for agricultural technology will explode in coming years, and start-ups and research centres are working more closely with farmers for fresh ideas to transform agribusiness in Cyprus.Innovative thinking focused on quality and sustainable environmentally-friendly methods are filtering into the sector, while the younger generation’s skilful marketing of more PDO and PGI products is supporting the growth of unique exports. With these developments the sector is enjoying bright prospects and a full image rebrand.
For more information, contact Cyprus' investment promotion agency, Invest Cyprus.
All rights reserved. The material on this site may not be reproduced, distributed, transmitted, cached, or otherwise used, except with the prior written permission of CountryProfiler.