According to the head of one of central Europe’s biggest farming businesses, Austria is home to the greenest, and perhaps greatest, most under-developed piece of infrastructure in all of the region: the Danube.
“The river Danube is like a ribbon — it connects people, it connects countries, and it connects cultures,” says Reinhard Wolf, chief executive of Raiffeisen Ware Austria (RWA).“But it could also be a much more highly efficient waterway for transport, and for trade.”
A single barge travelling down the river can carry the equivalent tonnage of 50 large trucks, Wolf says, and is also the single most carbon-friendly method of transport, tonne-for-tonne, in Europe.
Russia’s invasion of Ukraine has only highlighted the need for a more closely integrated transportation network to take goods — especially agricultural products — from east to west.
For now, though, the Danube remains underutilised.
Raiffeisen Ware, an Austrian farming co-operative, can see the potential having dominated the Austrian and central European agricultural market for nearly 125 years. Established to alleviate the hardships of farmers during the 19th century agrarian revolution, the organisation is now one of the region’s biggest agricultural concerns.
While it is primarily focused on supporting the needs of its 100,000 member farmers in Austria, it also runs a sizeable agricultural trading operation — largely focused on the former territories of the Habsburg empire — that this year accounts for a quarter of its projected €4bn annual turnover (up from €2.9bn in 2021).
Wolf has been chief executive for a decade, having spent his entire career with the company. And agriculture has never faced a more volatile period during his tenure. Russia’s war has driven up global food prices, benefiting many farmers, but it has also led to huge rises in the cost of energy and fertiliser, setting the stage for a crisis.
Coupled with a rapidly growing global population — and limits on the future scope to breed, engineer or chemically boost food production — the need for innovation and investment in farming has never been greater.
The Danube is one example in Europe of how agricultural supply chains could be better streamlined, Wolf says. For the moment, seasonal flows and stretches of poorly dredged channels mean the river is navigable for only half of the year, he notes. But, with the right investment to improve its shipping lanes, and the development of more terminals, docks and connecting infrastructure along its reach, there is the potential for it to be usable for use nine days in every 10.
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“Why we are not making this a priority I don’t know,” Wolf says. “We transport grain, oilseed rape and fertilisers along it already, but it’s also possible for anything else you could imagine: oil, iron . . . There’s currently no container line on the Danube, and you have to ask: why not?”
Raiffeisen Ware operates eight facilities on the river: four in Austria, one in Hungary, one in Serbia, one in Slovakia and another in Romania.
“In terms of making these countries more efficient, by improving export opportunities — which is obviously of great interest now, with the increases in food costs and the war — there have to be more investments in the waterway,” says the chief executive.
Europe’s energy crisis is an even more urgent problem. Even if it is shortlived, it threatens to permanently change the structure of the European agricultural market, Wolf says. He points out that once nitrate fertiliser plants — which depend on natural gas as their primary ingredient — have to shut down in the region, the economics could mean restarting them is no longer viable.
“We have to solve our energy problem, otherwise we will not be able to compete here in Europe. If fertiliser plants shut because they are no longer competitive, they will never reopen. We in Europe have to be very careful.”
Overall, the 62-year-old is sanguine that such problems can be tackled — particularly with the right investments in innovation. Raiffeisen Ware has weathered two world wars, multiple economic crises, and the redrawing of national borders but has endured, he says. Central and eastern Europe remains attractive to farmers, he adds, thanks to its good soils and agricultural heritage.
The co-operative is particularly interested in investing in new agricultural technologies and helping its members to access potentially groundbreaking innovations made by start-ups.
“In agriculture, we are already close to an optimum in fertilising and plant nutrition,” Wolf says. “We are nearing the limits in pesticides and plant protection. But there is a new avenue to develop and that is, firstly, everything in terms of digitisation and farm management and, secondly, in terms of precision farming.”
He points to the use of satellite navigation to guide tractors in fields as an example: in Austria, it has been supplemented by a network of radio beacons across the country mounted on Raiffeisen-run silos. Tractors have enhanced precision as a result.
“It’s a little easier for us in one sense, because you don’t have junctions in fields. But, in terms of precision, we are overall actually ahead of the automotive industry,” Wolf says. “I’m talking about tractors with 400hp and 30m spans of equipment that we can now drive over hundreds of metres to 2cm of precision.”