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   Historically, Portugal's agricultural efficiency, measured in terms of crop yields and animal productivity, has been well below that of other European countries. Agricultural inefficiency is a consequence of Portugal's topography and climate, which varies considerably from north to south and has influenced farm size and farming methods. There are three major agricultural zones: the north, center, and south. The north (the area between the Douro and Minho Rivers, including the district of Trás-os-Montes) is mountainous with a wet (180-249 cm of rainfall/year), moderately cool climate. It contains about 2 million hectares of cultivated land excessively fragmented into tiny (3-5 hectares) family-owned farms, or minifúndios, a consequence of ancient settlement patterns, a strong attachment to the land, and the tradition of subdividing land equally among family members. The farms in the north produce the potatoes and kale that are used to make caldo verde soup, a staple of the Portuguese diet, and the grapes that are used to make vinho verde (green wine), a light sparkling white wine said to aid the digestion of oily and greasy food. Northern farms are too small to benefit from mechanization and their owners too poor to invest in irrigation, chemical fertilizers, or better seeds; hence, agriculture in the north has remained labor intensive, despite efforts to regroup minifúndios to increase farm size and efficiency.

   The center (roughly between the Douro and the Tagus River) is bisected by the Mondego River, the land to either side of which is some of the most fertile in Portugal and produces irrigated rice, corn, grapes, and forest goods on medium-sized (about 100 hectares) farms under a mixture of owner-cultivation and sharecropping. Portugal's center contains the Estrela Mountains, where sheep raising is common and wool, milk, and cheese are produced, especially mountain cheese ( Queijo da Serra), similar to French brie. In the valley of the Dão River, a full-bodied, fruity wine much like Burgundy is produced. In the southern part of the center, where the climate is dry and soils are poor, stock raising mixes with cereal crop cultivation. In Estremadura, the area north of Lisbon, better soils and even rainfall support intensive agriculture. The small farms of this area produce lemons, strawberries, pears, quinces, peaches, and vegetables. Estremadura also produces red wine at Colares and white wine at Buçelas.

   The south (Alentejo and Algarve) is a vast rolling plain with a hot arid climate. It contains about 2.6 million hectares of arable land and produces the bulk of Portugal's wheat and barley. It also produces one of Portugal's chief exports, cork, which is made from bark cut from cork oaks at nine-year intervals. There are vast groves of olive trees around the towns of Elvas, Serpa, and Estremoz that provide Portugal's olives. The warm climate of the Algarve (the most southern region of Portugal) is favorable for the growing of oranges, pomegranates, figs, and carobs. Almonds are also produced. Farms in the south, except for the Algarve, are large estates (typically 1,000 hectares or more in size) known as latifúndios, worked by a landless, wage-earning rural work force. After the Revolution of 25 April 1974, these large estates were taken over by the state and turned into collective farms. During the 1990s, as the radicalism of the Revolution moderated, collectivized agriculture was seen as counterproductive, and the nationalized estates were gradually returned to their original owners in exchange for cash payments or small parcels of land for the collective farm workers.

   Portugal adopted the Common Agricultural Policy (CAP) when it joined the European Union (EU) in 1986. The CAP, which is based on the principles of common pricing, EU preferences, and joint financing, has shifted much of Portugal's agricultural decision making to the EU. Under the CAP, cereals and dairy products have experienced declines in prices because these are in chronic surplus within the EU. Alentejo wheat production has become unprofitable because of poor soils. However, rice, tomatoes, sunflower, and safflower seed and potatoes, as well as Portuguese wines, have competed well under the CAP system.

    See also Minifúndios, Latifúndios, European Union.