Poland: agricultural news week 39

Animal Protection Law passed Lowerhouse

On September 18, the draft act amending the law on Animal Protection passed the Lower House (Sejm) with 356 votes for, 75 against and 18 abstaining. The draft act is called Five for Animals and was initiated by the chairman of the ruling party Law and Justice (PiS) following undercover recordings from a mink farm with alleged cases of animal abuse (see also our newsletter of September 11). Five for Animals will now be discussed in the Senate. This week, public hearings have started and it is expected that the Five for Animals act will be voted on in the Senate on October 13. If the Senate would pass the draft act, the president could still veto the Five for Animals act.

Most of the rules will come into force 30 days from the date of announcement. The Five for Animals act includes the following:

1. Ban on fur farming, with the exception of rabbit farms, with a transition period of 1 year. Banned entities are entitled to compensation from the state budget for discontinuing breeding or breeding fur animals.
2. Ban on ritual slaughter, with the exception of production for the national religious communities. Entities performing economic activity in the field of animal slaughter carried out in a special manner provided for by religious rites of religious associations are entitled to compensation from the state budget for the restriction or discontinuation of this activity.
3. Ban on using animals for entertainment, including a ban on use of animals in circuses.
4. Ban on keeping animals for longer than 12 hours on short leashes or chains, coming into force after 6 months. 
5. New regulations for animal shelters; shelters are to be run by local government units or public benefit organizations and frequent inspections are to be introduced with focus on the living conditions.

The rules for the announced compensation have not been given.

The minister of Agriculture, Ardanowski, voted against the Five for Animals Act. As a result he was suspended from the PiS party but remained minister. Within the coming two weeks, announcements on a reshuffle in the cabinet are expected.

LAN-WAR own report- CS

COVID-19 financial aid for farmers prolonged

The Agency for Restructuring and Modernization of Agriculture extended until 7 October 2020 the deadline for accepting applications for support for farmers whose farms were affected by the COVID-19 crisis. Originally, the deadline for submitting application was 9-30 September 2020.

So far, the Agency has received over 148 000 applications. The aid covers farmers working in the sectors of beef cattle, dairy and mixed utility cows, pigs, sheep, goats, slaughter poultry, laying poultry and ornamental plant cultivated in heated greenhouses or heated foil tunnels. Details can be found here.

The support financed from the RDP 2014-2020 budget takes the form of a one-off lump sum payment, and its amount depends on the type and scale of agricultural production. The maximum amount of aid for a farmer may not exceed EUR 7,000.

In total EUR 270 million was allocated for this aid, i.e. slightly over PLN 1 billion, with applications for support approved and paid by 31 December 2020.

Source: agropolska.pl

Apple season has started

The apple season in Poland has started. The drop in the price of dessert apples is caused by a temporary surplus of goods on the market. Had the fruit been held for trading for months to come, the price would not have fallen that much. Traders take advantage of this situation. Supermarkets, having the opportunity to buy tons of apples a day, lower their in-buy prices.

That is why the Fruit Growers Association organized a picket in front of the headquarters of Jeronimo Martins, the owner of Biedronka - the largest retail chain in Poland, as part of a protest against the rapidly falling apple prices. In their opinion prices of apples are dropping significantly from week to week, i.e. for those who deliver fruit to various recipients, especially to retail chains.

In the opinion of fruit growers, corporate social responsibility has been completely ignored in the trade policy. The strategy only takes into account the interests of retail chains. Growers who incur the largest financial outlays receive relatively the lowest payment for their work, the consumer pays a fixed price for the goods, and the difference goes to the intermediaries' account. In the era of the pandemic, apples have become a popular fruit, and the networks are treacherously using their position on the market to derive excessive benefits, protest growers say.

In the period from March to June, the prices of apples were increasing every week, sometimes even by one zloty per week in the Polish supermarkets. Traders wanted to get more goods and the market had so much supply. Therefore, there has been a very sharp rise in prices. From the second half of August, prices began to decline, but this is related to the start of the new season and the harvest of this year's apples.

But the problem lies also the lack of refrigeration facilities. Many fruit growers in Poland still do not have refrigerators and packages, so they sell apples directly after harvest, usually at unfavorable prices. Those who are better equipped put the goods in the cold store and wait this period.

The estimation is there will be several percent less apples on the European market the coming season than the average, and it may happen that in the next spring again there will be no fruit on shelfs.

Source: SadyOgrody.pl, Sadownictwo.com.pl, sad24.pl

Growing Polish food export

During the first 7 months of the year, Poland exported food worth EUR 19.2 billion, which is 6.4% higher than last year. Polish products go mainly to EU countries – the National Center for Agricultural Support (KOWR) informed.

- The value of exported goods is growing year by year, and agriculture is an industry with a positive balance in foreign trade for our country. Polish agri-food companies successfully compete not only on the domestic market, but also around the world. Even during the coronavirus pandemic, they are effectively fighting for participation in foreign markets - emphasized Marcin Wroński, Deputy Director General of KOWR.

From January to July 2020, the sale of agri-food products abroad reached the value of EUR 19.2 billion, EUR 1.2 billion more than a year earlier, which means an increase of 6.4%. The increase in exports was primarily influenced by very good results of foreign sales in the first quarter of this year and growing exports in June and July this year.

As noted by KOWR, the increase in exports was caused by the depreciation of the Polish currency zloty against the euro and the US dollar in the first quarter of this year and the zloty exchange rate still favorable for exporters in the period from April to July. This had a positive impact on the price competitiveness on the international market of agricultural and food products produced in Poland.

At that time, the import of food products amounted to EUR 12.8 billion and was 4.7% higher than last year. However, the growth rate of exports exceeded the growth rate of imports, and as a result, the positive balance of trade increased by 9.9% up to EUR 6.3 billion, as compared to the same period of 2019 - KOWR emphasized.

In the period of seven months of 2020, as in previous years, agri-food products were exported from Poland mainly to the EU market. Deliveries to EU countries generated EUR 15.2 billion (an increase by 3%), which constituted 79% revenues obtained from the export of agri-food products in total.

In the period of January-July 2020, agricultural and food products worth nearly EUR 4 billion were exported to non-EU countries, compared to EUR 3.3 billion a year ago (an increase by 20%).

Polish export hits are: meat, fruit, vegetables, cereal and dairy products, as well as sweets.

Source: farmer.pl

Inflation rate in August 2020

According to Central Statistical Office (CSO) data, the level of prices of consumer goods and services (inflation rate) in August 2020 was 2.9% higher than in the corresponding month of 2019, with the prices of services increasing by 6.6% and goods by 1.5%.

August was another month in a row in which a slowdown in the decline in fuel prices for private means of transport was recorded - compared to August 2019, they were lower by 12.3%, compared to a decrease in July by 16.1% and by 19.3% in June . This translated into a slowdown in the fall in transport prices, which amounted to 7.1% in August, compared with a decline of 8.5% in July and 11.4% in June.

Moreover, in August we recorded a further significant slowdown in the growth of food and non-alcoholic beverages prices - to 3% against 3.9% in July and 5.7% in June. The prices of energy carriers increased by 4.5%, ie slower than in July (5.1%), still a large influence in this category is the increase in electricity prices, which amounted to 11.7%. August also saw a decline in the prices of clothing and footwear by 1.9%.  In annual terms, a significant impact on the level of inflation had the increase in food prices.

Compared to July, August prices were 0.1% lower, with the prices of goods falling by 0.3% and the prices of services rising by 0.2%. The decrease in food prices by 1.2% and the decrease in the prices of clothing and footwear by 1.5% had the greatest impact on this result. In turn, fuel prices increased by 3.3%, and transport prices were 1.9% higher than in July. The prices of energy carriers increased by 0.1%.

In the opinion of the Ministry of Development, in September inflation will remain close to the current level, ie approx. 3% on an annual basis. The increase in food prices (by approx. 3.4%) and the growth rate of prices related to housing, health and education will continue. At the same time, we expect a limited drop in prices in transport (around 6.3).

Source: CSO, Ministry of Development

Hobbies during pandemic

The pandemic and related restrictions have affected many areas daily life. But there are also positive aspects to the current situation. According to a new study conducted by the National Debt Register, many people have decided to spend their excess time on developing their interests. The first place among the most popular passions was taken by sport and exercise, which 35% of Poles choose. In addition to physical activity, Poles are also more willing than before to cultivate plants and experiment in the kitchen - in the era of a pandemic, 33% of people deal with gardening, and 32% with cooking.

Having more free time at our disposal, we also spend more money on our hobbies. “Poles want to be active during a pandemic and are looking for new interests. This is also followed by higher spending on hobbies. Almost every fifth Pole (22%) declared that he spents more money on his passion or additional activity.

Despite the unstable economic situation, as many as 70% of the respondents declared that they do not intend to give up spending on developing their interests. Only 8% of people had to limit them - mainly due to the lack of funds and the desire to save.

Source: PAP Life

On-line Consumers

As a result of the coronavirus pandemic Poles have changed their shopping habits, in particular as regards the on-line shopping of food products, according to the latest survey conducted by consulting company KPMG.

Despite the spread of the coronavirus pandemic 66% of respondents didn't see a reason, or need to abandon going to shops, but 29% admitted that there were situations in which they bought food products by means of an Internet website. In case of non-food shopping 71% of consumers abandoned traditional shopping and turned to online shopping. 43% of respondents took advantage of mobile applications.
During the pandemic 19% of surveyed Poles declared that they are buying food products exclusively online. The main reason for choosing online sellers was the convenience associated with this sales channel (66% of responses).
Over a third of consumers started shopping online for products from categories that they didn't use to buy on the Internet earlier. Online shops gained on average 6% new clients who before the pandemic didn't use to buy such products online. Online shops offering food products gained the most new clients - their client base grew by 9%.

The survey conducted by KPMG shows that as a result of the coronavirus pandemic 44% of Poles have a more pessimistic view of their financial situation. The pandemic has made 70% of consumers cut their spending. Over a half of the surveyed declared that they want to stop all non-essential purchases.

Source: PNB Economic Review 2020