Hungary: Government's €77.1 million agri support scheme approved by EC

European Commission approves government’s €77.1 million agriculture support scheme

The news agency MTI reported on Tuesday that the European Commission has approved a support scheme in connection with the war in Ukraine for agriculture, fishing and food industry companies by the Hungarian government with a total budget of €77.1 million.

The Commission approved the support instrument under the State aid Temporary Crisis and Transition Framework. The measure covers subsidized loans up to €2.7 million per company, to be granted no later than December 31, 2023.

Portfolio.hu reports that the EC has examined the scheme and found that it was in line with the conditions of the framework. The conditions of the supported loans include that their maturity cannot exceed six years, interests have to match minimum interest rates, the support covers working capital needs, and that loans be disbursed before December 31, 2023 at the latest.

Last Monday EU Member States furthermore approved a €100 million support package for farmers in Bulgaria, Hungary, Poland, Romania and Slovakia, who suffered from the influx of Ukrainian grain, of which Hungary will be receiving almost €16 million.

Government introduces mandatory price monitoring

Minister for Economic Development Márton Nagy has recently announced that a new governmental regulation will introduce mandatory price reporting for companies in the retail sector, reports Portfolio.hu. The reporting obligation apply for 61 food product categories, in which retailers will have to send in the daily price, as well as the price for loyalty program customers.

The regulation will enter into force on July 1. The government commented that the measure will be introduced in order to foster market competition and protect consumers, who will be able to find the lowest daily price for any given item from the list in the price monitoring system.

Portfolio.hu notes that according to the government’s viewpoint, inflation in Hungary is not only due to macroeconomic tendencies but also to “profiteering in the retail sector”. According to the official figures of the Central Statistical Office (KSH), inflation in Hungary stayed over 20% throughout the spring, with 21.5% in May, with core inflation at 22.8%.

We reported last week that the price caps on certain food items will be lifted in the beginning of August. We also previously reported on experts’ opinions on how the price cap policy contributed to the increase of food prices and inflation.

Sour cherry yield will be lower due to cold weather

According to the National Chamber of Agriculture (NAK) and the FruitVeB fruit and vegetable growers’ alliance, sour cherry yields will be lower this season due to the cold weather, based on current estimations as the harvest started with early-ripening varieties in the past days.

Sour cherry farming in Hungary yields 60 thousand tons annually on average, and this year’s harvest will still fall close to the average, although temperature fluctuations and spring frosts during the flowering and fruit setting period led to losses in the crop. On the other hand, surviving fruit in this case grow larger, which will partially compensate for losses, bringing the yield decrease to around 15-20%.

Agrárszektor.hu reports that the the domestic consumption by the population is around 10-15 thousand tons annually, consumed both fresh and also used in canning. Hungarian varieties are also sought-after abroad, which is why 60-80% of the sour cherry produced in Hungary is exported, primarily to Germany. Most of the sour cherry grown in the country, both domestically and abroad, are taken up by the processing industries, including in canning and refrigeration, juice production, drying and pálinka production.

Hungarian garlic farming declining amidst abundance of imported produce

Vampires in Hungary might rejoice as garlic farming is declining in the country. The National Chamber of Agriculture (NAK) has provided the latest figures on garlic farming in the country to Agrárszektor.hu. According to NAK’s figures, while in 2021, 796 hectares of farmland were used for garlic cultivation, last year the figure had decreased to 778 ha, and this year it further declined, to 672 ha.

Agrárszektor.hu also reports that the increase in production costs and the increasingly extreme weather conditions are affecting producers, leading many of them to cultivate on smaller and smaller areas. Because domestic farming does not meet Hungary’s garlic demand, a substantial amount of garlic is imported, primarily from Spain, the Netherlands and Italy.

Average yield per hectare is 8-10 tons for garlic, making the total harvest around 7 thousand tons in the country. 81% of this is produced in one county, Csongrád-Csanád, which is located in the middle of the Hungarian Plain in South Hungary.

According to the Agrárszektor report, the average annual consumption is 1-2 kg per capita. In 2021, the country imported 2269 tons of garlic. Hungary still exports garlic however, between 400-680 tons, primarily to neighboring countries.

The article also states that based on the latest Eurostat data, the EU is a net exporter of garlic, with the aggregated EU export totaling 76.1 thousand tons and an import of 50.1 thousand tons. On the common market, Spain is the biggest exporter, followed by the Netherlands.

Suddenly, Giant Asian Mantises Appear

The Hungarian Natural History Museum’s blog has reported recently that an Asian species of large mantises has appeared in Hungary. The species, Hierodula tenuidentata, is larger and more robust compared to the European mantis (Mantis religiosa) which is indigenous in Hungary. How the new species will affect the environment is not yet certain.

The first specimen of the species was found in Hungary in 2019. The museum’s blog further adds that the giant Asian mantis species has established a stable population in the area of Szeged, in South Hungary, and is currently spreading, as in 2022, it appeared further away from Szeged, in Kiskunhalas. It has also been found in Budapest, which is probably due to anthropogenic migration, the most likely scenario is that cocoons attached to ornamental plants were unintentionally brought into the city as the sporadic sightings took place in newly built parks and freshly landscaped areas.

The blog article also adds that the impact of the giant Asian praying mantis species on the local wildlife is still uncertain. While the new mantis species primarily resides in the foliage of trees and shrubs, the native European praying mantis species predominantly inhabits the herbaceous vegetation of open areas. Their differing habitat preferences reduce the likelihood of direct competition between the two species. However, there is concern that pheromones released by the invasive species' females may attract males of the native praying mantis as well, thus diminishing their reproductive opportunities.