Hungary: Plum farming finally out of the pit?

Fruit growers have had a tough season in Hungary this year – Our report last Friday on the struggles of pear farmers was just the latest in a series of challenges that Hungary’s fruit sector is facing. 

And yet there is now hope that things might take a turn for the better for at least one of Hungary’s struggling fruit varieties. Farmers in the plum growing business are now expecting that this year, they might just finally be able to finish a good harvest and sell their produce at a reasonable price.

The issues with plum farming in Hungary are complex of course. Plum growing has been struggling in the whole of the EU for years. The latest sectoral report of the Institute of Agricultural Economics (AKI) states that, based on Eurostat data, the EU’s total plum farming area decreased from 220 thousand hectares in 2000 to 154 thousand ha by 2020. In 2020 alone, the EU produced 25% fewer plums than it had a year before.

Last year Hungary produced 27 thousand tons in its 7.06 thousand ha of plum orchards, which was the worst harvest in two decades. While the country normally exports between 1.4 and 7.6 thousand  tons of plums, primarily to Germany, the harvest in 2020 was so bad that Hungary’s net export in plums dipped into negative figures, and domestic traders actually had to import the fruit from abroad.

In the past fourteen weeks, both domestic and imported plums have been present in the wholesale fruit trade with a price of €1.09 per kilogrm, which is in line with prices from the same period in 2020. 

Farmers are optimistic though. They say that usually there is a lot of demand for plums at local markets, and consumer prices are reasonable there.

However, plums are not only consumer products, they are also sought-after as a commodity for the production of pálinka, Hungary’s famous and protected fruit-based spirit. 

As a value-added product, pálinka fares well on the domestic market and although its per liter prices increased by around €2 this year because of increased taxes on strong alcoholic beverages, Hungarian distilleries still produce around 210 million liters of pálinka with 50% alcohol content annually. As a thumb rule, the distillation of one liter of pálinka requires ten liters of fruit content, and plum is the most widespread choice for distillation because plum trees are prolific and have a relatively high yield per area compared to other fruits. 

Normally, a 0.5 liter bottle of Hungarian pálinka goes for a price between €14 and €83 but an exquisite vintage bottle can easily cost as much as €900.

Even though the price of this unique spirit increased, pálinka producers had a good season last year. 2020 was a year that we will probably not forget anytime soon. And aside from skyrocketing sales in Netflix subscriptions, home food delivery services and of course, the sleeper hit of the century, toilet paper - Hungary’s pálinka sales also went up by 5%.

You can find out more about Hungary's fruit and vegetable production in our in-depth analysis of Hungarian horticulture.

***

Before you go - Have you seen these?

We at the Budapest-Belgrade LAN team publish newsflashes for you every Friday afternoon. These are quick, digestible, to-the-point briefings about all the latest developments in the Serbian and Hungarian agro sectors.

Here are our newsflashes from last Friday:

In the latest Serbia Newsflash, you can read about the issue of annual climate losses, a new foreign investment into the country’s confectionary industry, international trade streamlining, the transformation of the bakery industry, subsidies for rural living, and the €9 billion Green Deal funds for Serbia.

In this week’s Hungary Newsflash, you can find out more about a new breakthrough in climate change research, the issues with rising crop cultivation input costs, the continuing struggles of the pig sector, and the coming investment surge in the agro business scene.