Serbia: Farmers sign agreement with government

Farmers sign agreement with the government on fulfillment of their demands

Representatives of seven agricultural associations that have been protesting for months and intensified  their protest in May by blocking traffic with tractors, signed an agreement with Agriculture Minister Jelena Tanaskovic on the fulfillment of demands on May 22.

The agreement on ending the protests and removing the blockades was reached the weekend preceding the signing of agreement. In addition to the Minister of Agriculture, Serbian Prime Minister Ana Brnabic, and Finance Minister Sinisa Mali also attended the negotiations. By agreement, the Ministry of Agriculture undertook to increase the basic incentives for plant production (per hectare) from €77 to €154 in 2023 and to raise the maximum area of arable agricultural land for which subsidies are paid from 20 hectares to 100 hectares from January 1, 2024.

The premium for milk was increased from 0.12 to €0.16 per liter and incentives for quality breeding dairy cows from €256 to €341 per head. The 50% of the drainage fee has been abolished for the current year, and this fee will be completely abolished from the next. Also, a levy for semi-hard cheeses of €Íű2.5 per kg has been imposed.

The Ministry undertook to carry out an analysis of the control of the import of milk and dairy products and to intensively continue communication with milk producers. It was stipulated that the market would be regulated by introducing quotas for producers, processors and importers of milk and that a solution would be found for the purchase of milk for producers whose purchase has been canceled. The agreement furthermore outlines the introduction of the so called blue diesel, i.e. relief in the amount of excise duty on 100 liters of diesel fuel per hectare. Finally, those protest participants who were fined by the police will not be punished for misdemeanors, the agreement stipulates.

Two associations of Serbian farmers - the Independent Association of Farmers and the Assembly of Agricultural Producers, which did not participate in the protests, are not satisfied with the government's promises and are seeking a meeting with officials. The President of the Independent Association of Farmers of Serbia, Mr. Jovica Jaksic, said that they are asking the government for help exporting surplus wheat and corn that were not sold last year due to the export ban. He said that a big problem is the price of wheat dictated by the exporters, which is about €0.15 per kg, or about $180 per ton, while in Ukraine it is $ 20 per ton, and in the Romanian port of Constanta it is $258. “If wheat remains at around 0.15 EUR per kg, it will not be profitable even to start the harvester,” said Jaksic.

The representative of the Independent Association of Farmers for the Belgrade region, Mihailo Milanovic, told Beta agency that they advocate “longer-term solutions, not day-to-day promises.” He added that the government, by fulfilling the demands of ten associations, “only calmed down the war, but it is still smoldering.” Milanovic said that his association is asking for subsidies per hectare to be increased up to an area of 100 hectares and that these subsidies should also apply to leased state-owned land. They are also looking for loans at subsidized interest rates because this year they took loans from banks at commercial interest rates, i.e. 10%-12%. He said that their request is to form a Chamber of Farmers at the Serbian Chamber of Commerce.

The President of the Assembly of Agricultural Producers of Serbia, Zoran Milicevic, said that all stockbreeders are not in an equal position because cattle producers, after the protest, received higher subsidies, and fattening cattle have been paid €8.5 per head for years.

Milk import larger than export by four thousand tons

From January to the end of March of this year, the most milk was imported to Serbia from the countries of the European Union, and the total import exceeded exports by 4.000 tons, reported magazine “Nova Ekonomija”. Most milk, according to the data of the Statistical Office of Serbia (RZS), was imported from Poland, Bosnia & Herzegovina, France, Denmark and Croatia. A total of 2.992 tons of milk worth €4.428 million were imported from Poland. From the beginning of the year to the end of March, 2.713 tons of milk worth €2.23 million were imported from Bosnia & Herzegovina. From the rest of the countries, Serbia imported the most milk since the beginning of the year from France (€2.28 million - 692 tons), Denmark (€1.84 million - 394 tons), Croatia (€1.19 million - 983 tons), Hungary (€870.000– 1.288 tons).

In the same period, 731 tons were imported from Slovenia for €650.000, from Sweden 138 tons for €501.000, from the Netherlands 131 tons for €423.000, from Belgium 102 tons for €320.000, from Germany 121 tons for €307.000, from the Czech Republic 168 tons for €175.000, and from Slovakia 190 tons for €114.000. In smaller quantities, Italy, Estonia, Latvia and Greece are also on that list. Serbia exports milk mostly to North Macedonia (€1.74 million– 3.051 tons), Montenegro (€1.16 million– 1.210 tons), Albania (€758.000– 1.376 tons), Croatia (€261.000 - 359 tons) and Bosnia & Herzegovina (€75.000– 60 tons). A few months ago, the government imposed levies (import taxes) on the import of milk from the EU, but this did not have a big  effect, and local stock-breeders stressed that these measures must also include the import of milk from countries that are members of the CEFTA agreement (Albania, BiH, North Macedonia, Moldova, Montenegro).

€17 million loan to cold storage owners to pay off last year’s raspberries

At the last week’s meeting with Prime Minister Ana Brnabic, representatives of the Association of Cold Storage Owners and Raspberry Producers, “Our Fruit Serbia”, agreed on the conditions for a loan of €17 million that will be used to pay off last year's raspberry crop, reported magazine “Nova Ekonomija”. According to the agreement reached, the cold storage owners with raspberries in stock will get from the government a loan of around €17 million, which they will necessarily direct to the producers' payment. The loan is based on the model of a guarantee scheme with interest subsidized by the Ministry of Agriculture and with a grace period. It was agreed that the loans will be placed through the state owned “Postanska Stedionica Bank”.

“It is an obligation to make an agreement between the small cold storages owners and the producers on the model of the final payment because all the burden due to disruptions in the market fell on the owners of the small cold storages. We are trying to pay off the raspberries that we have in stock,” said the representative of the “Our Fruit Serbia” association, Mr. Bozo Jokovic. He added that the option agreed upon in cooperation with the government is a “salvation from the current bad situation in the raspberry industry,” and that the very difficult harvest season is coming soon. The price of raspberries last year was a record, from €4.2 to €5.1 per kg, but later its sale abroad stopped, so many producers remained unpaid.