I expect Serbia to repeat the export of agrarians from the “pandemic year” of 4.2 billion dollars, and even higher. That is 50 percent more than in 2016. And proof that our country, within a thousand kilometers, is a serious player in the food sector. Next year will bring confirmation of that, because many countries did not have enough for themselves during the pandemic, says Branislav Nedimovic, Minister of Agriculture, Forestry and Water Management, in an interview for “Politika”.
– The price of food in the world will certainly have an upward and constant growth trend. It will reach its full price and will not be devalued as it was a decade ago. The goal is to achieve exports of at least seven billion dollars in the coming years. This implies intensification of the food industry because it valorizes a much higher value than exporting only wheat and corn.
Last week, the President of Serbia, Aleksandar Vucic, did not sign the amendments to the Law on Waters, which caused great public attention.
The president used his constitutional powers. An error occurred in our ministry. We are starting a public debate in the fall, and any proposal is welcome. After the adoption of the Law on Public Property, this matter is really unregulated. This proposal for amendments to the law was sent to the parliament two and a half years ago. And all those who announced themselves from the opposition had the opportunity to react both then and all this time. I have nothing against. We will enter the public debate and get, I hope, quality solutions for the regulation and lease of water land, but also other important issues, said Nedimovic.
How has the lease principle worked so far?
– It was an undeveloped area. 15, 20 years ago, anyone who occupied any point, contacted the competent water management company and concluded a contract. Without any procedure. I will not go into the current proposed solutions, let’s start from the beginning. The only question is how to treat those who have permanent use permits and how to get them to water management land. It turns out that they received a permit without having access to that land and that someone else will be able to rent it in front of their facility.
This season, raspberries are not the main topic in the media for the first time. But the producers of tomatoes and milk had problems…
The problem with tomatoes in the Jablanica district arose because the harvest was postponed for two to three weeks due to heavy rains. They lost that period when the price is the best. I am talking about exports, so this product was purchased in other markets from some other countries. At the beginning of July, we were always the most competitive when it comes to tomatoes. In the middle of July, that is no longer the case and the prices are decreasing, so the producers really had difficulties and could not make money.
What is proposed as a solution?
We have reached an agreement and we must solve this problem systematically. Four years ago, the field was electrified in that area and the fact is that we jumped from 60 greenhouses to almost 700. So the amount of goods is constantly increasing. Not only in Leskovac, but also in the area of Lebane, Vlasotince. They need agricultural infrastructure, to build roads so that as few goods as possible are of another class. Let’s continue with electrification and solve the problems with hail protection. Next year, we will introduce automatic anti-hail protection on the Kukavica mountain. We also have to master the way of packing goods, because in that sense we are no longer competitive in some markets.
Manufacturers also cite imports as a problem.
This year, we imported 3,500 tons less tomatoes than last year, so that can’t be a problem. As mentioned, the disturbance on the market cannot make 14 trucks of tomatoes from the Netherlands. That is not realistic. And it is also forgotten that from May 15 to September 15, we have customs protection for tomatoes.
When was it introduced?
– It’s been a few years. When someone wants to import tomatoes from the EU, the customs duty is 20%. From Turkey, the customs rate is 15 percent (up to 3,500 tons) or 30 percent for larger quantities. Realistically, the only country to which, due to the CEFTA agreement, we do not have customs protection is Albania. And Macedonia, but it is not our competitor at the moment. We cannot say that the quantities of Albanian tomatoes are so large that they can endanger our market. However, we also have something here that the manufacturers have recently pointed out to us. It is an attempt to re-export tomatoes from the EU, through some CEFTA countries, to our area. There is a real problem because customs is avoided and we have to seriously investigate and solve that.
How does Serbia defend levies? For the EU, we know, the problem is limiting the market. On the other hand, we see that they are huge all over the world, especially in the last year.
– We are not allowed any restrictions. And when we ask the EU, because we have an SAA agreement, because we want to use our rights that we have on the basis of that agreement, and they are related to the introduction of some protections, such as meat products, milk, we are always given countermeasures. If you do that – we will ban you from exporting fruits and vegetables to the European Union market. You get into a situation where the import of one product is worth 50 million euros, and the export of another 500 or 600 million, and then that is problematic.
We can always go back to 2009 and state that the SAA in the agricultural sector has been terribly negotiated. As for meat products, for example, we let complete liberalization for two or three years, and we didn’t have to. Unlike, say, Bosnia and Herzegovina, Macedonia, Montenegro, which still have customs protection and are not even close to the processing industry to be able to match us.
Is revision possible?
Yes, but with all countries at the same time. That is not realistic. You have one instrument, under the SAA, to introduce a measure when a market disturbance occurs. But Brussels does not look favorably on that at all. We have already tried twice for meat products because we are overwhelmed by these products from the EU. I don’t know why the one who negotiated agreed that after 2012 we don’t have any protection in that sector.
What happens to the price of milk?
The problem arose primarily due to the high price of corn and soybean meal. We are also talking to the dairies, because the purchase price has not changed for six years.
Estimates for maize yield are slightly reduced.
The price of corn is still holding up well, regardless of the fact that the harvest is approaching. I also think that the price will be better than ever, but also a good year for this cereal. It won’t be a record, like 2020, but it will be close to that.
This year, the price of fruit in the season is quite high. It is an unclear situation that the price of fruit increases up to three times from the moment it leaves the producer and reaches the market. Trade lobbies, buyers are to blame for that.
The Antimonopoly Commission proved monopolistic behavior on several occasions, in certain sectors, and the participants were punished. We haven’t had that in the last two or three years. But there is a mantra about import lobbies, delays in subsidies. Now, for the first time, we have adopted a law on regulating the market for agricultural products. Things are changing.
What are the estimates for fruit exports?
We are waiting for apples, they are one third of the total fruit growing in Serbia. It looked like we would even have a record in production this year. Realistically, due to the rains and then the drought, there will not be that amount. However, in terms of price and earnings, the results will be excellent. Some fruit species have a price they have never had before.
The formation of a joint venture with Russia was also mentioned recently. What is the essence?
The Russians want to create a hub in Serbia and be importers of Serbian goods. They also want investment in the meat industry sector, which is not disputable, as in the case of any foreign investor, if it meets all modern standards and opens a new market for us. They also said that there is a chance that small refrigerators will have the opportunity to export fruit to Russia.
I recently talked about that with the Russian Minister of Agriculture, to allow it for nuts from next season, because the limit in that segment was 500 tons. That was the exclusive request of the Russians, if they want to export to that market, they want to control larger refrigerators with a capacity of 500 tons. They have their own standards, but with the new electronic shipment tracking system, which will be fully operational from June next year, we will be able to go with smaller refrigerators as well.
Are you satisfied with the pace of withdrawal of money from the European pre-accession fund IPARD. Do you expect the effects of the introduction of an advance payment?
We have proposed changes to the law that will provide for an advance payment of 50 percent. The largest IPARD competition so far, worth 60 million euros, is underway. I am not satisfied with the part related to processing, there are less requirements. But there are many more of them for tractors and machines than there are funds. I think we’ve all been through that adjustment together and we’re going to have a lot of payouts this year. We will announce the last competitions, and then we have three years to realize them. We are already preparing for IPARD 3.
What kind of news is expected?
In financial terms, it will be more generous. Almost two times the previous amount. Local governments will also be able to compete for rural infrastructure, they will receive 100 percent of the money. This is a new dimension of financing.
The price of oil
The grain market has been extremely turbulent for the last year and a half. Oilmen had a perfect year in 2020, and consumers paid dearly for oil. Are there any estimates for next season?
The market is quite uncertain. Now the price of oil has fallen by 13 percent worldwide. However, the oil mills have already agreed on serious quantities of sunflower at the price of 40 ceents, and they will have to pay it.
Or our customers, after all?
We won’t, because the price has dropped. It will not tolerate the market and will go to their detriment, Politika reports.
