#48 Serbia Agriculture Bulletin, BFC

09/2019

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48 S e r b i a Agriculture Bulletin Serbia has goal of modern, Western-style cooperative National Institute for Viticulture and Enology to be created Products with geographic origins being promoted

Wheat prices down

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Agriculture Finance Bulletin Edition #48, September 2019

Contents State Initiatives ........................................................................................................... 2 1) 2) 3)

Loan subsidy applications accepted until November 1 ................................................................... 2 Serbia has goal of modern, Western-style cooperative .................................................................. 2 National Institute for Viticulture and Enology to be created .......................................................... 2

Foreign Aid ................................................................................................................. 2 4) 5) 6) 7) 8)

5th public IPARD call announced..................................................................................................... 2 Products with geographic origins being promoted ......................................................................... 3 6th IPARD call expected................................................................................................................... 3 Ministry of Agriculture, FAO sign agreement to promote agricultural production ........................ 3 Two-day agribusiness conference organized in Belgrade ............................................................... 3

Private Sector.............................................................................................................. 4 9) 10) 11) 12) 13) 14) 15) 16) 17)

Meat producers hit hard by Russian ban ........................................................................................ 4 Organic production on the rise in Serbia ......................................................................................... 4 Serbian wheat and flour quality needs to improve ......................................................................... 4 Survey highlights main weaknesses in Serbia’s agricultural sector................................................. 4 Wheat prices down.......................................................................................................................... 5 No new cases of swine flu have been found in Serbia .................................................................... 5 Serbia is a leading vegetable exporter in this part of Europe ......................................................... 5 Econaut launches organic waste project ......................................................................................... 5 Value of agricultural sales at RSD 75.7 billion this year .................................................................. 6

Note: The Agriculture Finance Bulletin presents a monthly roundup of headlines and news stories related to investments and financing flows to Kyrgyzstan’s agricultural sector.

This bulletin is prepared by Business & Finance Consulting—a Swiss-based development finance consulting company with a long history of working in Kyrgyzstan. Currently, BFC is implementing the Agricultural Lending Programme for KfW. Read more »

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BFC. Agriculture Finance Bulletin.

State Initiatives 1)

Loan subsidy applications accepted until November 1

September 23rd, 2019, http://www.agronews.rs/rok-za-podnosenje-zahteva-za-kreditnu-podrsku-1-novembar/

The Ministry of Agriculture, in cooperation with commercial banks, is continuing the implementation of subsidized loans for farmers this year through November 1. In total, RSD 600 million is available under the program for registered family households, entrepreneurs and legal entities (micro-, small- and medium-sized enterprises) as well as for agricultural cooperatives. The subsidy incentives are intended to help farmers engaged in animal husbandry, fruit growing, viticulture, arable farming, vegetable growing and floriculture. Loans can be taken for investments in agricultural machinery and the procurement of animal feed at a rate, for end beneficiaries, of just 3% per annum and for a period of 1–3 years.

2)

Serbia has goal of modern, Western-style cooperative

September 20th, 2019, https://beta.rs/ekonomija/ekonomija-srbija/116877-krkobabic-cilj-nam

Minister for Regional Development Milan Krkobabic has stated his support for developing modern Western-style cooperatives in the country. In fact, the Minister hopes that, in the future, every major village will have one. The state has also been proactive toward this end, allocating RSD 1.7 billion for investments in cooperatives this year. Minister Krkobabic hopes that cooperatives will eventually help connect villages with export opportunities, thereby increasing the socio-economic conditions in rural areas. The Minister also hopes to further develop villages by ensuring that each is equipped with adequate school facilities, water supplies, infrastructure and cultural houses.

3)

National Institute for Viticulture and Enology to be created

September 13th, 2019, http://www.agronews.rs/srbija-dobija-novi-nacionalni-institut-za-vinogradarstvo-i-vinarstvo/

It was announced that a new institute will be created in Sremski Karlovci to help unite winemakers from around Serbia and the region at large. The main aim of the institute will be in the field of education, helping to increase theoretical and practical knowledge about viticulture. The institute will also be equipped with state-of-the-art equipment that will be available to all wine producers.

There are currently 26,000 hectares of vineyards in Serbia, and the area is increasing every year.

Foreign Aid 4)

5th public IPARD call announced

September 26th, 2019, http://www.agronews.rs/raspisan-peti-javni-poziv-za-ipard-podsticaje/

A 5th public IPARD call has been announced. This call is for investments in the physical property of agricultural farms, including for the purchase of new machinery and equipment as well as for the construction of new facilities. New tractor purchases are not included under this call.

This call’s incentives will cover 60–70% of eligible investment costs, with a minimum of EUR 5,000 and a maximum of EUR 1 million. Detailed information on the call, including terms and conditions, can be found on the website of the Agrarian Payments Administration.

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5)

Products with geographic origins being promoted

September 17th, 2019, https://beta.rs/ekonomija/ekonomija-srbija/116728-vise-od-60

The United Nations Food and Agriculture Organization FAO, the European Bank for Reconstruction and Development (EBRD), the Ministry of Agriculture, the Aryl Raspberry Association and the Sour Cherry Association are working together to promote Serbian products with a protected geographical origin in European Union (EU) and other foreign markets. Food production is a sector with one of the largest export potentials for Serbia, and increasing production recognition will help to add value to Serbian products and put them in better positions in foreign markets. So far, more than 60 Serbian products have been registered with a protected geographical origin.

6)

6th IPARD call expected

September 16th, 2019, http://subvencije.rs/vesti/otvara-se-ipard-konkurs-vredan-47-milijarde-dinara/

A 6th public IPARD call is expected to be announced shortly. Specifically, the call is expected to be for investments in the physical assets of agricultural holdings, especially those of farms, storage facilities, orchards and greenhouses. The call is also expected to cover the procurement of tractors and other agricultural machinery.

Funding will be awarded in amounts ranging from EUR 10,000 to EUR 1 million. Applicants who have previously applied for IPARD funds (including those who had previously been rejected) will be eligible to apply for this call.

7)

Ministry of Agriculture, FAO sign agreement to promote agricultural production

September 12th, 2019, http://www.minpolj.gov.rs/saradnja-ministarstva-i-fao

Minister of Agriculture Branislav Nedimovic and Food and Agriculture Organization of the United Nations (FAO) representative Vladimir Rakhmanin have signed an agreement for a 2019–2022 USD 1 million program that will work on: (1) developing the sustainable agricultural production of small, family farms as a way to improve the standard of living in rural areas, (2) strengthening resilience to natural disasters and climate change by improving the sustainable management of natural resources and (3) increasing the competitiveness of the agriculture and food production sectors by modernizing market chains.

8)

Two-day agribusiness conference organized in Belgrade

September 11th, 2019, http://www.tanjug.rs/full-view_en.aspx?izb=506214

The European Bank for Reconstruction and Development (EBRD) has organized the Consumer Rules Summit in Belgrade this autumn. The event was organized to address the latest global developments in agribusiness, retail and distribution. It will bring together 30 top speakers and over 100 participants from leading companies from the European Union (EU), Southeast Europe, the Commonwealth of Independent States (CIS), the Middle East and Africa. The goal of the event is to connect entrepreneurs with international investors, retailers, food producers, regulatory authorities and other relevant stakeholders, with the ultimate goal of promoting investments in these highly dynamic sectors.

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BFC. Agriculture Finance Bulletin.

Private Sector 9)

Meat producers hit hard by Russian ban

September 26th, 2019, https://www.b92.net/biz/vesti/srbija.php?yyyy=2019&mm=09&dd=26&nav_id=1596017

When Russia introduced a ban on Serbian meat and meat products late May/early June, it was expected that the issue would be resolved quickly; however, the ban is still in place and hitting producers hard, with many recording losses. The ban was implemented by Russia’s Federal Veterinary and Sanitary Surveillance Service due to non-compliance with Russian regulatory and technical procedures. The situation was further aggravated by cases on swine flu appearing in Serbia.

10) Organic production on the rise in Serbia September 25th, 2019, http://rs.n1info.com/Biznis/a528908/Organska-proizvodnja-u-Srbiji

Organic production in Serbia has increased more than eight times in the last ten years. In fact, more than 6,000 Serbian producers were engaged in organic production on 19,200 hectares in 2018. This led to the value of organic exports reaching EUR 27.5 million in 2018, an increase of more than six times over the last seven years.

Organic production has great potential in Serbia, especially in countries with a growing organic market such as Sweden. To this end, the government is planning a number of measures to support organic production in the coming year, including increasing production subsidies for the sector.

11) Serbian wheat and flour quality needs to improve September 24th, 2019, http://www.politika.rs/scc/clanak/438478/Kako-da-Srbija-poboljsa-kvalitet-psenice

Serbian wheat and flour exporters will need to tighten quality controls to ensure that toxin content does not exceed permitted limits as importers in other countries are expected to increase their scrutiny of toxin content. They also need to work to improve quality in general. Serbia also has 180 different registered varieties of wheat, something the confuses importers. To resolve this and ensure that wheat and flour quality remains high, Serbian wheat producers should consider obtaining high-quality seeds. Not only will this help maintain a certain level of quality, it will also help ensure that wheat production remains consistent, even in the face of climate change and other environmental challenges.

12) Survey highlights main weaknesses in Serbia’s agricultural sector September 21st, 2019, http://www.politika.rs/scc/clanak/438277/Starost-ljudi-i-traktora-slabe-tacke-srpske-poljoprivrede

A recent survey of agricultural holdings indicates that the main weaknesses of Serbia’s agricultural sector are the age of people engaged in agriculture and the prevalence of older agricultural machinery. The survey also indicated that the average size of individual farms is increasing. Plant production was found to be more common in Vojvodina, while livestock production was stronger in Sumadija and Western Serbia.

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The survey was created by the European Union (EU) and covered a total of 120,000 households, including approximately 1,500 single and family farms registered as legal entities.

13) Wheat prices down September 17th, 2019, http://www.stips.minpolj.gov.rs/srl/vest/slaba-traznja-za-psenicom

Wheat prices in Serbia have fallen in recent weeks due to poor exports, which has resulted in an increase in supply in the country. Moreover, wheat producers’ demand is also lower. Prices have fallen to about RSD 17.20 per kilogram, which is about RSD 6 less than in June. Typically, wheat prices rise this time of year.

14) No new cases of swine flu have been found in Serbia September 16th, 2019, http://www.politika.rs/scc/clanak/437930/Nema-novih-slucajeva-africke-kuge-kod-svinja

Serbia’s Veterinarian Health Directorate has announced that there have been no new cases of swine flu in the country and that a monitoring plan has been put in effect to detect the disease and prevent further outbreaks.

Earlier, cases of swine flu were found in Velika Krsna, Rabrovac, Kusadak and near Zitiste. Swine flu is a viral, very dangerous contagious disease for which no vaccine currently exists.

15) Serbia is a leading vegetable exporter in this part of Europe September 10th, 2019, http://www.agronews.rs/srbija-vodeci-izvoznik-povrca-u-ovom-delu-evrope/

Serbia has reached an annual vegetable production level of 1.75 million tons, making it the largest vegetable exporter in the region. In order to improve on this, it will be important for Serbia producers to continue to change and take advantage of new technological and scientific advancements, especially as agro-environmental conditions change and, potentially, may become less favorable over time. For example, this year was not particularly favorable for Serbian farmers; however, they were still able to boast good production levels due to the quality of their yields. Producers will also need to make sure to adapt to changing market demands, especially as the world places a greater emphasis on healthy living.

16) Econaut launches organic waste project September 6th, 2019, http://www.agronews.rs/startuje-projekat-zelena-mreza-odrzivih-rasadnika-srbije/

The environmental organization Econaut has launched the Green Network of Sustainable Nurseries in Serbia pilot project. The project aims to contribute to the improvement of technology related to the production, protection, transport, consumption and treatment of organic waste. The project will work to educate (through their “Green Network” web portal) and increase efforts to boost the popularity and opportunities available within a circular economy, something that makes production chains both environmentally and economically viable.

The project, which was initiated in partnership with the Association for Plant Production and Processing of Plant Products of the Serbian Chamber of Commerce, is being funded through a regular annual program of the Ministry of Environmental Protection of Serbia.

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17) Value of agricultural sales at RSD 75.7 billion this year September 4th, 2019, http://www.agronews.rs/vrednost-prodaje-proizvoda-poljoprivrede-757-milijardi-dinara/

The total value of the sale of agricultural, forestry and fishery products in Serbia in the first half of 2019 was RSD 75.7 billion, approximately the same as in 2018. The Vojvodina region had the largest share (RSD 48.8 billion) in the total value of sales of agricultural, forestry and fishery products in the first half of the year, and the Belgrade region had the smallest share (RSD 5.4 billion).

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