03/2021
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66 S e r b i a Agriculture Bulletin RSD 550 Million for Farmer Advisory Services RSD 1.25 Billion Paid Out in Agricultural Insurance Subsidies Free Online IPARD Trainings Held in March Increased Interest in Corn, Sunflower and Soybean Production
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Agriculture Finance Bulletin Edition #66, March 2021
Contents State Initiatives ........................................................................................................... 2 1) 2) 3) 4) 5) 6) 7) 8) 9)
Agriculture Minister Announces New Subsidies for Farmers.......................................................... 2 RSD 550 Million for Farmer Advisory Services ................................................................................ 2 State Competition to Allocate Empty Houses in Villages to Farmers.............................................. 2 New Program to Help Cooperative Development........................................................................... 2 Concerns About African Swine Flu on the Rise ............................................................................... 2 RSD 1.25 Billion Paid Out in Agricultural Insurance Subsidies......................................................... 3 Serbia to Implement Faster Organic Certification Processing ......................................................... 3 Ministry of Agriculture to Allocate RSD 25,000 per Hectare for Organic Production ..................... 3 Minister of Agriculture Justifies Reduced Diesel Subsidies for Farmers ......................................... 3
Foreign Aid ................................................................................................................. 3 10) 11) 12) 13)
Free Online IPARD Trainings Held in March .................................................................................... 3 Ministry of Agriculture Allocates USD 37.5 Billion in Investment Incentives .................................. 4 Serbia Prepares a Program for IPARD 3 Funds ................................................................................ 4 New Cold Storage Facility in Topola Highlight IPARD Success ........................................................ 4
Private Sector.............................................................................................................. 4 14) 15) 16) 17) 18) 19) 20) 21) 22) 23)
Increased Interest in Corn, Sunflower and Soybean Production .................................................... 4 AgroSens Platform Nominated as World’s Best E-Agriculture App ................................................ 5 Agricultural Producer Prices Up 7.4% .............................................................................................. 5 Agriculture: Serbia’s Economic “Golden Boy” in 2020 .................................................................... 5 Livestock Sector Potential Great, Reality Harsh .............................................................................. 5 Organic Production a Real Solution for Small Farms ....................................................................... 5 State Young Farmer Programs Growing in Use ............................................................................... 6 Increased EU Market Opportunities for Serbian Producers ............................................................ 6 Agro Belgrade 2021 Conference Held at Belgrade Fairgrounds ..................................................... 6 Serbian Agricultural Sector Achieving Strong Results ..................................................................... 6
Note: The Agriculture Bulletin presents a monthly roundup of headlines and news stories related to Serbia’s agricultural sector. This bulletin is prepared by Business & Finance Consulting—a Swiss-based development finance consulting company. Currently, BFC is implementing “Development of Financial System in Rural Areas in Serbia” programme for KfW. Read more »
BFC Max-Högger-Strasse 6 CH-8048 Zurich, Switzerland
Phone: +41 44 784 22 22 Fax: +41 44 784 23 23
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BFC. Agriculture Finance Bulletin.
State Initiatives 1)
Agriculture Minister Announces New Subsidies for Farmers
March 20th, 2021, http://www.rtv.rs/sr_ci/ekonomija/nedimovic-predstavio-novu-liniju-subvencija_1220307.html
Agriculture Minister Branislav Nedimovic has announced a new line of subsidies that will made available to assist farmers. This includes a program to help farmers purchase updated tractors (with 50% cofinancing from the state, 10% down and 40% in preferential credit) as well as subsidies aimed at boosting livestock and fruit production.
2)
RSD 550 Million for Farmer Advisory Services
March 20th, 2021, http://www.rtv.rs/sr_ci/vojvodina/novi-sad/kljucan-transfer-znanja_1220334.html
The Ministry of Agriculture has allocated RSD 550 million for the improvement of advisory services aimed at transferring knowledge of new production technologies and techniques to Serbian farmers, especially those that are sustainable, increase global competitiveness and help develop rural areas. Farmers have expressed an appreciation for the advisory services offered to them so far, reporting increased yields and greater profits. Going forward, the Ministry hopes to update legislation related to such services in order to further bolster their offering and harmonize advisory efforts with European standards.
3)
State Competition to Allocate Empty Houses in Villages to Farmers
March 19th, 2021, https://www.danas.rs/ekonomija/krkobabic-uskoro-konkurs
The Minister for Rural Welfare, Milan Krkobabic, has announced a competition under a state program aiming to allocate houses with a garden in Serbian villages to farmers. In total, the program will allocate 500 such houses to mostly young farmers in an effort to encourage youth in agriculture as well as revitalize rural areas and improve living standards in villages. It is estimated that approximately 150,000 empty houses exist in the villages of Serbia.
4)
New Program to Help Cooperative Development
March 17th, 2021, https://agrosmart.net/2021/03/17/uskoro-novi-program-za-pomoc-zadrugama/
The Ministry of Village Care has announced a new program to help cooperatives. The RSD 500 million program is aimed at boosting the capacities of cooperatives engaged in rural tourism and agricultural activities. Funding will be distributed based on the awarding of grants for business improvement and technological development concepts. Newly-formed cooperatives are eligible for up to RSD 7.5 million, while existing cooperatives are eligible for up to RSD 15 million.
5)
Concerns About African Swine Flu on the Rise
March 12th, 2021, https://www.danas.rs/ekonomija/bulatovic-ssp
While the last recorded case of African Swine Flu was recorded in the village of Mozgovo on February 17, 2021 and the state is claiming that the situation is well under control, many are concerned that the state’s efforts are not sufficient and that, in reality, there are new cases occurring in other villages around the country. Moreover, skeptics claim that there are no ongoing preventative measures being implemented on the ground to prevent further contamination. They warn that, if the state does not act soon, pig breeding in Serbia could complete decimated.
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6)
RSD 1.25 Billion Paid Out in Agricultural Insurance Subsidies
March 11th, 2021, https://www.novosti.rs/vesti/ekonomija/973503/ministarstvo-poljopvirede-1-2-milijarde-dinara-osiguranje
Last year, the Ministry of Agriculture paid out 28,100 requests for insurance incentives. This amounted to RSD 1.25 billion. According to the Law on Incentives in Agriculture and Rural Development, the state will cover 40% of the cost of insurance premiums (and 70% for farmers in the Kolubara, Moravica, Podunavlje, Sumadija and Zlatibor districts). For the upcoming agricultural season, the same rules as last year will apply, with incentives available for field, vegetable, fruit, vine, and hops production as well as for nursery and young perennial development. Incentives for animal insurance are also available.
7)
Serbia to Implement Faster Organic Certification Processing
March 10th, 2021, https://www.novosti.rs/vesti/ekonomija/973473/
The state will speed up the process to certify organic production in order to encourage the further development of organic agriculture in the country. Specifically, certification processes will be performed by a single platform instead of by subcontractors. It should be noted that organic exports have increased significantly in the last three years, making organic production an important segment for growing Serbia’s agricultural sector as well as its overall economy.
8)
Ministry of Agriculture to Allocate RSD 25,000 per Hectare for Organic Production
March 8th, 2021, https://www.novosti.rs/vesti/ekonomija/972478/raste
The Ministry of Agriculture is allocating funding for organic food producers in the amount of RSD 25,000 per hectare (up to RSD 1,000,000 in total). The decision to continue direct financial support comes after organic exports increased 30% in 2020. Funding will be made available to help organic producers attain certification and harmonize production processes with international requirements.
9)
Minister of Agriculture Justifies Reduced Diesel Subsidies for Farmers
March 5th, 2021, https://rs.n1info.com/biznis/smanjene-subvencije-poljoprivrednicima-ministar-se-pravda-jeftinijim-dizelom/
Speaking to critics of a recent government decision to reduce diesel subsidies per hectare from RSD 5,200 to RSD 4,000, Agriculture Minister Branislav Nedimovic noted that reducing dependence on the state is important for the long-term planning and development of the agricultural sector. Moreover, the Minister pledged to keep a close eye on diesel prices and intervene if prices rise.
Foreign Aid 10) Free Online IPARD Trainings Held in March March 28th, 2021, http://www.agronews.rs/besplatne-onlajn-obuke-o-ipard-u-biznis-planu-i-kreditima/
The Smart IPARD consulting agency organized a series of free online trainings on the IPARD program in late March 2020. The trainings, which are part of the KfW-funded SRFP program being implemented by Swiss consulting agency Business & Finance Consulting (BFC), included a general information session on accessing IPARD funding (including a question-and-answer period) and a session on how to negotiate with financial institutions and prepare a loan application (including creating a good business plan).
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The goal of the SRFP program is to increase income in rural areas of Serbia by providing access to soft loans and by strengthening the capacity of MSMEs operating throughout the country.
11) Ministry of Agriculture Allocates USD 37.5 Billion in Investment Incentives March 8th, 2021, https://agrosmart.net/2021/03/08/za-podsticaje-u-poljoprivredi-375-milijardi-dinara/
The Ministry of Agriculture is allocating RSD 37.503 billion for incentives this year and, in cooperation with the World Bank, will implement a program to enable farmers to procure fixed assets using some of these funds. Under the program, 50% of the investment cost will be covered from program funds, 40% will be covered in the form of a loan from a commercial bank and 10% will be required from farmers as a down payment.
12) Serbia Prepares a Program for IPARD 3 Funds March 3rd, 2021, https://www.ekapija.com/en/financing/3188920/serbia-first-in-the-region
Serbia is the first country in the region to prepare a program for accessing the European Union (EU)’s new IPARD 3 funds. The funds are intended to help in the construction of roads, sewer systems and other rural infrastructure aimed at supporting agricultural production. Funds will also be used to support the work and quality of life of Serbian farmers. In total, an estimated EUR 225 million in subsidies are planned for IPARD programs for 2021. This will support an estimated 150 projects across Serbia.
13) New Cold Storage Facility in Topola Highlight IPARD Success March 1st, 2021, http://uap.gov.rs/primeri-dobrih-ipard-projekata-u-topoli-otvorena-nova-hladnjaca/
Agriculture Minister Branislav Nedimovic recently visited Topola to view the results of an IPARD-funded cold storage facility. The facility contains a modern 4,000-square meter cooler that has the capacity to refrigerate 2,500 tons of apples and other fruits. A total of RSD 215 million was invested in the cooler. So far, it has given a return of RSD 107 million. Minister Nedimovic stated that the facility is a good example of how IPARD funds can be used successfully to launch new and important initiatives in the agricultural sector. The Minister also added that EUR 225 million are in IPARD funding for Serbian farmers and that 150 project using IPARD funds have already been completed.
Private Sector 14) Increased Interest in Corn, Sunflower and Soybean Production March 24th, 2021, https://www.danas.rs/ekonomija/rast-cena-kukuruza-suncokreta
There has been an increased interest on the part of farmers in the sowing of corn, sunflowers and soybeans. This is due to an increased demand worldwide for corn (especially from China), the stable yield and demand for sunflower products and the growing price of soybeans in various markets. Sowing of these crops is expected to begin shortly, once soil moisture levels allow machines to enter fields and the soil temperature rises about 10 degrees.
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15) AgroSens Platform Nominated as World’s Best E-Agriculture App March 23rd, 2021, https://agrosmart.net/2021/03/23/platforma-agrosens
The Food and Agriculture Organization of the United Nations (FAO) has nominated the digital platform AgroSens of the Novi Sad Institute Biosens for the Best E-Agriculture App award of the World Summit for the Information Society. AgroSens is a simple digital tool that allows farmers to monitor crop status and plan activities using mobile phones or computers based on data collected from satellites, drones, various sensors and meteorological stations. As more and more activities are being carried out remotely due to the COVID-19 virus pandemic, the AgroSens platform has become especially important and is constantly being improved to best meet the needs of users.
16) Agricultural Producer Prices Up 7.4% March 23rd, 2021, https://agrosmart.net/2021/03/23/cene-poljoprivrednih-proizvoda-za-godinu-dana-porasle-74-odsto/
Producer prices of agricultural and fishery products in January 2021 were up 7.4% year-on-year and 4.7% compared to December 2020. The main price increases were seen in industrial plant production (up 25.4% year-on-year and 10.1% from December 2020) and cereal production (up 23.9% year-on-year and 11.8% from December 2020).
17) Agriculture: Serbia’s Economic “Golden Boy” in 2020 March 22nd, 2021, http://www.tanjug.rs/full-view_en.aspx?izb=640063
Agriculture Minister Branislav Nedimovic referred to Serbia’s agricultural sector as the “golden boy” of the country’s economy in 2020. He noted that agriculture helped the country maintain its overall GDP in the face of the current pandemic. Moreover, agricultural exports have been particularly strong in the last two years, rising 50% to USD 4.2 billion.
18) Livestock Sector Potential Great, Reality Harsh March 22nd, 2021, http://www.agronews.rs/stocarstvo-izmedu-izvoznih-potencijala-i-surove-stvarnosti/
Despite the favorable natural conditions, Serbian livestock is in a great crisis. The number of cattle has been declining at an annual rate of 2-3% over the past decade, and meat production has declined from 650,000 tons (in the 1990s) to about 517,000 tons as a result. Analysts point out that, without a long-term defined livestock development program that includes plans for funding and investments, the process of reviving livestock production will be impossible. The past points to signed of encouragement in terms of potential, however. For example, Serbia exported 30,000 tons of veal per year more than three decades ago and estimated that this could reach as much as 50,000 tons per year. This is in sharp contrast to recent annual exports of beef of 315 tons in 2015 and 400 tons in 2020. Serbia’s livestock sector has potential, but it also needs support to develop and reach its former level of production.
19) Organic Production a Real Solution for Small Farms March 8th, 2021, http://www.tanjug.rs/full-view_en.aspx?izb=636428
Agriculture Minister Branislav Nedimovic has stated that organic production represents a real solution for the survival of small farms, especially those in Western and Southern Serbia. This is evidenced by organic agricultural exports increasing from USD 3.4 million in 2010 to UDS 37 million. To this end, the government is ready to provide assistance to small farmers looking to transition from conventional to organic agricultural production.
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20) State Young Farmer Programs Growing in Use March 8th, 2021, http://www.tanjug.rs/full-view_en.aspx?izb=636362
Prime Minister Ana Brnabic and Agriculture Minister Branislav Nedimovic made a visit to a Stojnik (central Serbia) farm that recently received government incentives aimed at encouraging young farmers. During the visit, both officials stated their encouragement regarding the growing response to such incentive programs and noted the importance of investing in youth engagement in all industries, including agriculture. So far, state program incentives have provided a total of EUR 25 million in financial assistance to more than 3,000 young farmers.
21) Increased EU Market Opportunities for Serbian Producers March 8th, 2021, http://www.agronews.rs/prilika-za-srpsku-malinu-i-borovnicu-na-evropskom-trzistu/
Serbian berry products have been in increasing demand in European Union (EU) markets. This is important as agglomeration companies look to conclude contracts with EU importers for various fresh and frozen products. Such contracts have already provided improved market access to 420 subcontractor producers, most of whom live and work in less developed parts of Serbia. Assuming demand continues to grow, more producers from other less developed areas will be able to enjoy the benefits of trade with the EU.
22) Agro Belgrade 2021 Conference Held at Belgrade Fairgrounds March 5th, 2021, http://www.rtv.rs/sr_ci/drustvo/ulaganja-u-poljoprivredu-obezbedjuju-rast-bdp-a_1215262.html
The Agro Belgrade 20201 conference was held at the Belgrade Fairgrounds, with Agriculture Minister Branislav Nedimovic and Belgrade Secretary of Agriculture Milinko Velickovic in attendance. During the conference Minister Nedimovic noted that Serbia’s agricultural sector set important records in 2020, most notably the USD 4.13 billion worth of agricultural exports. The represents a 65% growth over the USD 2.5 billion exported just five years ago. For his part, the Belgrade Secretary announced that Belgrade was continuing to increase the amount of funds intended for agriculture each year. Specifically, he noted that a total of RSD 200 million in subsidies are available this year for the purchase of machines, tractors and livestock as well as for fruit and vegetable growing and beekeeping.
23) Serbian Agricultural Sector Achieving Strong Results March 2nd, 2021, http://www.tanjug.rs/full-view_en.aspx?izb=634895
Agriculture Minister Branislav Nedimovic and Sem Fabrizi, head of the European Union (EU) Delegation to Serbia, met to discuss the recent performance of Serbia’s agricultural sector. Both noted that the sector is performing well and has a strong trading relationship with the EU (the EU accounts for 75% of Serbia’s agricultural trade). The two also discussed reform measures necessary to further progress the sector, particularly the most demanding ones related to EU accession, as well as the use of EU funding under the IPARD 2 program.
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Prepared by Business & Finance Consulting (BFC) www.bfconsulting.com Articles are taken directly from local sources without any fact-checking; they are provided as a convenience and for informational purposes only. Business & Finance Consulting (BFC)’s editing is limited to providing a short summary in English of the texts, highlighting the main points of the original articles. All rights reserved by the authors. BFC takes no responsibility and does not make any representation or warranty, express or implied, or assume any responsibility whatsoever for the content, accuracy, and reliability, or completeness of any of the articles.
