Serbia Newsflash Week 16, 2022

Declining raspberry and dairy exports, supply chain issues due to the war, a record sugar beet growing, rising input costs in arable farming and the food sector, and food prices climbing due to inflation - the week in Serbian agriculture.

Close-up of frosty raspberries.
Beeld: ©Jona Novak
Due to the COVID-19 crisis and the war in Ukraine, Serbia's raspberry exports have considerably declined in volume.

Raspberry exports from Serbia also in decline due to crises 

Exports of frozen raspberries from Serbia, have decreased significantly in the last two years due to the COVID-19 crisis and the war in Ukraine, the Group of Producers of Fresh and Frozen Fruits and Vegetables of the Serbian Chamber of Commerce (PKS) stated last week.

In January this year 5,570 tons of frozen raspberry have been exported, which is about 30% less than the figure from the same time last year when 7,930 tons were exported, the statement reads. Comparisons of exports during the first two months of 2020, 2021, and this year shows the continuation of the trend of reduced export quantities. During the first two months of 2020, 19,700 tons of frozen raspberries were exported, in the same period  2021, the volume was 3,000 tons less, and in the same period 2022, it was only 11.180 tons, the statement reads. Exports to Germany, the largest market for Serbian raspberries, halved in January this year compared to January 2021.

The reasons for the decline in exports lie in the fact that consumers, due to the high price of frozen raspberries and blackberries, buy cheaper products such as mixes or frozen exotic fruits, and they are more focused on buying basic foodstuffs, such as cooking oil, flour, and sugar. At the same time, industrial buyers who produce yogurts, jams and similar products, excluded raspberries, and blackberries from their production programs due to the high price and replaced them with cheaper fruits, reports the Serbian Chamber of Commerce.

Delta Agrar breaks record, sugar beet yield at 80.4 tons per hectare 

Delta Agrar has realized an average yield of sugar beet of 80.4 tons per hectare, which is around 55% above the average in Serbia, which is 52 tons per hectare. The Topola farm had an average yield of as many as 87 tons per hectare. At the Kozara farm, an average digestion (the percentage of sugar in the sugar beet) of 17.9 tons was achieved, whereas, on a parcel of 46 ha, the digestion reached as much as 19.8 tons. The average digestion in Serbia is around 16 tons, as reported by the portal. With such yields and digestion values, Delta surely belongs among the world’s best producers of sugar beet, the company says. 

Al Dahra Serbia to invest €25 million in production by the end of the year 

The agribusiness corporation Al Dahra Serbia, which purchased the Belgrade-based food industry complex PKB three years ago, announced that it would invest an additional €25 million in development of production by the end of the year. The statement reads that  €9 million would be invested into modernizing arable crop machinery, with the rest set aside for boosting production in other segments of operations, as well as, for the start of works on the irrigation project.

Besides the investments announced for 2022, Al Dahra plans to implement the €80 million in irrigation and a drainage project in the next four years. Al Dahra Serbia CEO Dusan Radicevic said that, since the start of its operations, the company had invested around €60 million – double the amount stipulated in an agreement signed with the government. Radicevic said the investments had quickly produced record-high results and noted that last year, wheat, barley and rapeseed yields had amounted to 8.2, 8.9 and 4.4 tons per hectare, respectively. 

Soya plants with ripe soybeans can be seen in the sunset.
Beeld: ©Liam Michaels
The input costs of arable crop farming - Maize, sunflower and soybeans - are steadily increasing as the costs of sowing are rising. Sowing is about 45% more expensive this season.

Increasing sowing costs

This year, the sowing of agricultural crops - corn, sunflower and soybeans in Serbia is about 45%  more expensive than last year. Sowing takes place in inadequate conditions because in some areas there is not enough moisture, while in others, due to heavy rains, crusts formed on the surface, so crops cannot sprout, farmers warned today, reports TV N1.

Food prices in Serbia continue to rise due to the war in Ukraine

The war in Ukraine has exacerbated the difficulties regarding the procurement and price of raw materials for the food industry in Serbia, causing new problems to companies doing business in the Russian and Ukrainian markets, says the monthly paper Biznis i finansije.

The price of transport to Russia has gone up by 100%, and businesspeople working there say that the extremely unstable exchange rate of the Russian Ruble is an even bigger problem. According to some estimates, the situation on the market will additionally worsen in the next period, while the prices of food will continue to grow.

The Serbian Government has limited the export of wheat, flour, corn and sunflower oil. Traders are not happy about the measure, but experts say it is justified in the extraordinary situation, noting that other countries have done the same, the newspaper reports.

The export of dairy products to the Russian market decreased

Since the beginning of the war in Ukraine, the Kragujevac-based KUC Dairy has halved the monthly sales of dairy products to the Russian market. As the owner of the company Jezdimir Kuc told the Beta agency, due to the increased risk in the transport of goods, the conditions of purchase have been tightened.

“The buyer is taking over our goods at the gate of the company and taking the risk of transport,” Mr. Kuc said, pointing out that there are changes in the payment of goods, so the buyer pays the full amount for the order 20 days in advance. “Since the beginning of the conflict in Ukraine, the quantities KUC Dairy delivered to the Russian market per month have been halved. We have delivered dairy products two to four times per month, and now one to two times per month,” Mr. Kuc added. However, according to him, the order for dairy products for the Russian market increased in May.

Mr. Kuc reiterated that his company was among the first in Serbia to start exporting products to the Russian market. It was among six dairies that received export permit for dairy products to the Russian market in 2011. Another five dairy producers got the same permit afterwards.