As Poslovni Dnevnik/Jadranka Dozan writes, due to the unprecedented drought and owing to the impact of energy prices on production costs, including the problem of lack of fodder, Croatian farmers are rightly fearful of an extremely uncertain autumn. Several counties across the nation have declared a natural disaster, and the agricultural sector is increasingly relying on the government’s autumn aid package.
The board of directors of the Croatian Chamber of Agriculture (HPK) said after last week’s session that it believes that the government will now help suffering Croatian farmers as it did with hotels and inns after the outbreak of the global coronavirus pandemic back in 2020.
”Without the powers that be stepping firmly in, long-term consequences are likely, not only for this part of the economy, but indirectly for others as well,” warned Mladen Jakopovic, president of the HPK.
The Chamber had input calculations made in certain segments of production, and Jakopovic says that this will show the losses suffered by Croatian farmers and the rest of the domestic agriculture sector. Representatives of the Chamber recently presented some proposals to Minister Marija Vuckovic and Prime Minister Andrej Plenkovic, from earlier advance payments of subsidies and cancellation of leases for agricultural land and the gradual abolition of blue diesel. On Friday, at the opening of Viroexpo in Virovitica, the Prime Minister said that the government will “take care that Croatian farmers and fishermen get a special place in the new package”.
Croatian farmers say they’ve never experienced a drought like this one, and the same is true for other European farmers across the continent. Even in the United Kingdom, known for its relatively pleasant summers and plenty of rain, the situation has been bizarre. The very concerning data from the so-called dashboards of the European Drought Observatory also confirm that what we’ve experienced this year is unusual.
The drought hit the spring crops the hardest of all, and although the drop in yields also depends on the area’s micro location, both corn and potato crops suffered the most, but barley, sunflower, and wheat also had significantly lower yields. The combination of drought and intermittent heat waves also caused the forced ripening of various fruits and vegetables. At the same time, the movement of gas prices, announcements of an imminent increase in the price of electricity and more expensive artificial fertiliser make this autumn’s harvest uncertain, although the weather conditions are currently encouraging for the sowing of rapeseed, for example. The situation is no less burdensome in animal husbandry, either. All production cycles that take place within closed spaces are more exposed to rapidly rising energy prices.
Along with the weak corn crop, there is also the problem of corn silage, which “almost doesn’t exist”, according to the head of HPK. Some herders from Lika complained that they had already started their animals on consuming “winter food” in the middle of August. In some neighbouring countries, cattle have also started to be sold for these reasons. This is precisely why the recent drop in meat prices on European stock markets, especially beef, is attributed to this, but they could go up again with the winter months.
”There are expectations of weakening demand due to expensive energy and fears of recession, as well as the pressure of quantities from the Black Sea on prices and difficult logistics. Then we’ve got the problem of droughts acrpss Europe and Asia, not to mention the constant risk of a new escalation of the conflict in Ukraine,” pointed out Robert Jurisic from the company S-Grain BI, which specialises in agricultural commodities.
Due to the high price of gas as a result of spiralling inflationary pressures, a number of fertiliser producers across Europe have announced they’ll soon stop being made. (the Norwegian Yara, the German SKW Piesteritz and BASF, the Polish Azoty). The problem of energy products is being constantly and intensively dealt with within the European Commission (EC), which is now strongly considering the possibility of freezing prices. The government’s package is expected sooner than usual, and whether Croatian farmers will be satisfied with their share of these billions will be known soon.