I don’t remember times when vegetables and fruits being as expensive as this year. According to the law of supply and demand, does lower production lead to higher prices or is something else is at stake?
The comparative advantage of Macedonian economy is the sun, the land and cheap labor. At least that’s how it used to be. We still have the sun, the land is cultivated less and less, the livestock fund is decreasing and the labor force is running out of the state and it is more and what is left is more is more expensive.
I will tell you about three meetings from my travels through Macedonia.
Somewhere in the part of the country known as Pelagonia, I am talking to two young people, one from Pelagonia and the other from the surroundings of Krushevo. The topic is tobacco as an agricultural plant. Tobacco as an agricultural plant is difficult to work with, repro materials are expensive and climate changes does not have a good effect on agriculture as a whole. “And how is it, do you make a living from tobacco?” I ask. To paraphrase, the conversation leaded that planting and harvesting tobacco is difficult and that it does not pay enough. But when I asked ask about the production costs, we came to the fact that the subventions, provided by the state, cover a large part of the costs (not taking into account putted work and time) and that depending on the sell price you can earn quite a lot and live well from it.
I am driving through Prespa with a relatively young (about 38 years old) man. On one side of the road, apples on the trees smile with beauty, weighed down and ready for harvesting. On the other side of the road neglected apple trees, the apples on the trees seems desperate. “These beautiful ones are mine,” my host brags, “and the others are just for that their owners to get subventions in money.” My host continues, “My family and I invest in machinery and equipment. I educate myself and I follow modern trends in cutting and providing care for fruit trees. It’s hard, but that’s why this year I expect a rich crop and a rich income, considering the sell prices.” Hi added. “It pays off. Not every year is good, but this year is great.”
A month or two ago, in a conversation with the owner and director of a factory for processing and canning vegetables from the Valandovo-Dojran region, I asked about the purchase price of red pepper, ajvarka, this fall. The gentleman tells me: “40.00 to 50.00 mkd (0,7 up to 0,8 eur per kilogram) to buy it direct from the field. The purchase price causes us big problems because we already have agreed prices for the finished product to our buyers, and that price was agreed back in February and March. Now we are forced to raise our product price, and often contracts are canceled or the quantity byers ordered is reduced.” I ask why the price is high this year. “Instead of joined and united producers, who will join together and produced together, with reduced production costs, it happens that people move out from the land and country and the planted areas decrease. And less crop leads to higher price”
I have not been engaged in agriculture ever, I can only guess how tedious and at times unthankful it is. But it is disastrous to run away from what we can and must be strong in, which is food production. I believe that one of the reasons why this is so is the uncertainty, both from the weather climate but also from the unstable sell prices.
The strategy for the development of agriculture and processing industry should be made or existing one to be improved. First of all, the domestic product should be protected by introducing high taxes and fees for imported vegetables, fruits and other. I will remind the older readers how the planting of sugar beet in Macedonia was ruined in the 1990s. at that time the sugar factory from Bitola had a long-standing practice of concluding cooperative agreements with farmers from all over the country for the production and purchase of sugar beet, but due to various interests of individual traders, the import of unrefined sugar from China was allowed in our country and the story with sugar beet ended infamous. Meaning that people stopped planting sugar beet.
Also, during the covid crisis it become obvious how dependent we are on importing unrefined cooking oil. And even though we have a factory that can make oil from sunflower, this crop is almost not been planted here.
My opinion is that one of the possible solutions is to be founded several ” Agricultural Stock Markets ” throughout the country, for example in Strumica, Prilep and Skopje. The Agricultural Stock Markets can be organized on the principle of private public partnership. Agricultural Stock Markets would also be institution that would implement the strategy for the development of agriculture, that is, they would motivate and encourage farmers to grow sunflowers, poppy, cotton and other crops. They would act as mediators in the process of issuing a long-term lease on state-owned agricultural land to interested individuals and companies.
The most important thing is that the Agricultural Stock Markets would enter into cooperative agreements with the farmers with a guaranteed purchase price of the products. This would remove the uncertainty surrounding the selling of manufactured plants. The purchased products would then be sold by the Stock Exchange according to the principle of stock market sale. That is, depending on the demand but not lower than a certain price. The Agricultural Stock Markets would keep the part of the unsold products as state commodity reserves and in case of price growth, products would be placed on the market at cheaper prices. Agricultural Stock Markets would also be consultants and would help young farmers, first of all, in accessing money from European funds. In addition, Agricultural Stock Markets companies can be engaged in the selling of seed material, fertilizer and other means for farmers needed for quality production.
I will go a step further, and that is that the food processing industry must be supported and helped by the state with cheaper reproduction materials or similar. A true example of that should be our neighboring Serbia with the measures it takes to help its food industry.
Furthermore, all food products need a control body from the state (perhaps the Food and Veterinary Agency) to control and issue a certificate for the quality of vegetables, fruits and food products. All these (food products from Macedonian companies with a minimum of 80% of the fruits and vegetables used are from Macedonia) should be branded as a trademark produced under the Macedonian sun (this has nothing to do with the campaign for products with the little sun from the past). This new brand which will become known and recognized at home, in the region and around the world.
Folks, only homemade is homemade and so tasty.
М-р Раде Чоловиќ
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