Plum Harvest Price Falls Below Cost of Picking

The purchase price of plums grown for processing in Sumadija ranges from 20 to 25 dinars per kilogram, while the cost of picking alone, depending on how the work is organized and how heavy the crop is, runs from 10 to 20 dinars. Those two figures sum up the whole season: in the worst case, a grower is left with just one dinar per kilogram, and that is before crop protection, fertilizer and fuel are even factored in.

The crop itself is abundant. In Stragari near Kragujevac, at the foot of Mount Rudnik, the weight of the fruit has bent branches, and in some cases broken them. Miroslav Cicic, a grower from Stragari whose orchard is a quarter of a century old, estimates this year’s average yield at around 35,000 kilograms per hectare.

“This year’s crop is so heavy that you can find fruit all over the orchard,” Cicic says.

Serbia ranks first in Europe and third in the world in plum production, with orchards covering more than 70,000 hectares. That standing does not translate into the price a grower gets at the buying point.

How Much Is Left for the Grower After Picking Costs

At a yield of 35,000 kilograms and a price of 22.5 dinars, the midpoint of the processing range, a hectare brings in about 787,000 dinars (~6,700 EUR) gross. Picking that same hectare costs between 350,000 and 700,000 dinars. What is left after that is 87,000 to 437,000 dinars, and only from that sum does the grower still have to pay for:

• crop protection
• fertilizer
• fuel
• other production costs

In the worse case, the margin is negative, and in the better case it is reduced to a level at which a multi year orchard is hard to sustain, let alone renew. That is why growers are already saying they will keep a larger share of the crop for their own use and send only the rest to market, both domestic and European.

First Class Pays Double, but Not the Whole Crop

First class table plums fetch a significantly better price than those destined for processing. Vladimir Hadzic, who grows plums on four hectares, sums up the gap briefly: “The price for first class table fruit is around 50 dinars, and for processing it’s 25 to 30 dinars,” he says, adding that the prices on offer fall below the threshold of economic viability.

At an average yield, four hectares produce around 140,000 kilograms. At the processing price of 25 dinars, that is about 3.5 million dinars (~30,000 EUR) gross, while picking that crop alone costs 1.4 to 2.8 million dinars. The gap between the table and processing prices is twofold, but only part of the crop qualifies as first class: the rest, based on size and damage, drops into a lower price bracket.

Why Plum Prices Have Fallen to the Level of Grain

This year’s purchase price for processing plums is practically at the same level as corn, which fell to 20.20 dinars per kilogram after the drought. These are two very different production cycles: corn is sown and harvested in the same year, while a plum orchard needs several years to reach its first full yield, with money going into crop protection every single season regardless of whether the price will ever cover that investment. When the two figures converge, the math behind planting a new orchard changes.

What the City Covers, and What the Ministry Covers

Investment in equipment and insurance runs through two levels of government. Snezana Zivanovic Katic, a member of the Kragujevac City Council for balanced and sustainable development of town and countryside, says the city covers 30 percent of the crop insurance policy, while growers get the remaining 70 percent through the Ministry of Agriculture.

The biggest item is machinery.

“The biggest investment, and the most important one, is certainly the tractors. This year the City subsidized 64 new tractors with up to 700,000 dinars each.”

The maximum subsidy per tractor, 700,000 dinars (~6,000 EUR), is nearly equal to the gross revenue one hectare of plums brings in at this year’s processing price. The support goes into equipment, not into the price, so it does not change the math of picking.

Slower Buying Season Than in Previous Years

Last season in Sumadija was marked by drought and bad weather, leaving some households without enough fruit even for their own needs. This year there is a crop, but selling it is the problem. Buying is being organized more slowly than in previous years, in some places there are no buyers at all, and growers are starting the harvest without a confirmed buyer or a known price.

One consequence already taking shape is that part of the crop will go unpicked, because the cost of picking it will not be covered. Growers also say fewer and fewer of them invest in new orchards each year, and some are considering cutting production or giving up on plums altogether.

Stragari is meanwhile hosting the “Sumadija Plum Days,” an event that has run, with breaks, since 2009. Mirjana Milenkovic, director of the Kragujevac City Tourist Organization, says the program brings together more than 100 exhibitors and around 350 participants. The event is held on Sumadija Plum Street, at the foot of Mount Rudnik.

For most growers, the season comes down to one question: how much of the crop can pass as first class at 50 dinars, because anything that falls into the processing bracket at 20 to 25 dinars barely covers the cost of picking it.