Corn Subsidy Cut to 18,000 Dinars as Drought Kills Harvest

The per hectare subsidy for this season stands at 18,000 dinars, roughly 150 euros, down from the 35,000 dinars, about 300 euros, paid out last year. The cut of 17,000 dinars per hectare has landed in a summer when, according to what agricultural economist and Faculty of Agriculture professor Miladin Sevarlic is hearing from colleagues on the ground, there will be nothing left to cut in northern Banat.

“Colleagues are telling me there will be no corn harvest at all from Kikinda to the Hungarian border,” Sevarlic said. In Macva, he adds, the drought set in before the ears could even form, so it is an open question how much plant mass will be left even for silage.

What’s Actually Left of the 18,000 Dinars

Sevarlic calculates that at least 10 percent, and in some cases as much as 20 percent, has to be deducted from the subsidy, depending on how inputs were purchased. After that deduction, a farmer is left with between 14,400 and 16,200 dinars per hectare, or between 123 and 139 euros. Against last year’s 35,000 dinars, that is less than half, and it comes in a season when part of the acreage will produce no yield at all.

His proposal is a budget rebalance and an additional 17,000 dinars per hectare, paid out without requiring receipts, as was done last year. On top of that, he is asking for three structural measures for central Serbia: land consolidation, maintenance of field roads, and a subsidy for digging wells, an option that exists in Vojvodina but not south of the Sava and Danube.

What’s Left in the Fields

Soybeans, in his assessment, are in worse shape than corn. Sunflowers are holding up, but not everywhere.

“Sunflowers are still holding up, since they’re the most drought resistant crop, but only where farmers fertilized properly and invested in production.”

That qualifier is key to the math: how well a crop withstands this year’s drought depends on how much was invested in it beforehand, so farms that skimped on fertilizer lose twice over. Heat is an added factor. “The leaves are practically scorching here, the plant can’t breathe,” Sevarlic says.

Water: Intake Bans and Dry Wells

A ban on drawing water for irrigation has been introduced in Backa and in Gornji Milanovac, and a pumping station in Grocka has been temporarily shut down. In Begaljica, at least 30 hectares are planted with berries, while some 200 hectares rely on a system that is now closed.

Producer Jovica Zivanovic from Begaljica has put roughly 30,000 euros into his operation. Just three irrigation connections, at 300,000 dinars, or about 2,560 euros, apiece, cost him 12,000 to 13,000 euros. For some producers nearby, wells have dried up completely this year.

The distribution of rainfall explains the gap between regions. In July 2026, northern Backa and Banat recorded less than 10 millimeters of rain, while lowland areas of southeastern Serbia got between 40 and 80 millimeters. More than 90 percent of the water flowing through Serbia’s rivers comes from upstream countries, so the decision on whether Backa gets to irrigate is effectively made by rainfall that fell somewhere else.

Hundreds of Millions Invested, System Idle

The Ministry of Agriculture lists what has been invested in irrigation over the past decade:

• $97 million from an Abu Dhabi Fund for Development loan, to create irrigation conditions for more than 122,400 hectares
• 48 million euros from a European Bank for Reconstruction and Development (EBRD) loan
• $75 million from a Saudi Fund for Development loan

The Arilje and Selova reservoirs are under construction, while construction of the Pambukovica dam, financed through the EBRD loan and covering 2,225 hectares, has yet to begin. That figure is worth comparing to the earlier ones: it amounts to about 1.8 percent of the area covered by the Abu Dhabi arrangement. Even the system that already exists is not doing much this year, since at such low water levels there is nothing left to draw.

Prices Fell, but So Did the Harvest

We previously reported that corn on the exchange had fallen to 20.20 dinars. The combination is unfavorable for producers: exchange prices are low, and the volumes that would have sold at that price will not even be harvested. Sevarlic draws a distinction between the price of raw grain and the retail price of food.

“Raw material prices are practically the same as they were 10 years ago, while in the meantime every input and every piece of equipment has gotten drastically more expensive.”

Livestock farming adds another blow. African swine fever has also hurt farms it never infected, indirectly, since they can’t sell piglets in the highest paying category, so the animals grow into fattening pigs sold at a lower price, alongside unplanned purchases of animal feed. Sevarlic expects this to translate into higher imports of frozen meat from European Union countries, Brazil and Argentina.

“What our importers bring in is meat that has already passed its six month shelf life and is unfit for human consumption in the European Union.”

Two things are worth watching next: whether the budget rebalance restores the missing 17,000 dinars per hectare, and how much moisture is in the soil going into the autumn planting. Sevarlic says farmers will be back protesting again this fall.