Serbian Corn Yield Falls 30-40%, Price Drops to 20.30 Dinars
The Institute of Agricultural Economics projects a 30 to 40 percent drop in corn yields, while the Novi Sad Product Exchange saw corn prices slide from 21.00 to 20.30 dinars per kilogram in a week.
Serbia’s corn yield this season will come in 30 to 40 percent below what a normal harvest produces, according to agroeconomist Mladen Petrović of the Institute of Agricultural Economics. His baseline is seven to eight tons per hectare, the amount a hectare delivers when water isn’t the limiting factor.
The culprit is temperature. Petrović says that once readings pass 35 degrees, kernel filling stops, and every degree above that threshold translates directly into lost yield mass. Corn in Serbia has been sown on 950,000 to one million hectares in recent years. The average yield over the past decade was 6.15 tons per hectare, but over just the last five years that average slipped to around 5.4 tons.
Those two averages say more than the drought estimate alone. Strip 30 to 40 percent off seven to eight tons and the range that’s left is 4.2 to 5.6 tons per hectare, and the upper end of this year’s drought math lines up almost exactly with the five year average. What counted as a bad year a decade ago has become the norm over the last five seasons.
Why isn’t the price rising as the harvest shrinks?
A smaller harvest should, in theory, push prices up. At the Product Exchange in Novi Sad, the first week of August produced the opposite. Corn offers opened at 21.00 dinars per kilogram excluding VAT, but sellers, facing weaker demand and lower price signals from buyers, corrected downward. The deal that closed came in at 20.30 dinars excluding VAT, which also stands as the week’s weighted average, with some volume changing hands at 20.20 dinars on longer payment terms.
A drop of 70 para in a week works out to 3.3 percent. Buyers, in other words, are in no hurry to chase a supply that’s about to shrink.
The aflatoxin detail shows just as clearly how the market is pricing risk. The 20.30 dinar deal was struck for corn with no aflatoxin testing done, while demand for grain with a measured aflatoxin content under 20 ppb was quoted at 20.50 dinars, 20 para higher. That deal never closed, since there wasn’t enough tested grain on offer and prices didn’t quite meet in the middle. Buyers were ready to pay more for corn with a documented aflatoxin reading, and drought years are precisely when that risk climbs.
On the field: from 12 tons per hectare to 3.4
Farmer Milan Bogunović from Banat described on August 4 the gap between what his land used to produce and what awaits him this fall:
“We used to pull 12 tons of corn per hectare out of this drought prone Banat of ours, and now we can forget that, we’ll be making somewhere between 0 and 3.4 tons per hectare.”
His second complaint touches a fix that’s been counted on for years. With water levels low and canals running short, irrigation this season isn’t helping everyone equally.
“The state invests in irrigation systems, and there’s no water in the systems. What more can I tell you?”
The arithmetic that follows is simple. A hectare yielding 4.5 tons, sold at the weighted price of 20.30 dinars, brings in 91,350 dinars gross, before the cost of seed, fertilizer and fuel. As reported earlier, the per hectare subsidy was cut to 18,000 dinars, in a season when corn across large stretches of farmland is coming up short.
What’s happening with other crops
The same week on the Novi Sad exchange brought thin trading in other crops as well:
- wheat traded at 20.50 dinars per kilogram excluding VAT, on a CPT port or buyer parity
- soybean was offered at 53.50 to 54.00 dinars, with demand quoted at 52.30 to 53.50 dinars, so no transaction went through
- the sunflower harvest has begun, with demand quoted at 445 euros per ton and no deal closed
- feed barley ranged from 18.00 dinars on FCA parity to 18.50 dinars on CPT parity
- rapeseed was offered at 475 to 480 euros per ton, with no buyer interest
The next reliable reading will come from the harvest itself. Once the combines start rolling, estimates on paper give way to actual measured mass per hectare, and that’s when it will become clear whether a smaller supply finally pushes prices higher, or whether imports and weak demand from processors keep corn hovering around twenty dinars.
