Sunflower Price at 44 Dinars: Farmers Meet Government
Farmers and dairy producers meet Serbia's Government and sunflower oil processors tomorrow at nine, over a 44 dinar per kilogram purchase price for sunflower seed and low milk prices.
The advance purchase price sunflower oil processors are offering this year’s growers stands at 40 dinars per kilogram, or 44 dinars once value added tax is included, Nedeljko Savic, president of the “Stig” farmers’ association, told the Beta news agency. Milk producers plan to challenge that same price tomorrow, in talks with representatives of Serbia’s Government.
The meeting is set for nine o’clock tomorrow morning. According to Savic, invitations went out to farmers’ associations from Stig and Kikinda, the Club 100P Plus, the Association of Milk Producers of Sumadija and Pomoravlje from Kraljevo, and the “Our Milk” association, after they had earlier requested talks with Prime Minister Djuro Macut over low prices for crop products and milk. Alongside the farmers, representatives of the Ministry of Internal and Foreign Trade and the Ministry of Agriculture will sit at the table, as will representatives of oil processors and other sunflower buyers.
Savic also explained how the processors arrive at their price.
“The price the oil processors are offering for sunflower this year comes nowhere close to covering production costs. The processors set the purchase price of sunflower seed based on the world market price of crude sunflower and palm oil, which stood at 800 dollars per ton last year and is 1,200 dollars this year,” Savic told Beta.
In other words, the price of crude oil has risen by 50 percent compared to last year, while the advance price growers receive for their raw seed has either stayed flat or dropped, depending on which of last year’s figures is used for comparison. Sources differ here: Biznis.rs quotes Savic putting last year’s purchase price at around 62 dinars per kilogram, while Nova ekonomija, reporting the same day, cites 60 dinars. Either way, the drop is in the double digits, somewhere between 27 and 29 percent.
An advance price of 44 dinars per kilogram works out to just under 0.38 euros at the National Bank of Serbia’s middle exchange rate. Last year’s price of 60 to 62 dinars, by the same conversion, was between 0.51 and 0.53 euros.
Savic argues the low price is not the result of market conditions but of an agreement among the processors to offer a single, unified price, which he says has removed competition between buyers. The harvest itself, meanwhile, has been more than cut in half by drought. In Vojvodina, around 80 percent of the crop had been harvested by mid August, while in Stig the harvest is only just getting underway.
Predrag Veljkovic, president of the Association of Milk Producers of Sumadija and Pomoravlje, will use the meeting to press the Government to push dairies into raising their milk purchase price. According to Veljkovic, dairies have cut that price repeatedly since the start of the year, citing stockpiles that, he says, no longer exist.
“On top of that, Europe is also dealing with drought and a shortage of livestock feed, just like Serbia, so prices should be going up now,” Veljkovic told Beta.
Ahead of tomorrow’s meeting with the Government, Savic also announced that representatives of the farmers’ associations will hold their own meeting in Pozarevac tomorrow evening, starting at eight, to agree on what steps to take against the oil processors if the morning talks produce no progress. Savic said that before any more drastic moves, they would first offer the processors a conversation about the purchase price.
The outcome of tomorrow’s meeting is not yet known. Whether the advance price of sunflower stays at 44 dinars, or the processors offer more under pressure from the Government, will depend on the decision reached by the Ministry of Internal and Foreign Trade and the Ministry of Agriculture. The dairies’ response, meanwhile, will decide whether the string of milk price cuts that has run since the start of the year continues.
