As expected, the Russian ban hit hard the fruit and vegetable growers, as they are now flooded by excess quantities that have to be redirected towards the domestic market, thus overburdening the local trade. “Our members complain last month saw a radical revenue decrease of about 20%-30%“, says Ion Cioroianu, adviser with the Romanian Farmers Association. According to Gheorghe Vlad, president of the Vegetable Growers Association, companies in intensive farming will be the most affected, especially those in the protected vegetable crops sector, owning large greenhouses on areas exceeding 10 hectares.
An impossible competition
Imported fruit and vegetables are more popular because of much lower prices, sometimes half the price of Romanian products. “There is a 10-15% average price difference. Even fruit and vegetables from Moldova are cheaper. We keep saying we want to support their country, but this is a real double-edged sword. It turns we are able to help Moldovan producers, but not Romanian ones. Because of the high prices of seeds and fuel, we have no choice but to maintain the prices at a high level, in order to have any kind of profit. For example, there are cases when the producer asks 50 bani for a kilo of tomatoes, while the dealer will sell it at 3 lei”, Cioroianu explains.
Amid the fruit producers, the most stricken are the apple growers; amid the vegetable producers, the onion growers are the most affected. “In Galati, for example, the onion harvested from a 2,000 hectares lot remained unsold. So, not only are we facing a lower output compared to last year, but we are also forced to cut down the prices, since imported vegetables are sold half the price we advance. Tomatoes from Poland, for example, are sold at 1,5 lei per kilo. If we came with such a price, we couldn’t cover our investment, let alone report any profit”, says Aurel Tănase, managing director of the Prodcom National Fruit and Vegetables Interbranch Organization. For now, he adds, there is a slight demand rebound, due to the winter supplies. “All in all, still, the embargo wreacked havoc on the market. To avoid similar problems in the future, we need better regulations and policing”.
As for the amount of damages, Tanase says a letter was sent early last month to the European Commission denouncing the current state of the fruit and vegetables sector. “As a result of damages produced by the Russian embargo, we requested a 300 million euros grant to cover the losses, as opposed to Netherlands, for example – whose government advanced a 1.5 billion figure. The Common Agricultural Policy implies an intervention instrument, a back-up fund of 442 million euros available for crisis situations. This time, only 125 million were made available to European farmers, out of which Romania is entitled to 10 million”.
He also points the finger at retailers, who, instead of supporting local farmers, opted for the cheaper, more at-hand import products. Retailers, on the other hand, claim the Russian ban had little if any effect on their acquisition plans. “There were no changes in this respect during last month. As always, we are only interested in the price and quality offered by our suppliers”, says Delia Nica, CEO, Romanian Retailers’ Association. She maintains that all member companies aim to reach a share of local products of 80-90%.
85%- 98% of all fruit and vegetables on the French retailer’s shelves come from local producers.
10 million euros is the amount Romanian producers could receive from the European Commission.
