Bosnia and Herzegovina: Mills Favor Imported Wheat
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In Bosnia and Herzegovina, Wheat is an important commodity, both culturally and strategically. It is used to produce the leading staple food – bread – vital for ensuring food security in the country. Yet, Wheat accounts for only a small share of agricultural GDP (around 5 percent), and domestically produced Wheat makes up for only a small portion of Wheat consumption in the country.
Wheat in Bosnia and Herzegovina is mainly produced by small family farms averaging 2–5 ha, with low use of fertilizers, chemicals, and certified seeds, by applying relatively old crop and post-harvest management practices. As a result, Wheat quality and yields are low (between 3–4 tons per ha compared to 5–6 tons per ha of average Wheat yields in the European Union). It negatively affects the farmers’ revenues. In addition, poor land management decrease quality of soil, leading to even more significant problems with improving yields.
In MY2021/2022, the Wheat crop was planted on 65,350 hectares (HA) with excellent weather conditions and an expected production of 274,470 MT (average 4.2 MT/HA). The Wheat area declined by seven percent compared to MY2020/2021, when 321,804 MT of Wheat was harvested on 69,914 HA (above average yield of 4.6 MT/HA). Winter barley was planted on 14,195 HA, triticale on 12,586 HA, and winter oats were grown on 4,381 HA, with no major changes from the earlier season.
Old technology, outdated mechanization, and low investment capabilities affect Wheat quality. Bosnian farmers report they cannot sell their Wheat at prices that compete with low-priced Wheat from neighboring countries such as Serbia. Farmers also think local mills prefer imported Wheat because it is cheaper, while local mills say they cannot make good-quality bakery products from locally produced Wheat.
“We are now fighting like lions with a purchase price that is not satisfactory. The inaccuracy of the milling and baking industry contributed to this. We are offered 55 pfennigs for a kilogram of Wheat, which shows that they are shameless. Meetings should be held with authorities from all levels of Government, and if things do not change, we are ready to spill the Wheat on the road.” Savo Bakajlić, President of the Semberija Farmers’ Association, said. Farmers would be satisfied with 80 pfennigs per kilogram of Wheat.
“This year’s yields are variable and range from 3.5-4.5 tons of Wheat per hectare, and it is important for us that the quality is good. The below-average air humidity also contributed to this”, added Bakajlić.
Bosnia requires 550,000 MT of Wheat annually. Wheat stocks are estimated at 100,000 MT. Bosnia’s grain market is relatively small, and grain mills are unable to create larger stocks; thus, the effect of global Wheat price fluctuations is significant. Wheat stocks from the previous season are used as animal feed, and some are kept for on-farm use. Ten percent of Wheat is usually used as feed.
Bosnian Wheat Trade
The major part of the demand is met by large imports from Hungary, Serbia, and Croatia. Domestic consumers prefer the higher-quality imported Wheat, and not all domestic production is consumed locally; the remainder is exported. In CY2020, Bosnia imported 337,400 MT of Wheat valued at $75 million from Hungary, Serbia, and Croatia. Bosnia exported 36,508 MT of Wheat valued at $16.8 million, mainly to Croatia and Turkey.
After establishing a free trade agreement (in 2003, revisited in 2019), Turkey became a leading export destination for Bosnian Wheat. However, in the last years, exports decreased significantly as Turkish millers were dissatisfied with the quality of imported product.
Other sources: USDA
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