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2013-Record agriculture production backing Romania economy above expectations this year
Agriculture - the sector having registered plant productions ranked as 40-year records and having backed the Romanian economy above expectations - has been the 2013 star.
From 1.6 percent forecast in this spring, the Romanian economic growth was revised upwards to 2.2 percent for year-end, with the increase in the agricultural gross added value being put at 11.9 percent, up from an original 6.4 percent.
Against the background of favourable weather conditions and also of the measures taken by the authorities with respect to irrigation, the plant production will exceed 22 million tons this year, being close to the 2011 levels, but marking a 50 percent surge from last year, when the drought 'burnt' the crops down to a meagre 14 million tons.
This year's record crops were obtained thanks to 'a mixture of good weather and administrative measures' and this has contributed to also cutting the untilled lands to just 300,000 hectares this year down from some 2-3 million hectares in the prior years, Agriculture Minister Daniel Constantin said.
According to statistic figures, the Romanian wheat production hit 7.296 million tons this year, up from 4.7 million tons last year, thus being the largest crop in eight years; the barley and two-row barley crop exceeded 1.511 million tons. Romania had the European Union's best sunflower crop of 2.088 million tons, up from 1.3 million tons in 2012, while the corn production doubled from 5.4 million to 10.7 million tons.
Grain exports have become increasingly profitable for Romania in the last years, with Romanian wheat and corn keeping being some of the most in demand agricultural produce in the foreign market. Romania shipped 4.5 million tons of wheat and corn to Egypt, Saudi Arabia, Iran, Italy and Spain in the nine months alone.
On the other hand, the Romanian farmers said that the grain prices this year have dropped to half last year's, in spite of having had higher crops than in the prior years and they said that, unfortunately, they will not succeed in covering their expenditure. The farmers insist that prices such as 0.50 - 0.60 lei a kilogram of wheat and corn and a leu a kilogram of sunflower were a 'shame', being utterly insufficient to recoup the investments and resume the agricultural cycle in this autumn.
The move to cut the VAT on bread and milling products to 9 percent from Sept. 1 yielded its first result in the cut bread prices by 10-12 percent on average, according to the authorities and it also resulted in much higher quantities of flour and bread 'surfacing', but the revenues to the budget have failed to impress.
The Romanian authorities are considering a VAT cut on the organic products in a move meant to boost domestic consumption and to also support the organic farming sector. Romania has a huge organic farming potential, with 450,000 hectares certified for production and another 250,000 hectares of hayfields and 26,000 operators registered in this sector by end-2012. Romania ships 80 percent of the production, particularly raw material and little processed produce.
Unlocking the pig-meat exports in the European Union market and Bucharest's signing the export accords with China for cattle and pig meat and, in the future, for sheep will yield effects from 2014. The agriculture minister says Romania will be able to ship some 500,000 cattle and 4 - 5 million sheep to China, given that the animal stock has grown very much up to 14 million heads.
Romania, with around 15 million hectares of farm land and 10 million hectares of arable and cultivated land to date stands all chances to become an important grain market player not only in the Black Sea area but in Europe too, provided it improves the production yield, expands the storage capabilities, curbs its dependence on the environmental conditions and the agricultural produce is used to consolidate its position in the area.