September 1, 2008

 

Romania expects 2008 wheat harvest of 7.7 million tonnes

   

 

Romania's wheat harvest should amount to 7.7 million tonnes this year, compared with barely 3.0 million tonnes in 2007, Agriculture Minister Dacian Ciolos said Friday (August 29).

 

"I'm optimistic with regard to 2008," Ciolos told AFP in an interview.

 

Total cereal production was expected to amount to 3.5 tonnes a hectare, thanks to the favourable weather conditions, he said.

 

Romania's agricultural sector was hit by the worst drought in 50 years last year, when output plunged by half, weighing down the country's overall economic growth.

 

"In 2008, the agricultural sector will certainly add to growth," the minister said. In the first six months of 2008, Romania's gross domestic product expanded by a record 8.6 percent.

 

The robust performance is expected to lead "stabilization" in food prices and that could lead to a slowdown in inflation, the minister said.

 

Nevertheless, farmers themselves wouldn't benefit as much from the upturn as the wholesalers, Ciolos said.

 

"The Romanian market is not as well organized as, say, the French market, and farmers frequently have to choose between selling on the black market or be content with rather modest prices," he said.

 

In addition, farmers faced a number of difficult new challenges when Romania joined the European Union in January 2007, including the abolition of import barriers for agricultural products, stricter EU guidelines and changes in subsidies.

 

Bucharest is set to receive some EUR13 billion in EU agricultural and rural development subsidies up until 2013, but not much of the money will find its way to many of Romania's 4.3 million farms because their holdings of land are too small.

 

Ciolos called for changes in the tax system, "which currently disadvantages farmers", as well as state investment.

 

The EU said in July that it was freezing EUR28 million in agricultural aid to Romania owing to "technical deficiencies" in the way the money was distributed.

 

Ciolos said Romanian experts were currently putting the finishing touches to the system, in line with the EU Commission's recommendations.

 

That would allow subsidy payments to be resumed but Ciolos refused to give an exact date.