In the midst of a global food crisis, in which prices have reached record values, the European Union is trying to prevent the emergence of problems in the food supply.
While the EU is trying to counter this problem, many countries in Europe are facing rising prices.
The EU’s response to the world food crisis is to monitor the level of storage of agricultural crops in member states, relax environmental regulations to increase food production and find alternative delivery routes for Ukrainian grain exports, writes Agerpres, in an extensive analysis based on information published by international press agencies.
However, an unprecedented drought has given rise to concerns that crop yields in Europe will decline. This would further boost food prices, which have already risen substantially, one of the reasons being the war in Ukraine.
Despite the resumption of grain exports through Ukrainian Black Sea ports under a deal agreed by Russia and Ukraine and brokered by the UN and Turkey, concerns about grain exports remain. According to EU data, it is considered unlikely that the level recorded before the war, when up to five million tons of grain passed through Ukrainian ports every month, will be reached again in the near future. The first ship to leave the port of Odesa, in accordance with the terms of the agreement agreed by the UN, carried only 26,000 tons of corn. Finding alternative export routes remains crucial, a European Commission official said.
The European Commission has relaxed regulations in the field of agriculture to increase food production
In the context of imminent food supply problems, the European Commission has decided to relax the regulations previously imposed on farmers in order to facilitate greater food production. The commission proposed a one-year exemption from crop rotation rules and the obligation to convert arable land to fallow. The reform of the EU’s agricultural policy, which will come into force in 2023, has led to stricter environmental standards for agriculture. These include requirements for farmers to protect the soil by not growing the same crops on the same land for several years in a row.
However, there have been increased calls for these environmental protection standards to be relaxed, with the idea that more grain could be produced, given the reduced quantities that can be transported from Ukrainian ports affected by the war. Every ton of grain produced in the EU will help increase global food security, the Commission announced.
Romania will not limit wheat exports
By August 3, Romania finished harvesting wheat from 94% of the cultivated area. The Minister of Agriculture, Petre Daea, assured that this year’s production will cover the country’s needs and leave room for exports. Although Romania announced that it will not limit wheat exports, Petre Daea emphasized that the needs of the domestic market will be covered first and only the remaining quantities will be exported.
On August 10, 284,376 hectares of Romania’s surface were affected by drought. Of the total affected area, 154,500 hectares are cultivated with wheat and triticale, 22,598 hectares with barley, sorghum, oats, rye, 25,000 hectares with rapeseed, 49,910 hectares with corn, 3,141 hectares with soybeans, 702 hectares with peas, 20,054 hectares with sunflowers. , 3,952 hectares with forage plants and 4,427 hectares with other crops.
However, Romania is not exempt from the increase in food prices. Starting from July 2021, cooking oil recorded the highest price increases, 49.71%, while potato prices increased by 42.18% and flour prices by 33.16%. The authorities in Bucharest have adopted several measures to protect those affected by price increases with meal vouchers and other forms of government aid.
Germany and Austria took advantage of the Commission’s relaxations
Austria has agreed to the European Commission’s proposal to extend the use of fallow land for agricultural production until the end of 2023. At the same time, the German Minister of Agriculture, Cem Ozdemir came up with a proposal to allow farmers to use a larger part of the land them to grow grain, considering the deficit that exists on the world market. Berlin is going to suspend, for one year, the new EU regulations on crop rotation. While parliamentarians and farmers’ associations welcomed this proposal, the environmental NGO Greenpeace strongly criticized the Minister of Agriculture for bowing to pressure from the agricultural lobby.
France: Disaster for farmers, ecosystems and biodiversity
Faced with a “historic” drought, aggravated by a third extreme heat wave, the French Government activated a crisis cell on August 5 to coordinate efforts to mitigate the impact. “This drought is the most severe that our country has faced,” Prime Minister Elisabeth Borne informed in a press release. The dry conditions are a “disaster” for French farmers as well as for “our ecosystems and biodiversity”, added Elisabeth Borne.
Restrictions on water consumption have already been introduced in almost all 96 departments in continental France, with 73 of them at the highest level of alert. However, the Government’s statement did not respond to the growing criticism of the exemptions that have been granted for golf courses. The owners of these lands are allowed to continue to water them, even in the regions facing the most severe drought.
Several European countries have also issued severe drought warnings, and the EU has urged member states to reuse treated wastewater to irrigate farmland.
Inflation continues to rise in Spain
In Spain, consumers continue to be severely affected by the increase in food prices. These were triggered in the first phase by the pandemic, then by the increase in electricity and fuel prices, which led to protests and strikes in the agricultural sector, and finally by the war in Ukraine. In July, the Organization of Consumers and Users of Spain (OCU) already sounded the alarm about a 15.2% annual increase in the cost of a basket of basic products. This significant increase affects low-income households in particular. In June, the price for a melon reached a record level of 13 euros. According to the National Institute of Statistics (INE), the consumer price index increased by 1.9% in June, and the annual rate of inflation increased by 1.5 points, up to 10.2%, the highest level of after April 1985.
The Spanish Minister of Agriculture, Luis Planas wants the world food markets to be more transparent in order to be able to reach a stabilization of prices. “Greater transparency can and must be given to the markets”, the minister emphasized, citing as an example the recent decision of the EU countries to notify the Commission about the level of their stocks of cereals, rice and oilseeds. The Spanish official also referred to the Agricultural Market Information System (AMIS) platform developed by the G20 states as a useful tool to increase transparency on the food market. Planas asked for support for the most vulnerable countries that need to buy grain.
Food prices have increased by over 23% in Bosnia
Bosnia-Herzegovina is facing an inflation rate of 15.8%, and the prices of food and soft drinks have increased by 23.4%. The country relies mainly on imported food and has insufficient reserves to intervene significantly in the market. Traders frequently take advantage of their monopoly position to keep prices artificially high. Due to the large number of tourists and the fact that the population from the diaspora returns to the country in the summer months, the current demand for products is quite high.
Economists expect the start of fall to bring a slowdown in demand, which will force retailers to cut prices on many food products. Comparative data shows that, despite price increases for many basic products, prices in Bosnia and Herzegovina are still lower than in neighboring countries.
The inflation rate reached a record level of 16% in North Macedonia
According to the Federation of Trade Unions of Macedonia (SSM), current inflation significantly reduces purchasing power. The purchasing power of the monthly minimum wage has fallen from 290 euros to 244 euros, while the purchasing power of an average salary is currently 428 euros, instead of 510 euros.
North Macedonia depends on imports for a number of basic foodstuffs such as wheat, cooking oil, meat and milk. According to SSM calculations, the minimum expenses for a family amounted to approximately 760 euros in July. But the level of income is not enough for families with two employees if one earns the average wage and the other the minimum wage in the economy.
Croatia: prices did not decrease in stores despite the reduction in VAT rates
Following the example of other EU states, Croatia reduced the VAT rates on energy, sanitary products and food products in an attempt to lessen the impact of the high prices currently recorded. Starting from April 1, the VAT rates for energy and sanitary and food products were reduced from 25%, respectively 13% to 5%. The Croatian Consumer Protection Association (HUZP) has repeatedly asked the State Inspectorate to carry out controls on food prices, because, despite expectations, there have been no price drops.
However, as in other EU member states, a large amount of food is wasted in Croatia. On average, Croatians throw away about 71 kilograms of food per capita every year, a total of 280,000 tons, and 76% of this amount comes from households, while in the EU the average is 53%, Branka said Ilakovac, president of the Center for the Prevention of Food Waste in Croatia (CEPOH). According to her, prevention and education of citizens were not recognized in Croatia as crucial factors in contracting food waste.
According to estimates, citizens of EU countries throw away 88 million tons of food annually, with a total value of 143 billion euros, claims Branka Ilakovac. She added that as an EU member country, Croatia has set a target of reducing food waste by 50% by 2030.