The crisis is an opportunity for Croatia to change the paradigm how food coming from the rest of the world is better and cheaper than domestic products, and to strongly increase the use of domestic products.
The new – old President of the Croatian Chamber of Agriculture (CCA) Mladen Jakopović discovers for Diplomacy&Commerce that during his next term, he will focus most of his energy towards an even better organization of Croatian farmers, and that we are all fighting together through CCA for the interest of food production in Croatia. The goal is also to ensure better income, higher investments and production growth through European institutions.
- You will be at the head of the umbrella association of Croatian farmers for the next 4 years. What will be your priorities, and what will you pay special attention to?
Croatia is a member of the EU, and as of 2023 a new Common Agricultural Policy enters into force, and it brings a completely different concept – the policy is aimed at preserving the environment, increasing eco-production, reducing the use of protective means, while EU citizens are expected to continue to have sufficient quantities of food, and quality food at reasonable prices. Our farmers are facing a number of changes and new requirements that will be difficult to implement with a smaller budget from the EU, and we have also all been hit by this food crisis. First there was a global rise in food prices, and then the war in Ukraine, which caused panic and fear of shortages and interruptions in the supply chain. Since I am the Vice-President of the COPA COGECA umbrella association of EU’s farmers, we discuss every day how to react to this new situation. We believe that the war will stop quickly and that normal supply chains will be re-established. If that doesn’t happen, we must focus all our efforts on producing as much as possible, and the goal is to put agriculture in Croatia more clearly at the center of all policies, not just the Ministry of Agriculture, and to see what we produce in sufficient quantities, which areas are we self-sufficient in and how to provide enough food for our citizens, but also for export to EU countries that may be short of some raw materials or groceries. We are in extremely challenging times, and we recently sent a message that now is the time to sow every inch of available arable land in the EU. What I will ask for in Croatia is for increasingly more investments in the processing capacities, production of value-added products, so that our raw materials, by which I mean wheat, corn, soybeans and others, remain in the country and value-added products are produced from it. In addition, the goal will be to make it easier for farmers to invest in energy production, because that is also a way to ensure a better income. All this aims to preserve production and rural areas and to enable our young farmers to stay in the villages and start a new, more dynamic, digitalized development of agricultural production.
2. What would you single out as the biggest challenges that farmers in Croatia are faced with, and how is CCA helping them to resolve these issues?
At the moment, the biggest problem is how to do spring sowing with a huge increase in all input costs. Many farmers do not have the money to secure everything for sowing because prices have risen dramatically. It is important for us that this year’s sowing is in optimal terms, that investments are made in crop protection and to do everything necessary to have a good crop of cereals and oilseeds. Another thing they face is the problem in animal husbandry, especially in the production of milk and meat. Croatia has had negative trends in milk production for years and now it must stop and we must revitalize this sector so that it does not collapse completely. The biggest issue is the low purchase price, and high production costs, especially for the producers who don’t have their own land and are forced to buy fodder, and it is now at the highest historical levels. When it comes to meat production, Croatia has been under pressure for years to import meat of poorer quality and below production prices, which our producers could not compete with. We have constantly warned that the meat being imported is even falsely declared or labeled as domestic, and that it came from all over the world. This situation and the crisis can be an opportunity to increase our livestock and meat production, and above all to convince our consumers how important it is to buy domestic meat and domestic products. It is the only way to develop the economy and encourage investment and employment. CCA has 19 sectoral committees and discusses all issues within sectors, and negotiates with the Ministry on policies to be implemented. We manage to impose our views and changes in some decisions, and that is the purpose of the Chamber – to fight for the interests of farmers and consumers.
3. How would you rate your cooperation with the relevant Ministry and with decision-makers in general, and are they concerned about resolving issues and improving the position of farmers and agriculture itself in the country?
CCA’s cooperation with the Minister of Agriculture and her team is good, but it can and should always be better. What we always insist on is to have more of our members join the Commissions that make different decisions and I believe that we will be successful in this during my new mandate. Government of the Republic of Croatia has a growing interest in the problem of agriculture and is aware of all the negative trends, but we still demand that agriculture must be a strategic branch and that it should be discussed at least twice a year in the Government and Parliament of the Republic of Croatia. As I said at the beginning, we are a part of the EU and we are implementing the Common Agricultural Policy of the EU, and it has its own objectives that we have to fit into. At the end of last year, Croatia sent its Strategic Plan that states that after 2023, over 5 billion euros will be spent through the new CAP over the course of 5 years. We think that there is still room for improvement of that plan and for achieving the strategic goal, which is to increase the value of agricultural production from the current over 19 billion kuna to 30 billion kuna, which is the goal to achieve by 2030. What is crucial is to encourage young people to start farming. Croatia now has over 50 percent of farmers who are over 60 years old and they will retire very soon and someone needs to inherit them. It is generational renewal that we must all work on together. Both through the decisions of the Government and the Ministry, and through the media and the promotion of food production and agriculture as a profitable activity. Young people will be happy to go to the countryside and produce something, if they see that it pays off.
4. The war in Ukraine caused a crisis in food supplies in some markets. Many countries import additional reserves of wheat and oil, limit exports, consumption… What is the situation in Croatia? How much can we rely on domestic forces, how much do we import and do we have reasons to fear shortages?
We are certain that there will be no shortages in our country. Primarily because we produce sufficiently key raw materials like wheat, corn, oilseeds. We are a bit weaker when it comes to production of fruits and vegetables, but I believe that we can increase production there as well. What we lack are storage capacities and processing and that is why we have to invest. The Government is currently implementing several measures to ensure this. Fear of shortages had also emerged at the beginning of the corona crisis when there was a break in the supply chain globally, but this was quickly stopped. Finally, we are part of the common EU market and I believe that we can always provide enough food for the people of the EU. I don’t think we need to panic, but this is certainly an opportunity to seriously reconsider our policies on how to achieve greater food sovereignty and security and produce more. If I tell you that Croatia has a deficit of 1 billion euros in foreign food trade, then we must be aware that we have lulled ourselves into the availability of food on the global market. We have been exporting raw materials for wheat, corn, oilseeds for years, and we have imported bakery products, meat, fodder, etc. I think this is an opportunity to turn it around and make agriculture and food production the focus and allow it to become our strength, not our weakness.
5. What is being done to resolve the eventual increase in production and decrease dependence on import on the long run?
I already mentioned some things. First of all, we need to invest in processing and connecting our producers with processors and to produce more value-added food. Investments are crucial, but it is also important that farmers unite because now we have a problem that there are a lot of imported products on the shelves of retail chains, and there are fewer of ours. The reason is fragmented production and the fact that foreign traders protect their agriculture through shelves. Croatian products must be imposed and be on the shelf, available to domestic consumers, and this can only be achieved if they join forces in cooperatives or producer organizations. We also need our economic diplomacy to work harder to open up new markets and to see what we can offer to the world as a competitive product. For years, we have been recording a decline in almost all productions, except in farming, but in recent years we can see that we have more and more fruits, olives, different varieties of vegetables, we work on the promotion and export of prosciutto, for example, which is protected at EU level, etc. There are numerous opportunities, but we must learn how to cope with the market, and not expect the state to intervene at every problem. Excessive state interventionism is never a good thing and does not contribute to increasing competitiveness and productivity. And it is sufficient to say that Croatian agriculture is at 30 percent productivity from the leading agrarian EU countries. So we have to work harder, produce more and fight harder.
6. Which domestic manufacturers are most jeopardized by the war in Ukraine, and what are your suggestions for resolving potential crises with domestic manufacturers, processors, etc.?
Currently, livestock is under the greatest impact. It is necessary to invest the most energy, money, strength to start it and turn the trends. We are at about 50 percent self-sufficiency in milk production, and we have a similar situation with meat. Everyone agrees that the time of cheap food is behind us and that the time is coming when domestic, quality products will be highly valued and good prices will be achieved. That is why it is important to renew the livestock and to produce more, and then the prices for our consumers will be lower and more favorable. We are aware that there will be a large increase in prices in the coming years, so now we are looking for a change the paradigm where everything can be procured on the global market. We must rely on our own resources – and we do have them, and we must teach our consumers to buy from our farmers through short supply chains. That is the best and safest way to support them and ensure food security and sovereignty.