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45% lower wheat production in Serbia and Montenegro
With almost 90 percent of the crop harvested, recent estimates of wheat production in Serbia in MY 2005/06 indicate that production will be significantly lower than the previous year. Total wheat production is estimated to be around 1.5 million MT, 45 percent lower than the crop in MY 2004/05. This drastic reduction in production was mostly due to late seed planting, adverse weather conditions during the growing season and heavy rainfalls in July that hampered wheat harvest. Analysts project that total area harvested will be around 540,000 HA and the average yield in Serbia will be around 3.5 MT/HA, with yields varying significantly from one region to another. It is reported that yield could be as low as 1.5 MT/HA in some of the areas affected by the April 2005 flood in the Banat region, while in other high productivity areas such as North Backa and Central Serbia the yield could reach 7 MT/HA.

This year’s crop, together with 500,000 MT wheat stocks from last year’s crop, should be sufficient for Serbia’s domestic consumption, estimated at 1.8 million MT annually. Serbia would probably have to import some 100-150,000 MT of high quality wheat in order to improve the baking quality of the local wheat stocks.
Preliminary quality reports indicate that wheat quality in general is satisfactory, with the Hagberg between 250 and 300 and TW around 90. Some areas have reported high moisture contents due to heavy rains during harvest. However, the bug damage that deteriorated last year’s crop seems to be much less of a problem this year.

In mid July, the government of Serbia reversed its year-old policy of no intervention in the production and marketing of the wheat crop.
Since the beginning of the planting season and throughout the growing season the government did not provide any production subsidies or price support to wheat farmers, unlike the case with sunflower seeds and soybeans. However, following the heavy rains during harvest and after it realized that the wheat crop would be very small and local market prices would be low the Serbian government decided to intervene with some measures to help wheat farmers. On July 14, the Ministry of Agriculture announced several measures to help registered wheat farmers including production subsidies and storage support for this year crop as well as providing commercial loans with preferable interest rates for wheat planting next season.

Starting September 1, 2005, registered wheat producers could receive 5,000 dinars per hectare of wheat planted in MY 2005/06. According to the Ministry of Agriculture, there are 15,000 registered wheat producers holding 231,000 HA, about 40 percent of total area planted to wheat. Serbian wheat producers will also receive 750 dinars per ton, with a maximum of 4 tons/HA, as reimbursement for storage costs. In addition, the Serbian Ministry of Agriculture announced its plan to help registered farmers get commercial loans of 12,000 dinars per hectare with preferable terms of 6 months at an annual interest rate of 5 percent. These measures to support wheat farmers are estimated to cost the Serbian government about 1 billion dinars ($15 million), an amount that has been previously set aside in the 2005/06 agricultural budget.
MGR Archive 4.8.2005
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Region Type Price  
Russia Rapan $ 700
USA Jupiter Rice $630
USA Calrose #1 $830
USA Calrose #1 Paddy $480
EU Prices Baldo €660
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