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Pig farmers take their case to the public

Cheap imports give pork producers bankruptcy worries

By František Bouc
Staff Writer, The Prague Post
April 4th, 2007 issue

KURT VINION/THE PRAGUE POST
Czech pork farmers say cheap imported meat sold by chain stores and hypermarkets could drive them out of business.
Drivers passing through Dolní Dvořiště, south Bohemia, were stunned to see 200 farmers from all over the Czech Republic giving out sausages and hams March 26 while waving banners and distributing leaflets at the Austrian border crossing.
It may well be the last time local farmers show their best side to the public.
Source: Czech Agricultural Association
Pork prices
Soon, they could be blocking the borders instead, or pouring waste onto the streets of Prague.
Farmers are desperate to raise consumer awareness about increasing pork imports they worry are putting their business in jeopardy.
“Nowadays, our farmers and pig breeders are going through the worst crisis ever,” Agrarian Chamber (AK) President Jan Veleba says. “They’ve got the feeling they are virtually unwanted in their own country.”
The spike in inexpensive quality imported pork, exceeding exports by 1 billion Kč ($47.5 million) in 2003, has many farmers worrying about bankruptcy scenarios. And the deficit rose further to 4.6 billion Kč last year.
The trade balance is likely to further deteriorate following the recent announcement from Austrian grocery chain Interspar, with 24 Czech hypermarkets, that it is switching to Austrian pork because of the bankruptcy of Czech supplier Prima Group.
“Unfortunately, Czech meat processors were unable to supply pork in adequate volumes and also quality,” Interspar country manager Martin Hruška says.
Similarly, Tesco imports up to half its meat for Czech shoppers while Ahold also supplies its local stores with imported products and opened a meat packaging plant in Kraków, Poland, in August.
Veleba says such imports reduce Czech meat sales by 37,000 metric tons (41,000 short tons) per year and reduce local farmers’ income by 2.4 billion Kč annually.
No government aid
The chamber is seeking state help in the form of import barriers and a media campaign to convince consumers to insist on Czech products.
Agriculture Minister Petr Gandalovič says the Czech Republic, as part of the single European market, can hardly erect barriers to free trade.
“I’m not excited about the increasing meat imports and that retail chains tend to prefer meat from abroad to Czech meat,” he says, “but there’s not much that can be done about it. The only thing we can do is to check whether the meat that is sold complies with all regulations, whether it carries all certificates that it should have.”
Gandalovič adds that the state already supports the marketing of Czech food products via certificates such as klasa, which guarantees top quality and local sources, spending more than 200 million Kč per year on the program.
The Agrarian Chamber also turned to the Anti-Monopoly Office (ÚOHS) for help in February, arguing that Interspar abused its dominant position on the market by turning down Czech meat supplies. Furthermore, the complaint alleges, Czech meat suppliers can get their products on local shelves only by selling at prices lower than production costs.
“The discrimination is apparent,” Veleba says, “because, while there are thousands of farmers, there are only hundreds of food dealers and then no more than just 10–12 retail chains that can virtually dictate conditions to suppliers.”
ÚOHS chairman Martin Pecina turned down the chamber’s complaint, however, insisting that no food chain in the Czech Republic enjoys a dominant position.
Interspar’s Hruška, meanwhile, denies that hypermarkets are only willing to pay prices that undercut local suppliers’ costs.
“We do care about making profit,” he says, “but we also care about the quality of our products. We’re not discount retailers.”
But, Veleba says, if state authorities ignore farmers’ call for help, they will indeed be making future protests more radical.

František Bouc can be reached at fbouc@praguepost.com


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