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Poor fruit harvest will take its toll

Ravages of season prompt growers to seek protection

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

KURT VINION/THE PRAGUE POST
Czech apples are hard to come by this year.
Around this time every year, fruit farmers get ready for the highlight of their season, the harvest.
This year, however, they are preparing for a different thing: counting their losses.
A bad fruit harvest is putting pressure on growers, who say they have little protection from losses during poor growing seasons, and has prompted some to seek better safeguards.
Unexpected frost in late April and in early May, later followed by heavy rain and hailstorms, will significantly decrease this year’s yield. The amount of the most common domestic fruit, apples, will drop more than a third, according to the Czech Fruit Growers Union. Since apples represent about 80 percent of total domestic fruit production, the drop will negatively affect the whole sector.
“This year’s harvest will be the smallest in the past 12 years,” said the union’s secretary, Martin Ludvík. “The worse yield is likely to lower fruit farmers’ profits some 400 million Kč [$18.7 million].”
Under usual circumstances, fruit growers annually reach total profits of 1.2 billion Kč. The decrease in production will take a toll on farmers and consumers alike, Ludvík said.
“Farmers in the most affected regions could seriously struggle this year,” Ludvík said. “Also, fewer apples on the market will push prices up some 20 percent.”
Typically, local farmers provide 60 percent of apples on the domestic market, while the remaining 40 percent is imported from abroad. Due to this spring’s unfavorable weather conditions, however, local growers will only be able to deliver about 40 percent of the market, shifting the balance toward imports.
Nevertheless, Ludvík is not worried foreign imports will pose a threat to locals.
“Our biggest competitors are the Poles, and they’re struggling like we are,” he said, adding that apples will be imported from Italy and South America.
“The price of apples will be higher, so our farmers will be able to push them from the market again next year,” Ludvík speculated.
Looking to Brussels
Following European Union regulations, fruit farmers can’t receive financial compensation from national governments, according to Agriculture Minister Petr Gandalovič. To make matters worse, fruit farmers cannot seek prevention in commercial insurance policies.
“The thing is that no insurer here provides insurance against frost,” Ludvík lamented. “So we actually have no tool for protecting ourselves against similar losses in the future.”
Farmers are determined to initiate the launch of a special fund that could provide some compensation for future low yields.
“Farmers would make payments into this fund, and other contributions would then flow in from state coffers and EU funds,” Ludvík said.
Gandalovič said such a fund could indeed be launched. However, he clarified that this is unlikely before the fall, when the issue is set to be discussed in Brussels.
“EU agriculture ministers will discuss a reform of subsidizing the fruit industry and how to support crisis management in this sector,” he said.
Subsidies to fruit growers from EU funds currently depend on the actual volume of production. After such a reform, subsidies should be derived from the size of orchards. Today, domestic fruit farmers receive an average of 1,000 Kč per hectare of farmland. The EU average is 12,000 Kč. The reason, Ludvík explained, is that the EU tends to prefer subsidizing tropical fruits such as bananas or lemons more than typical Czech fruit such as red currants or cherries.
“We’ll lobby in a way that EU subsidies depend on the size of [farmland] and not on the amount or sort of production,” Ludvík said.

František Bouc can be reached at fbouc@praguepost.com


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