The increase in animal feed prices from ten to 40 percent directly threatens agricultural producers, especially milk and meat, it was assessed at the session of the Board of the Association of Agriculture and Food Industry of the Chamber of Commerce (PKCG).
The board considered the Information on economic trends in agriculture for the period from January to April and the realization of public calls through IPARD.
The PKCG announced that proposals for solving current problems in agriculture were formulated at the session, among other things, to ensure the purchase of surplus agricultural products, especially goat cheese and fishery and aquaculture products, through a market intervention program.
"Due to the increase in animal feed prices, it is necessary to consider the possibility of introducing a subsidy until the market stabilizes, since in recent months the animal feed price has increased by up to 40 percent in certain categories," the announcement states.
Members of the Board of the association also believe that it is necessary to continue with the implementation of the Buy Domestic and Domestic Flavors projects, with the aim of strengthening the awareness of domestic consumers and tourists about the usefulness of buying domestic products.
"It is necessary to amend the Law on Value Added Tax (VAT), which will introduce a single lower VAT rate for a certain number of products intended for food," said the PKCG.
It was also assessed that it is necessary to work on the association of producers, which will enable them to perform together on the market and thereby strengthen their competitiveness.
The secretary of the Board, Lidija Rmuš, said that during the first four months of this year, the operations of business entities in the field of agriculture were greatly influenced by the pandemic.
"In the first quarter of this year, the total processing industry achieved a decline of 13,1 percent compared to the same period last year, while the beverage industry saw growth of 4,7 percent, the tobacco industry seven percent, and the food industry 3,3 percent." , specified Rmuš.
Although there was no stoppage in production during the pandemic, as she stated, the producers faced the problem of product placement, both due to large imports and slower collection, and partly due to insufficient demand on the market, they had to reduce production and reduce the range to only basic products.
This year, prices on the animal feed market have increased by ten to 40 percent, which directly threatens agricultural producers, especially milk and meat producers.
"As the Agricultural Budget has not yet been adopted, it makes the situation even more difficult, because agricultural producers do not yet know what subsidies will be available and when public calls for support measures will be announced, especially for crop production measures," says Rmuš.
Rmuš said that at the same time it is necessary to provide assistance to dairies that buy milk and already have a problem where to sell or store finished products.
As for goat's milk, there was a general decrease in purchases, precisely because of the impossibility of selling cheese, because the two cheese factories that purchase milk reduced, that is, completely canceled, purchases from producers.
This situation, as assessed by Rmuš, requires urgent intervention through the Market Intervention Program.
The President of the Board, Milutin Đuranović, said that Montenegro is a tourist country, since that branch contributes 25 to 30 percent to the gross domestic product (GDP).
"All sectors are related to tourism, including agriculture. I believe that this is a year of recovery, through tourism," Đuranović assessed.
He announced that the state should allocate more funds to support agricultural production, stating that investments in this sector do not represent an expense, but a valuable investment that produces significant results.
The representative of Zrnožit, Branko Pejović, emphasized the importance of association of producers in clusters and planned production in agriculture in accordance with market requirements.
"The problem is not to produce, but to market the products. If we don't have a market, there is no placement," said Pejović.
Božidar Jokić from the company Agro Mont considers the introduction of a lower VAT rate for egg producers very positive.
He believes that the development of agriculture is impossible without state support, through subsidies.
Safet Franca from Mesopromet pointed out the problem of taxing white cheese at a rate of 21 percent, which represents significant expenses for buyers.
"It is necessary to initiate according to the Ministry to reduce this VAT because we are uncompetitive, since sellers on the market and buyers do not pay this tax at all," Franca said.
This company buys cheese from 250 subcontractors, but it has to calculate VAT, which is not the case when selling cheese on the market.
The representative of the relevant Ministry, Mirsad Spahić, said that there are numerous challenges in the sector, and some of them, such as the purchase of milk, cheese and lambs, should be solved through strategic action in order to avoid the creation of market surpluses.
He added that he had noted the demands of businessmen and that work would be done to resolve them.
Spasoje Vujošević from the Investment and Development Fund (IRF) said that for this year they have defined credit lines to support higher education students, technological surpluses, women, beginners in business, female entrepreneurship, women and young people in business.
He announced support for companies in maintaining and improving liquidity, encouraging competitiveness, realizing green and brown field investments, and infrastructure projects of environmental, local and state importance and those in the field of energy and energy efficiency.
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