The 500 candles that saved the produce, but not the farmer

Author: Alfred Zylyftari, Elsa Kotorri

On a cold February night, a farmer and his wife spent the night in the greenhouse lighting 500 candles at the roots of the seedlings to maintain the temperature so that the seedlings would not be damaged and the effort would not go in vain.

The seedlings were received free of charge with the promise that they would be paid after the sale of the produce. Now that the time has come to sell, their fear is at what price they will sell the products? Will they come out this year with a profit or a loss?

This is one of the stories of farmers in the Lushnja area. What they have in common is the “fear” they have of the collection points. Out of this fear, even those who agree to speak, do not want to be identified.

This was the panorama of the countless farms in Lushnje that ACQJ found at the beginning of February 2021. Farmers who by makeshift measures tried to plant, grow and guarantee the harvest of their products in the greenhouses managed by their families. The ACQJ also visited the region in August, a month during which all crops were supposed to have already been harvested and sold, and farmers had the opportunity to enjoy the fruits of their hard work throughout the growing season. But nothing had changed.

Asked by journalists, the same farmers say that despite the expectations, even this year, they remained dissatisfied with the subsidies they have received from the state. A farmer says that he received only 20,000 lek for a greenhouse raincoat for two acres of land, stating that “If I had known I would get so little, I would not have applied at all. I spent half of the money I had on the documentation I needed to apply.”

The greenhouse products he sold in the first season, he sold them all in the domestic market, but at the price set by the traders. He says that the prices of chemical fertilizers have increased compared to last year. “Even the agronomists of the municipality do not visit our greenhouses in the field to see the products and to see the possible problems.”Everything is done in the office with paperwork, or it is not done at all.” he says, while one of his fellow villagers says that this season he has not sold at export points due to bureaucracies and price-fixing tricks.

Wholesale points dictate the value of food products

Through the IPARD Program, the Lushnja area has opened some of the largest collection points of agricultural products in Albania. In a Facebook post in June this year, Prime Minister Rama advertised the achievements in this field, expressing the aspiration for even greater achievements. The collection points of agricultural products “Doni Fruits”, “Elian” and “Pula Comerc” in Lushnja are a private initiative, but are also supported through the IPARD program. According to state sources, these investments have had a high impact on increasing the agricultural production of the area, increasing exports and generating income for the inhabitants of this area. According to INSTAT statistics, exports of food, beverages and tobacco, of which agricultural exports are a part, for the first six months of the year were a total of 21,359,000,000 Lekë, but the real profits of farmers in Lushnja are extremely limited by the difficulties in growing the produce, and the prices benign set by the collection points.

When addressing the collection points of farmers’ products, the latter express that they feel powerless towards the traders, as they have only two ways; either to sell their goods at the price set by the trader or to be forced to dump the produce in the field. The power of these produce collection points comes from the monopoly situation. In Lushnja there are few collection points for export.

“They expect the domestic market of Divjaka to be overcrowded in order to lower prices,” said one of the farmers in Këmishtja.

The farmer cannot sell all the produce in the domestic market, while the export points receive all the produce at once, but at the price dictated by the wholesale points.

“I was forced to sell 700 kilograms of tomatoes at the wholesale point for only 7000 lek. In other words, 10 lek per kilogram “- says a farmer. In the retail market the price was 140-180 Lekë, a very large difference from which only collectors and wholesalers earn according to the farmers themselves.

Asked about the problems that arise for farmers trying to sell their products near agricultural collection points, Dr. Rezart Prifti, lecturer at the Faculty of Economics and co-author of one of the most wholistic publications on the agricultural economy in Albania and the problems faced by Albanian farmers, says that “It is true that farmers often do not have the power to dictate the price of the product and this causes problems to them, as long as they are forced to sell it below cost, not to throw it on the field. But we must bear in mind that, in Albania, there is a lack of optimization of the production processes, as in most cases we are far behind in technology with regards to agricultural products, and as a result we have a product for domestic use or export of a very low standard.”

He further states that the sale of the product to the wholesaler is a commercial negotiation. “You can not set the price of the product according to your wishes or need if you do not follow the instructions of quality or quantity of the required product; do not comply with the quality conditions of the required product; or do not adhere to the limits on the use of pesticides in the product. Most collectors of agricultural products are exporters to some of the largest European trade chains and beyond. We can not expect the wholesaler in Albania to accept the product below the set standards, and then this product to be accepted by the main customer. Both sides have their faults here, but we must be careful to not always blame the collection points.” – he says.

Subsidies, easily found on paper, but practically unprofitable

By reading the information on the website of the Ministry of Rural Development and ADRA, information on potential subsidies for farmers, simple procedures according to the Ministry, are a nightmare for anyone trying to get a fund for further development of the farm or its greenhouses .

“It seems that these criteria have been set so that state subsidies are not obtained by small farmers,” said an agricultural expert familiar with the problem.

Farmers, especially those who have greenhouses and do not use a lot of agricultural tools, suggest the model of subsidy that is done in Northern Macedonia: the subsidy should be given on the basis of the amount they produce, and not fixed as it is done here.

“Subsidies provided by the state, except that they are not enough, nor are they categorized according to the needs of farmers.” – says Andrea Muҫo, expert of the Center for Transfer of Agricultural Technologies Lushnje.

The procedure of obtaining a subsidy for farmers is itself a real hell in terms of the necessary steps and paperwork. “The initial application is made at the district agriculture offices. Once the application file is completed, you must submit it to the Commission for the Acceptance and Evaluation of Applications, which checks the file and enters the data into the system. It then proceeds with the evaluation of the application, which is supposed to be done automatically by the system, followed by an administrative check and field verification, and finally, if you are lucky, then the approval of the file and the authorization of payments is done, not to mention their execution , who knows when it is done. ” says a farmer.

Another farmer asks: “I have a greenhouse. Why do I need a fuel subsidy? Where to use it?”

The Center for the Transfer of Agricultural Technologies is powerless to come to the aid of Lushnja farmers after half of their competencies have been removed. Scientific research has been delegated to the Agricultural University of Tirana. As a result, the budget and human resources of this institution have been reduced, leaving access only to the experimentation of seeds of different agricultural crops and the development of fairs.

The problem of farmers, says Muço, is not the “wrong” choice of agricultural crops to be cultivated. The problems come later: the inability to sell production, the lack of subsidies, the difference in cost and profit.

From the criteria set for the fuel subsidy, a farmer must have not less than 1 hectare of land and not less than 10 certificates of ownership in total. So a certificate of ownership must have not less than 1000 m2 to meet the criteria even though the farmer has these 1 hectares of land, but the certificates are less than 1000m2.

“Over the years, we have noticed that one of the main problems in subsidizing farmers has been the illegality and non-translation of various schemes in production or trade efficiency. The current ADRA scheme, funded by international partners, intimidated by previous experiences but also pushed by strict EU funding conditions, has found that the only way to overcome these difficulties is through strict and often incomprehensible bureaucratic procedures. Impossible o be understood even by me, let alone a farmer from Lushnja or Fier. Beyond conditions on the amount of land, livestock heads or documentation, the cost of getting involved in these financing schemes is often unaffordable for a farmer due to the documentation required itself and the many steps to follow. At a time when the cost of providing the service is greater than the grant received, everyone is reluctant to apply, let alone talk about efficiency.” – says Prifti.

Albania is still one step behind in the agricultural sector in terms of subsidy policies, as well as in technology and quality of production due to lack of knowledge of non-native agricultural crops, lack of experience and foreign trade during the communist regime.

In Lushnja there are also farmers who have been trained and certified abroad, but feel powerless to implement their knowledge due to the chain: production-collection-sale.

“At least the state should intervene in setting the floor and ceiling prices so that the farmer has a certainty that his production will not come below cost,” says Muço

“This policy would protect not only the farmer but also the consumer from the abuse with prices by wholesalers, who buy goods at a relatively low price and sell them at a much higher one.”

Retail traders also complain about the high prices of agricultural products.

In the retail markets, it is noticed that for certain products, the imported ones dominate, while the Albanian farmers sell the same products at a low price or are forced to throw them away.

“It is “ok” that the state does not help us, but why does it not favor us over foreign products? Why should the tomato come from outside when we throw it here? ” says an angry farmer.

According to the expert, this situation occurs because the state is more favorable to imported products than domestic production.

Financing farmers is seen as one of the biggest challenges even for Prifti, who says that “If we want to see effective grant schemes, just remove the mediator. Take away the countless agencies and visit the farmer, go see what he needs and finance him directly, without complicated schemes, without countless documentation and without unattainable conditions dictated by a problematic history in the management of small and medium grants for agriculture.”

In the request for information that we sent to the Ministry of Agriculture, we received a response that the import-export rules are set by the market. We also tried to contact the former Minister of Agriculture, Mr. Edmond Panariti, since the strengthening of collection points became a policy of the Ministry of Agriculture in his time, but he did not wish to respond.

In the face of such a situation, farmers do not find support even from trade unions and agricultural organizations, as according to them the latter have become one with the most powerful parties (traders).

The only hope of the farmer from Këmishtaj who saved the seedlings three months ago by lighting candles in the greenhouse, is to sell the produce at a price that at least does not come out at a loss.

This fear of farmers will be quenched if there will be greater control over wholesale points and at least setting a floor price.

“At least let’s do what is done in Macedonia,” says one farmer.

Economist Prifti, seeing the current situation says that the main problem observed in Albania is the lack of adaptation to world economies and market demands, and as a result of the failure of farmers to benefit from the application of economies of scale, not only for belongs to the economic element, but also in order to turn themselves into a competitive factor in the market. “The word “cooperative” has a black mark on the subconcious of Albanians, but what we in the report prepared for FES in 2016, propose is a different term and approach: Initiatives of entrepreneurial farmers, which again is essentially a union of strength among small farmers to adapt to market demands, but with more contemporary elements.”

For now, farmers remain underrepresented, with ill fitting financial support schemes for small producers and a market they find difficult to adapt to, both in terms of production quality and quantity, leaving the fate of their products to the wholesalers. Adapting to international standards is not easy, but also the intervention of a commanded production process according to the requirements of buyers and cooperation between farmers to benefit from the concept of economies of scale, are seen as two of the only effective ways out of the current hopeless situation.

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