By Vesna Peric Zimonjic
BELGRADE, Sep 19 2007 (IPS)

As rain falls and autumn approaches, countries across the Balkans are taking stock of the damage caused by one of the hottest summers in recent times, with temperatures in the 40s since mid-June until the beginning of September.

The summer brought unprecedented drought to Bosnia-Herzegovina, Croatia, and Serbia, all highly dependant on agriculture.

In an immediate consequence of diminished production due to the heat, prices of flour, bread, meat and cooking oil have risen sharply, up to 50 percent.

“Something should finally be done so we don’t look into the skies that should bless our crops,” Ratko Marjanovic (62) from Staro Mirijevo village on the outskirts of Belgrade told IPS. “That is what my grandfather did, but we live in the 21st century, don’t we?”

Like many farmers in his village, who grow vegetables to sell to capital Belgrade, Marjanovic is considering buying a sprinkler system for his fields. “It will cost several thousand euros, but it is nothing when I count what I lost due to the drought.”

The Serbian agriculture ministry has calculated the damage to crops from the drought at 494 million dollars. Agricultural produce makes almost 20 percent of exports from Serbia. The most wanted produce abroad are maize, grain and fruit, particularly berries.

“Our crop exports are rising 20 percent each year, making agriculture the healthiest part of the Serbian economy,” agriculture minister Slobodan Milosavljevic said at a press conference. “We expect this year’s exports to reach more than 1.5 billion dollars.”

But this is uncertain if the harvest is at least a quarter smaller than normal, as it is expected to be, particularly for maize, grain, sunflower and soy.

Farmers say little was done to help them. In Serbia, as in neighbouring Croatia, irrigation is discussed only after severe droughts, which have been occurring once in three to five years.

“Only 1.2 percent of 3.2 million hectares of arable land is being irrigated in Serbia,” Branislav Gulan from the Serbian Chamber of Commerce told IPS. “That is 15 times less than the average at the global level.”

Gulan and other officials say that unspecified funds from the recently introduced National Investment Plan, and available 47.8 million dollars of World Bank credit should be used to start irrigation projects in Serbia.

There is a similar need in neighbouring Croatia, where crop losses due to drought are estimated to the extent of 260 million dollars.

Croatian agriculture ministry statistics say that around 100,000 farmers families face huge losses. The drought did not affect just the crops; it killed cattle and endangered fisheries. Many farmers had taken short-term credit to boost production, which failed.

“Both we and cattle will be hungry this autumn and winter,” Franjo Odobasic, a farmer from the central town of Pozega told Croatian Radio Television (HRT). “The price of scarce maize has doubled in the past two months, and we no longer can afford to buy it.”

Bosnia-Herzegovina is in a particularly odd situation. The country, divided into two entities, the Bosnian Serb Republic of Srpska and the Croat-Muslim Federation, never stimulated agriculture production.

For both parts of Bosnia-Herzegovina it was easier to import 350,000 to 450,000 tonnes of grain and maize for local needs each year than to invest in production. Federal ministry of agriculture statistics say that local production covers only 10 percent of the needs of the four million population.

Due to the complicated administrative structure, no common reserves were created, and the country now needs urgent imports.

Federal minister for agriculture Damir Ljubic told Sarajevo media that “there are no reserves to intervene in the market and prevent price hikes.” He declined to say when urgent purchases will be made.

In the northern town Brcko, low reserves of grain and flour have led to a 50 percent hike in bread prices.

“But despite the fact that drought affected all, some have profited from it,” says economist Natalija Bogdanov from Novi Sad University in northern Serbia.

“This mostly goes for monopolists, those who still tend to control the market, when they buy at the lowest and sell at the highest price. We have still not come out of that circle, despite all the attempts to introduce real market economy,” Bogdanov wrote on the Ekonomist weekly.

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