Miller Magazine Issue 107 / November 2018

ROMANIA 88 MILLER / NOVEMBER 2018 As an EU member state, Romania offers a sizable domes- tic market and a comparatively low-cost foothold for acces- sing the entire EU market. The country’s location in Sout- heast Europe, bordering on the Black Sea, provides a view beyond Europe and shortens the distance for export sales to Turkey, the Balkans, the Middle East, Ukraine and Moldova. Romania is a market with excellent potential, a stra- tegic location, and a favorable business climate. Its eco- nomy is among the EU’s fastest growing; 4.8% growth in 2016 and 6.9% growth in 2017 (the highest since 2008). Romania is a traditional agricultural country and plays a unique and important part in European agriculture. The soil is fertile and the climate is favorable for agricultu- re, animal husbandry and horticulture. With a total area of 238,000 sqm, Romania is one of the countries of the most pronounced agrarian profile in the European Union. Having about 15 million ha of farmland, of which more than 9 million ha devoted to arable crops, Romania owns almost 1/3rd of the total agricultural land in the EU. Both crop production and animal production in Roma- nia follow an upgrowing trend. Main locally produced agriculture products are wheat, corn, barley, sugar beets, sunflower seed, potatoes, grapes, pork, poultry, milk, wool and eggs. The contribution of agriculture to the GDP formation in Romania fluctuates between 4% - 6%, as agricultural production is highly dependent on weather conditions, the sector counting over 25% of the working population, figures which are high above the EU average. The agricultural land is fragmented into millions of plo- ts which does not allow intensive agriculture. Romania ranks 1st in the EU for the number of holdings, namely 3630 thousand farms,but last in the EU for the average output per holding, namely 3303 Euro. Therefore Roma- nia’s agriculture is still a subsistence and semi-subsisten- ce one, practiced in small farms which do not allow ho- rizontal and vertical integration in the production chain. Therefore the modest performance of the Romanian agri- culture sector places Romania far from having the agri- cultural competitiveness of the other EU member states. Farms with more than 100 hectares, or 250 acres, make up a very small proportion of Romania’s farms. However, commercial farms are investing to increase productivity. In Romania agriculture is a significant contributor towards national economic performance. The significant share of the agricultural sector in the Romanian economy also results in its products being exported worldwide. In 2016 the total external trade in agricultural produ- cts, mainly wheat and corn followed by sunflower seeds and oil, rapeseeds, barley, live sheep and goats, chicken meat, and live cattle, amounted to 6.2 billion Euro, more than 9% of total Romanian exports. Romania is ranked 1st in the EU for growth of agricultural exports. Romania continues to strengthen its position as a grain and oilseed producer and as a leading exporter among EU member states. In 2017, due to favorable planting for winter grain and favorable weather conditions over the course of development, total grain and oilseed produc- tion increased by 12%. Grain exports expanded by an estimated 11%, mainly due to corn and sunflower crops that expanded by 40%, respectively 25%. OPPORTUNITY FOR SILO MANUFACTURERS EU member states are the major source and destination for local agri-food products. In general, around 80% of imported agricultural goods originate from the EU. Hun- gary, Germany, Poland and Bulgaria are Romania’s major trading partners. Romanian exports to the EU account for about 60-70% of total agri-food exports, with Italy, Bul- garia, the Netherlands and Germany as the main markets. Romania’s principal crops - corn, wheat, and sunflower - account for about 15 million acres of farmland. In additi- on, the country’s fertile soil and varied topography support forestry, pasture and rangeland, orchards, vegetables, and vineyards. These offer opportunities for silos, agricultural machinery, irrigation equipment, greenhouses, and agri- cultural inputs such as fertilizers and feed supplements. COMPETING WITH ITS NEIGHBOURS ON THE BLACK SEA IN WHEAT PRODUCTION The EU has provided millions of euros in grants annu- ally to rural businesses, including farms, for investment in agricultural machinery and equipment, manufacturing facilities, and other agricultural purposes. Between 2014 and 2020, a substantial percentage of EU structural funds (about $24 billion) are destined for agriculture within the