Miller Magazine Issue: 126 June 2020

ROMANIA ROMANIA 80 81 MILLER / JUNE 2020 MILLER / JUNE 2020 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 agriculture, 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. Hav- ing 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, fig- ures which are high above the EU average. The agricultural land is fragmented into millions of plots which does not allow intensive agriculture. Romania’s ag- riculture is still a subsistence and semi-subsistence one, practiced in small farms which do not allow horizontal and vertical integration in the production chain. Therefore the modest performance of the Romanian agriculture sector places Romania far from having the agricultural competi- tiveness of the other EU member states. Farms with more than 100 hectares, or 250 acres, make up a very small propor- tion of Romania’s farms. However, com- mercial 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 be- ing exported worldwide. In 2016 the total external trade in agricultural prod- ucts, mainly wheat and corn followed by sunflower seeds and oil, rapeseeds, bar- ley, 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 is consolidating its posi- tion in the European Union in terms of grains and oilseeds production. Roma- nia’s share in total EU planted area rose to 9% in 2018 while the share in the EU’s harvested production stagnated at about 5% due to low yields. In 2018, total grain production rose by 6%, supported by favorable weather conditions over the course of development. Thanks to its location and relatively large size among Eu- ropean countries, Romania has become a grain exporter competing with its neighbours on the Black Sea. Constanta port is the main gate for agricultural transportation, the storage capacity in the port expanding continuously. According to USDA Foreign Agricultural Service’s (FAS) report released on 14th May, Romania’s grain production is forecast down by 2.6 percent in marketing year (MY) 2020/21 from MY 2019/20. Dry weather conditions will reduce current MY winter crop yields. Soil moisture lev- els remain low in eastern and southeastern regions, but are more favorable in western and southwestern regions. Rains in early May helped winter crops partially recover and provided a strong boost to recently planted spring crops. Corn exports are expected to reach record levels in MY 2019/20. Romania’s area planted for grain ranges between 5.3 and 5.6 million hectares (HA), depending on the total oil- seed acreage. Wheat and corn cover about 85 percent of the total grain area.  The mild 2019/20 winter prompted wheat and barley out of winter dormancy earlier than usu- al. Mid-March frost came unexpectedly after above-nor- mal temperatures. As spring unfolded, plants became more stressed because of increasingly dry conditions, particularly in the south and southeastern regions. In some instanc- es, farmers had to operate irrigation systems as early as of March. Precipitation and soil moisture levels have been more favorable in Romania’s western and southwestern regions. The mild winter and dry conditions also increased the risk of pressure from pests. Based on fall planting and weather conditions, Romanian grain production is forecast to decline in MY 2020/21 by 2.6 percent, despite the 2.2 percent increase in the area planted. As a result, total grain exports are projected to de- cline by 5.5 percent in MY 2020/21, after MY 2019/20’s estimated 9.5 percent increase. Amid fears that grain and oilseed stocks would run low, the Romanian Government suspended temporarily oilseed and grain exports to non- EU markets in mid-April. According to Ministry of Agriculture data, as of April 2020, Romania had just over 1 million HA of irrigable land, with 844,000 HA under irrigation contracts. How- ever, the irrigated area as of late April 2020 was around 200,000 HA, less than 10 percent of the total area planted. Water costs associated with irrigation are covered by the Romanian Government. Funding availability, irrigation in- frastructure development, and farmers’ access to irrigation equipment remain ongoing issues.  Positive developments in grain yield over recent years are partially due to better access to inputs, such as fertil- izers. Total fertilizer usage has grown spectacularly in Ro- mania, with potassium-based fertilizers used 230 percent more than 2010, followed by phosphor with 86 percent, and nitrogen with 62 percent in 2018 versus 2009. For organic fertilizers, the ten-year growth levels were 37 per- cent in terms of area and seven percent in terms of volume. WHEAT YIELDS TO DECLINE USDA post estimates the MY 2020/21 planted area for wheat at 2.2 million HA, a 5.2-percent increase over the previous year. The higher wheat area is partially attributed to the decline in Romania’s rapeseed area. Yields are ex- pected lower this MY due to continued dry weather, no- tably in some of Romania’s most productive counties in its southeastern and eastern regions. Potential production increases in other areas are not expected to offset these reductions. Average wheat yields are forecast to decline