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Wednesday, August 10, 2022

By Announcing the Purchase of Wheat, Golob Also Caused an Increase in the Price of Wheat That Slovenia Might Buy From the Neighbouring Countries

By: Sara Kovač / Nova24tv

In recent weeks, as part of the measures to address the high prices of raw materials and energy in the agricultural sector, the government decided, among other things, that the state is willing to buy this year’s entire wheat crop from Slovenian farmers. After the government meeting that was held two weeks ago, there was even talk of the state buying the entire crop this year through the Agency for Commodity Reserves, which caused quite a chaotic situation among the farmers. Namely, the Prime Minister announced the purchase of all Slovenian wheat but did not specify the price, the required quality, from whom exactly the country would buy the grain, nor the financial terms of the purchase. As a result, chaos has now spread through the entire food chain.

On Friday, the Minister of Agriculture, Forestry and Food explained that they do not want to force anyone to sell wheat to the state. The purchasing will be done through a public procurement, in the framework of which the farmers that will be interested in this option will submit their offers. In public procurement, the priority criterion is the lowest price. But this is where the problem arises, caused by Golob’s recent foolish moves.

Higher prices of wheat also mean higher prices of flour and bread
The Chamber of Agricultural and Food Enterprises, which is part of the Chamber of Commerce and Industry of Slovenia, warned on Friday that in less than a week, Slovenian millers and feed manufacturers have bought more than a third of Slovenian wheat. As they say, the government’s announcement that the state will buy all Slovenian wheat raised its purchase price, although, in reality, they believe that the idea was not feasible. And higher prices of wheat also mean higher prices of flour and bread, they pointed out.

They added that the announcement had a similar impact on the supply of wheat from neighbouring countries, as local growers wanted a similar measure. Slovenia is not self-sufficient in terms of wheat and is also tied to the purchase of wheat from neighbouring countries, the chamber pointed out.

With the end of harvest just around the corner, the government announcement, based on the farmers’ proposal, has caused some confusion in the market. For example, farmers are disappointed that the main criterion for the purchase will be the lowest price. “We would like an urgent purchase of Slovenian wheat, but instead, there will be an intervention purchase from the most favourable provider, which means there is no guarantee that they will actually buy Slovenian wheat,” warned the president of the Cereals Sales Commission, Franc Küčan, in a statement from the media last week.

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