TIRANA, July 1- Livestock breeding is facing difficulties in Albania due to lack of selling market, high emigration, lack of state subsidies, and adding lately the reducing of the VAT reimbursement threshold for farmers from 20 to 8 percent. Ismail Beka, from the German Organization for International Cooperation (GIZ) and an expert on agriculture, has warned that livestock investments in some cases were not well thought out. In many cases, a livestock complex was built with 200-500 cows, or 500-1000 cattle in a compound of farmland. A few years ago, he warned that large investments were focusing on modern investment in stalls’ buildings, through the import of high-capacity livestock breeds from European countries, modern milking systems were installed, but all the feed for breeding of them had to be bought at high cost through imports.
He said that now farms are facing bankruptcy due to lowering livestock. Especially estranging is the bankruptcy of large farms such as Rramilli Biofarm. The VAT threshold reduction induced the increase of milk prices which is higher than importing milk. After farmers decreased the price per liter at 40-42 lek from 45 because dairy-processors wouldn’t buy their products, farmers are now discouraged whether they will get reimbursed by the government. The government said it was going to reimburse farmers at 10 lek per liter, only after all tax invoices are filed. Most of them have done so, but have received no money so far.
A farmer, Agim Mile from Kucova who started out with 10 livestock and now works with 30, said he will most probably go bankrupt because of the little to no support, livestock food is expensive, milk sales are low in price and thus the entire activity results in losses. Mile benefited about 700 thousand lek (5700 euros) as subsidy, which is not enough for his farm. He added that new policies to promote livestock breeding should be drafted, as both existing and potential farmers are losing interest in this sector.
Regarding large livestock farms in the country, they have entered a difficult survival cycle. Bankruptcies have increased because their products are not competitive with the black market and imports. High basic food costs and high market informality derive farm products at 35 percent higher than imports. Ismail Beka explained that the share of livestock investments are seen as industry and are made by inexperienced people. They built the silos as an urban environment without land available. Farms used modern technology, got international high-yield races, food-dispersed technology, but were forced to import food and keep animals in barns. Beka said that each cow needs at least half a hectare of land, and with Albania’s climatic conditions, the livestock must remain in the free state. He added that it was also invested in foreign races that did not fit the climate conditions in Albania, while it could be invested in Albanian races, which would yield lower production but are more resistant to ecosystem conditions here.
In fact, the statistics on imports of dairy products, eggs and honey saw double digit growth during January-May 2019, increasing by 18 percent compared to the previous year. This was the largest increase in imports of dairy products, eggs and honey products since 2008, as Albanian Institute of Statistics (INSTAT) data on foreign trade show. The largest increase in imports was recorded in February and March, where imports on these products increased respectively by 26 and 41 percent. In April, the increase was lower reflecting the government’s decision to subsidize by 10 lek per liter, while in May imports again recorded double-digit growth of 18 percent compared to the same month of the previous year. For the price of milk, eggs and cheese, the price level in Albania is calculated by Eurostat at 94 percent of the European Union average, and over 20 percent more expensive than the regional countries.
According to INSTAT the number of cattle in 2018 was 467,318, down by 1.7 percent compared to 2017. The number of wool cattle was 1,863,837, decreasing by 3,2 percent compared to 2017. 73,3 percent of the total herd is comprised by sheep. The number of goat heads was 917,155, declining by 1.7 percent. The number of pork was 184,133, increasing by 2.2 percent. Milk production in 2018 was about 1.14 million tons, down by about 1 percent compared to 2017. The milk production structure accounted for 85.1 percent cow milk, sheep milk at 7.4 percent and goat milk by 7.5 percent. In 2018, milk production by cows is 973,526 tons or 0.9 percent less compared to 2017. Sheep milk decreased by about 2.5 percent, and the production of milk from goats was 0.9 percent lower.
