REPUBLIC OF SERBIA Negotiating Group 11 - Agriculture and Rural Development. ARABLE CROPS Cereals, Rice, Oilseeds, Sugar, Seeds, Hops, Tobacco

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1 REPUBLIC OF SERBIA Negotiating Group 11 - Agriculture and Rural Development Bilateral Screening ARABLE CROPS Cereals, Rice, Oilseeds, Sugar, Seeds, Hops, Tobacco Brussels May 2014

2 CONTENT OF THE PRESENTATION Production on utilized arable land structure Legal framework Comparison of basic regulations Sector for: -cereals -rice -oilseeds -sugar -seeds -hops -tobacco

3 PRODUCTION ON UTILIZED ARABLE LAND (2013) Crops Area (000 ha) Cereals Legumes, equivalent to the grain 18 Potatoes 74 Sugar beet 63 Oilseeds 358 Tobacco 6 Vegetables 134 Fodder crops 436 Source: Statistical Office of the Republic of Serbia (SORS)

4 LEGAL FRAMEWORK SUBSIDIES Law on Agriculture and Rural Development (OG RS No 41/09) Law on Subsidies in Agriculture and Rural Development (OG RS No 10/13) - define types of subsidies, manner of using them and requirements for being eligible for subsidies and minimum amounts of funds within each type of subsidy

5 LEGAL FRAMEWORK SUBSIDIES Subsidies in plant production: Decoupled area based payments - 52 /ha; Input subsidies up to 52 /ha; Subsidies for premiums of insurance, 40%; Credit support 6% interest, maximum /holding. Rural Development measures: Subsidies for Investments in agriculture to improve competitiveness and achieve quality standards, 40% or 55% for LFA

6 LEGAL FRAMEWORK BASIS FOR FOREIGN TRADE Law on Foreign Trade (OG RS No 36/09, 36/11 and 88/11) Customs Tariffs Law (OG RS No 62/05, 61/07 and 5/09) and Decree of the customs tariff nomenclature for each calendar year Customs Law (OG RS No 18/10 and 111/12)

7 DIRECT PAYMENTS - COMPARISON EU REPUBLIC OF SERBIA Council Regulation (EC) No 1307/2013 Direct payments - not harmonized with EU

8 MARKET ORGANIZATION - COMPARISON EU Council Regulation (EC) No 1308/2013 Intervention price Production quotas Import export licence Import duties Export refunds REPUBLIC OF SERBIA NO NO Export licenses for sugar to EU YES NO

9 CEREALS Ljiljana Duduković

10 CEREALS PRODUCTION Crops area (000 ha) production (000 t) yield t/ha area (000 ha) production (000 t) yield t/ha Cereals total , ,8 Wheat ,8 Maize , ,9 Barley , Rye , ,8 Oats , ,6 Triticale , ,2 Source: SORS

11 CEREALS PROCESSING Processing undertakings: registered mills (Source: Business Register Agency) registered processors whose main activity is processing of cereals - production of bread, cakes, biscuits, preserved pastry goods, pastries and pasta (Source: Business Registers Agency) - 3 starch factories - starch from maize and wheat

12 IMPORT - EXPORT The largest surplus is realized in the exchange of cereals Maize usually takes first place in the export of agricultural products, by quantity and value Participation in total exports of agricultural products by value in 2013: - cereals 17,3% - wheat (CN ) 7% - maize (CN ) 5,6% Most are exported to EU: - cereal 80-85% - maize 85% - wheat 65% Import (t) TOTAL wheat maize other cereals Export (t) TOTAL wheat maize other cereals Source: SORS

13 IMPORT DUTIES Customs Tariff: CN (excluding 1006) MFN 3-30% - only ad valorem duties applied Preferential regime import: 0% unlimited for: - EU excluding (18%), CEFTA (9%), (ex double cross and top cross 9%), (24%) - Russian Federation - Belarus - Kazakhstan

14 RICE

15 SECTOR OF RICE There is no rice production Legal framework foreign trade - the same as for other cereals Import of rice in 2013 was tons Rice is mostly imported from FYR of Macedonia, Vietnam and Italy

16 IMPORT DUTIES Customs Tariff: CN 1006 MFN 3% - only Ad valorem duties applied Preferential regime import: 0% unlimited, for: - EU - CEFTA - Russian Federation - Belarus - Kazakhstan

17 OILSEEDS

18 OILSEEDS PRODUCTION Area (000 ha) Sunflower Soya Rapeseed Yield (t/ha) Sunflower 2,4 2,2 2,5 2,2 2,7 Soya 2,4 3,2 2,7 1,7 2,4 Rapeseed 2,4 2,0 2,9 2,4 2,8 Production (000 t) Sunflower Soya Rapeseed Source: SORS

19 SUNFLOWER AND SOYBEAN OIL EXPORT (QUANTITY - t) Sunflower oil Region EU CEFTA OTHER COUNTRIES TOTAL Soybean oil Region EU CEFTA OTHER COUNTRIES TOTAL Source: SORS Always in top 10 agricultural products according to the share of the value of exports; Soybean oil usually almost 100% goes to EU; Sunflower oil usually 50% goes to EU and 50% goes to CEFTA countries

20 IMPORT DUTIES Heading 1201 of the Combined Nomenclature MFN 5% TR and EFTA Countries -5% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0% Heading 1205 of the Combined Nomenclature MFN 10% TR and EFTA Countries -10% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0% Heading 1206 of the Combined Nomenclature MFN 20% TR and EFTA Countries -20% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0%

21 IMPORT DUTIES Tariff lines and of the Combined Nomenclature MFN 3% TR and EFTA Countries -3% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0% Tariff lines and of the Combined Nomenclature MFN 30% TR and EFTA Countries -30% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0% Tariff lines and of the Combined Nomenclature MFN 30% TR and EFTA Countries -30% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0% Tariff line of the Combined Nomenclature MFN 30% SAA, TR and EFTA Countries -30% CEFTA and Belarus, Russian Federation, Kazakhstan 0% Heading 1514 of the Combined Nomenclature MFN 10% TR and EFTA Countries -10% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0%

22 IMPORT DUTIES Heading 2304 of the Combined Nomenclature MFN 5% TR and EFTA Countries -5% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0% Customs Law (OG RS No 18/10 and 111/12); Decision on the conditions and methods for reducing customs duties for certain goods, and for the exemption of certain goods from paying customs duties in 2014 (OG RS No 106/13) Heading 2304 MFN 0% Tariff lines of the Combined Nomenclature MFN 10% TR and EFTA Countries -10% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0% Tariff lines and of the Combined Nomenclature MFN - 5% TR and EFTA Countries -5% SAA, CEFTA and Belarus, Russian Federation, Kazakhstan 0%

23 COMPARISON OF MARKET ORGANISATION EU SERBIA COUNCIL DIRECTIVE No 76/621 (EEC) maximum level of erucic acid in oil an fats intended as such for human consumption PARTLY Rulebook on quality and other requirements for edible oils, fats, margarines and (to them) similar products, mayonnaise and other products containing edible oils and fats (OJ SMNE No 23/06) Maximum permitted level 5% Maximum permitted level 2%

24 SUGAR

25 RELEVANCE OF THE SUGAR SECTOR In Serbia, holdings grow sugar beet Size of average holding is 27,8 ha There are 3 sugar producing companies, with 6 operational factories Average daily sugar beet processing capacity is t Production of sugar t One of the most important agricultural export products

26 Number of holdings and sugar beet production area, according to size Source: SORS 2012 Agricultural Census

27 PRODUCTION STATISTICS unit 2008/ / / / /13 Production of sugar beet t ha Production of white sugar t Source: Sugar beet - SORS Sugar Agricultural inspection

28 SUGAR EXPORT 1701 White sugar is the second important agricultural export product, with 6,1% of share in agricultural export value in Source: SORS

29 SUGAR IMPORT 1702 Import of other sugar from heading 1702 is arround t in Source: SORS

30 LEGAL FRAMEWORK Law on Agriculture and Rural Development (OG RS No 41/09) Law on Subsidies in Agriculture and Rural Development (OG RS No 10/13) Customs Tariff Law (OG RS No 61 /07, 5/09, 33/09) Decree of the Custom Tariff Nomenclature for the year 2014 (OG RS No 119/13) Law on Specific Duties of Agricultural and Food Products (OJ FRY No 90/94) Decision on the determination of agricultural and food products that are subject to special charges in import and determining the amount of specific duties (OG RS No 113/13) Law on Foreign Trade (OG RS No 36/09) Decision for preferential sugar export to the EU (OG RS No 60/10)

31 IMPORT DUTIES Customs duties for sugar are combined - ad valorem and specific duties. MFN: Raw sugar 20% + 16 RSD/kg (0,14 /kg) White sugar 20% + 18 RSD/kg (0,15 /kg) Full liberalization: CEFTA, Russian Federation Partial liberalization EU: Raw sugar 20% + 12 RSD/kg (0,10 /kg) White sugar 20% + 12 RSD/kg (0,10 /kg) MFN: EFTA, Turkey, Belorussia, Kazakhstan

32 EXPORT TO EU Law on Foreign Trade article 23 Decision for preferential sugar export to the EU: - By this Dеcision the access on import into the Community/EU for sugar originating in Serbia from headings 1701 and 1702 of the Combined Nomenclature, within the limit of an annual tariff quota of t (net weight) is regulated for the duration of one marketing year (from1 st October to 30 th September). - The export of sugar to EU countries, according to the Decision, is conducted based on a licence issued by the Ministry responsible for internal and external trade. - Commission for licensing export of white sugar to EU countries, is formed by the Minister responsible for external and internal trade from representatives of that Ministry, Ministry responsible for agriculture and Ministry responsible for finance and customs, is deciding upon submission to export sugar to EU countries.

33 SEEDS

34 SEEDS SECTOR IN FIGURES Seed production of 60 agricultural species, app varieties and hybrids are entered in the Agricultural Plants Variety Register (National Variety List) Registers which also exist: Register of producers including distributers and Register of processors An authorized institution is in charge for issuing of labels is Agricultural Extension service - Sombor Three authorized laboratories are ISTA accredited The Republic of Serbia participates in OECD scheme, two authorized institutions for issuing OECD certificates exist

35 SEEDS SECTOR IN FIGURES SEEDS PRODUCTION (ha) Wheat Maize Other cereals 7,085 2,366 2,097 2,784 4,264 Soybean Sunflower Rapeseed Sugar beet Lucerne (alfalfa) Other forage plants Potato Vegetables TOTAL Source: MAEP

36 SEEDS SECTOR IN FIGURES SEEDS PRODUCTION (t) 2009/ / / / /14 Wheat Maize Soybean Sunflower Rapeseed Sugar beet Lucerne (alfalfa) Potato Vegetables Source: MAEP

37 LEGAL FRAMEWORK Law on Seeds (OG RS No 45/05, 30/10), regulates: Categories Register of producers including distributers and Register of processors Production Inspection of the production Seed processing Packaging and labeling Quality Placing on the market Post-control tests

38 LEGAL FRAMEWORK Law on Registration of Plant Varieties (OG RS No 30/10) Law on Protection of Plant Breeder's Rights (OG RS No 41/09, 88/11) Law on Plant Health (OG RS No 41/09) Law on Subsidies in Agriculture and Rural Development (OG RS No 10/13) Decree of the Custom tariff nomenclature for 2014 (OG RS No 119/13) and rulebooks adopted pursuant to above mentioned laws

39 SPECIES CUSTOM TARIFF FOR 2014 Rate of duty % (MFN) SAA CEFTA EFTA BKR TR Maize 30 0/9 0 MFN 0 MFN Wheat MFN 0 MFN Soybean MFN 0 MFN Sunflower MFN 0 MFN Rape seed MFN 0 MFN Sugar beet MFN 0 MFN Lucerne (alfalfa) MFN 0 MFN Potato MFN 0 MFN SAA - Stabilization and Association Agreement, CEFTA-Central European Free Trade Agreement, EFTA- European Free Trade Association, BKR-Bilateral agreement with Belorussia, Kazakhstan and Russia, TR- Turkey

40 HOPS

41 HOPS SECTOR IN SERBIA Production is decreasing, only 20 ha in 2013 The average yield is 1,5 t/ha

42 HOPS SECTOR IN SERBIA HOPS PRODUCTION Area (ha) Yield (t/ha) 1,64 1,76 1,89 0,91 1,05 Production (t) Source: SORS

43 LEGAL FRAMEWORK Law on Subsidies in Agriculture and Rural Development (OG RS No 10/13) Decree on custom tariff nomenclature for 2014 (OG RS No 119/13) Rulebook on quality and other requirements of hops and hop products (OG RS No 54/05)

44 SUBSIDIES Subsidies in hops sector: Decoupled area based payments 52 /ha; input subsidies up to 52 /ha; subsidies for premiums of insurance, 40%; credit support 6% interest, max /holding. Rural Development measures: Subsidies for Investments in agriculture for improvement of competitiveness and achievement of quality standard, 40% or 55% for LFA; Perennial crop plantations, 40% or 55%

45 CUSTOM TARIFF FOR 2014 Rate of duty % SAA CEFTA EFTA BKR TR CN Code (MFN) MFN 0 MFN MFN 0 MFN MFN SAA-Stabilization and Association Agreement, CEFTA-Central European Free Trade Agreement, EFTA-European Free Trade Association, BKR-Bilateral Agreement with Belorussia, Kazakhstan and Russia, TR-Turkey

46 COMPARISON OF LEGISLATION EU - SERBIA EUROPEAN UNION Registration of contracts (1557/2006) Certification of hops (1850/2006) Producers organisation (1299/2007) SERBIA NO NO NO

47 TOBACCO

48 TOBACCO SECTOR IN SERBIA Area of tobacco is approximately 6.200ha The average yield is 1,6 t/ha Produced by approximately holdings 8 manufacturers 8 tobacco processors 4 manufacturers of tobacco products (tobacco factory)

49 TOBACCO SECTOR IN SERBIA TOBACCO PRODUCTION Area (ha) Yield (t/ha) 1,61 1,79 1,59 1,36 1,61 Production (t) Source: SORS

50 LEGAL FRAMEWORK Law on Tobacco (OG RS No 101/05, 90/07, 95/10, 36/11, 93/12 and 108/13) Law on Subsidies in Agriculture and Rural Development (OG RS No 10/13) Decree of the custom tariff nomenclature for 2014 (OG RS No 119/13) Customs Law (OG RS No 18/10 and 111/12) Decision on the conditions and methods for reducing customs duties for certain goods, and for the exemption of certain goods from paying customs duties in 2014 (OG RS No 106/13) - Preferential regimes Law on Specific Duties of Agricultural and Food Products (OJ FRY No 90/94) Decision on the determination of agricultural and food products that are subject to special charges in import and determining the amount of specific duties (OG RS No 113/13)

51 LAW ON TOBACCO* The production, processing and trade of tobacco and tobacco products in the Republic of Serbia Tobacco varieties: Virginia, Burley, Oriental and Semioriental Obligatory contracts between all participants in the production and market of tobacco Registers: Tobacco producers Tobacco processors Importers and exporters of tobacco Producers, importers and exporters of tobacco products... * Ministry of Finance

52 CUSTOM TARIFF FOR 2014 CN Code Description Rate of duty (MFN) SAA CEFTA EFTA BKR TR 2401 Unmanufactured tobacco; tobacco refuse: Tobacco, not stemmed/stripped: Light air-cured tobacco ex: Burley (including Burley hybrids) 10% + 15,00 RSD/kg (0,13 /kg) MFN 0 MFN 0 MFN Sun-cured oriental type tobacco 10% MFN 0 MFN 0 MFN Dark air-cured tobacco 10% MFN 0 MFN 0 MFN Flue-cured tobacco ex: Virginia type 10% + 5,00 RSD/kg (0,04 /kg) 10% 0 MFN 0 MFN Other 10% MFN 0 MFN 0 MFN Tobacco, partly or wholly stemmed/stripped: Light air-cured tobacco ex: Burley type (including Burley hybrids) partly stemmed/stripped 10% + 20,00 RSD/kg (0,17 /kg) MFN 0 MFN 0 MFN ex: Burley type (including Burley hybrids) wholly stemmed/stripped 10% + 25,00 RSD/kg (0,21 /kg) MFN 0 MFN 0 MFN Sun-cured oriental type tobacco 10% MFN 0 MFN 0 MFN Dark air-cured tobacco 10% MFN 0 MFN 0 MFN Flue-cured tobacco ex: Virginia type, partly stemmed/stripped ex: Virginia type, wholly stemmed/stripped 10% + 7,00 RSD/kg (0,06 /kg) 10% 0 MFN 0 MFN 10% + 10,00 RSD/kg(0,09 /kg) 10% 0 MFN 0 MFN Other 10% MFN 0 MFN 0 MFN Tobacco refuse 10% MFN 0 MFN 0 MFN SAA-Stabilization and Association Agreement, CEFTA-Central European Free Trade Agreement, EFTA-European Free Trade Association, BKR-Bilateral agreement with Belorussia, Kazakhstan and Russia, TR-Turkey

53 TOBACCO TRADE TRADE (t) EXPORT IMPORT PREFERENTIAL REGIME* Import 0% customs, equivalent to the value of the tobacco produced or purchased on the domestic market by producers of tobacco products * Ministry of Finance, 2014

54 COMPARISON OF LEGISLATION EU - SERBIA EUROPEAN UNION Cultivation contracts (2095/2005) Prices and stocks (2095/2005) Producer organizations (1308/2013) Interbranch organizations (709/2008) SERBIA YES NO NO NO

55 PLANS FOR THE FUTURE The Law on Market Organization of Agricultural Products is expected to be the basis for more precise regulation of the market. By-laws will define rules related to arable crops. Our legislation will be harmonized with the EU no later than on the date of accession.

56 THANK YOU FOR YOUR ATTENTION