Retail chains face checks on what they really pay Bulgarian farmers for their produce. Consumer protection commission head Maya Manolova announced this on the second day of a three-day forum held by the Bulgarian Farmers' Union, "Farmers and Markets – Competitive Through Sustainability". The commission wants these prices made public.
"The checks we're about to run start today, and they'll show the truth about what the real prices are," Manolova said.
The commission also wants the law changed so it can fine firms when their prices stray from fair value repeatedly or by a wide margin. Manolova says the method used to work out "fair value" needs fixing too, since it leaves out production costs. Wholesale prices are based on data from the state commodity exchanges and markets commission, not on what the chains actually pay.
"What's missing from this fair-value method is really the first price — the cost of making the product," Manolova said.
She cited Eurostat figures showing oils and fats in Bulgaria cost 142% of the EU average, dairy and eggs 126%, and sugary products 116%. Overall price levels in Bulgaria stand at 93% of the EU average, while purchasing power is just 68%.
This summer farmers sold watermelons for 9 euro cents and peppers for 30 to 60 euro cents, while shops sold them on promotion at €1.50. Manolova pointed to markups of 80% and 100%, and said the chains import tomatoes from Albania, carrots from Turkey and potatoes from Egypt. As commission head, she wants prices to fall for shoppers — but not at the farmers' expense. What people want, she said, is for goods carrying such markups to move closer to fair value.
The agriculture ministry is setting up a new market information department. It will track quantities, prices and quality on the domestic and foreign markets, deputy minister Prof. Ivan Paligorov said. The state won't set prices, he said, but will demand transparency and full traceability along the chain.
The ministry is talking to the retail chains about making supply chains clearer, from the field to the shopper. Because of fruit and vegetable imports from outside the EU — mainly Turkey and the Western Balkans — it has held joint meetings with the customs agency and the tax agency. These found trucks crossing the border with invoices showing heavily understated values, with the goods then resold several times over at much higher prices. Because of this, such goods will now be taxed at the border based on average real prices rather than the invoice price.
Bulgarian Farmers' Union chairman Georgi Stoyanov, who chaired the forum, said farmers' costs are rising while competition gets tougher. Good raw produce isn't enough, he said: when a farmer has no part in storage, processing or distribution, and no brand or direct sales of their own, most of the added value ends up outside the farm. He said Bulgaria could produce more food than it eats but relies on imports instead — so the work needs to start with the home market. That means planning volumes, keeping quantity and quality steady, and building links between farmers, processors, traders and local markets. Stoyanov pointed to the "Our Own" ["Nashето rodno"] campaign and farmers' events held in various towns as examples that work.
Copa-Cogeca secretary-general Elli Tsiforou addressed the forum by video. She said the main problem is farmers' weak bargaining position and the uneven split of value and risk along the chain, and warned that the costs of the transition shouldn't fall on farmers alone. Joining forces in producer groups and co-ops brings scale, savings and a fairer negotiating position, she said, while a solid Common Agricultural Policy budget in the next EU long-term budget is needed to give farmers the confidence to invest and innovate.
Vladimir Ivanov, head of the state commodity exchanges and markets commission, named badly run markets, a large grey economy and weak legal tools for enforcement as the main faults. He said the law on administrative violations and penalties still reflects rules from 50 years ago, mostly protects offenders, and makes enforcement slow and cumbersome.