Focus on Czechia

by Chris Lyddon
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Map of Czech Republic
 
The International Grains Council (IGC) forecasts total Czech 2017-18 grains production at 8.1 million tonnes, down from 8.4 million in 2016-17. Wheat is the biggest crop, with forecast production of 5 million tonnes in 2017-18, down from 5.5 million the year before. It is followed by barley, with the 2016-17 crop forecast at 1.9 million tonnes, up from 1.8 million the year before. Czech rapeseed production is forecast at an unchanged 1.4 million tonnes.

An E.U.-wide attaché report dated March 30 gave a possible reason for a smaller crop.

“Winter conditions, especially very low temperatures in January, were not ideal for the winter crops,” it said.

The country is notable for the relative size of its farms.

“By far the largest average size of agricultural holdings in any of the E.U. member states in 2013 was the 133 hectares recorded for the Czech Republic,” the E.U. statistics body Eurostat said in a note on its figures. The U.K. comes second at 94 hectares, while the E.U. average was 16.1 hectares.

Flour milling

According to the European Flour Millers, the Czech Republic had 45 flour mills with a total capacity of 1.743 million in 2014. Forty-four of those mills had a capacity greater than 2,000 tonnes. They produced 944,000 tonnes of wheat flour and 109,000 tonnes of rye flour.

“Most mills have vertical relations with the bakers,” the European Flour Millers’ Manual on the European Flour milling industry said. “In one case, the main operator is a large agricultural company. In three other cases, the owner is a grain storage company. Eleven mills have shared connection to the bakers. Three enterprises are owned by industrial pasta (makers).”

The organization put capacity utilization at 78%. During the period between 2007 and 2014 the capacity of existing mills increased by 10% while some companies disappeared. Most of the wheat used, about 97%, is home grown.

Czech grain production
Source: Czech statistical office
 
According to the European Flour Millers, the national association is the Association of Industrial Mills of Czech Republic, which represents 90% of total production with 25 members, covering 35 mills.

“Food consumption of wheat in the Czech Republic has been very stable,” the attaché noted in an annual report published in 2016. “Feed consumption stagnates or slightly declines in accordance with developments in the animal sector.

“The consumption of baked goods has been gradually increasing, reaching 52.7 kg in 2014. Consumption of bread somewhat increased after several years of decline and reached 40 kg per capita in 2014, a 1.78% increase when compared to 2013.

“The reason behind this increase is, according to the Union of Bakers and Confectioners, a larger and more varied supply, the consumer trend shifting toward baked goods that are not prepared from frozen semi-finished products, and a favorable price of bread. The most popular kind of bread remains the traditional Czech bread prepared from wheat and rye.”

The largest export market for Czech wheat is Germany. According to figures quoted by the attaché, total exports in 2015-16 were estimated at 2.166 million tonnes, of which Germany took 1.64 million. The report explained that the Czech Republic tends to export unprocessed grain and import processed products.

“According to the Czech Union of Industrial Mills, mills in the Czech Republic are quite obsolete, and require financial investments,” the attaché said. “Investments into modernization will result in consolidation, and some of the smaller mills will likely go out of business.”

The country is interested in exporting to emerging markets and the attaché predicted that sales to countries like Cuba, which had taken 24,000 tonnes of Czech wheat in the previous decade, would grow.

Biotech crop declining

Genetically engineered (GE) Bt corn, the only GE variety approved for cultivation in the E.U., has been on decline in the Czech Republic, the attaché report said. Its area peaked in 2008 with 8,380 hectares, and eventually shrunk to 997 hectares in 2015 due to marketing difficulties and extra costs from a requirement for separate storage and labeling.

The more recent combined attaché report on the E.U.-28 actually shows a dramatic fall, to just 75 hectares. A separate report on biotechnology in the E.U. gives an explanation.

“In the Czech Republic, the area has gradually decreased due to difficulties in marketing the corn commercially (farmers use it for biogas production and on-farm cattle feeding),” the attaché said. “The Czech Republic can be seen as conflicted insofar as the country is favorable to agricultural biotechnology but the advisory body to the Ministry of the Environment has adopted a position on oligonucleotide-directed mutagenesis stating that this technique produces “GMOs.’”

A separate national attaché report on biotechnology gives the area of field trials of genetically modified crops conducted in the Czech Republic in 2016 as slightly over three hectares, including buffer zones.

“Czech scientists and farm groups are vocal in their support for more crop biotechnology,” it said. “With its rational and scientific approach to biotechnology, scientists and academia do not hesitate to publicly dispel myths spread by some non-governmental entities.

“Czech Ministries vote for new biotechnology events at the E.U., both for import and for cultivation. Czechs, however, supported the option for other member states to impose biotech cultivation bans. They did so citing the Czech position of strict neutrality on such scientific issues and to support other members’ decisions, as they expect support for their own decisions to plant the technology.”

The Czech Republic has no bans on importing of GE crops and imports bioengineered soybean meal, a main protein source for feed mixes, it said. In 2015 the soybean meal imports totaled 407,000 tonnes. Major suppliers are Brazil, Malaysia and the United States. Most imports are trans-shipped through the main European ports in the Netherlands and Germany.

Biofuels

The Czech Republic implemented the E.U. legislation and has set targets for greenhouse gas (GHG) savings, for the share of biofuels and renewable electricity in transportation on total consumption, and blending mandates, according to the attaché.

“There are sufficient production capacities and feedstock available to meet those targets. However, a recent increase in the excise tax might challenge meeting those goals in 2017,” the attaché said.

In 2015, the Czech Republic produced 104,715 tonnes of ethanol. The main feedstock was sugar beets (55%) and corn (45%). Production capacities involve four ethanol plants that could together produce nearly 300,000 tonnes of ethanol per year. In 2015, as well as in 2014, only two of them were operating.

“Production capacities for biodiesel consist of five major plants and a few small-scale ones, totaling at slightly over 400,000 tonnes per year,” the attaché said. “In 2015, only three of them produced biodiesel. Czech biodiesel production in 2015 reached 167,646 tonnes, with rapeseed the main feedstock.”

The attaché estimated the 2016 rapeseed crop at 1.312 million tonnes, a 4.5% increase.

“After two years of decline in rapeseed area, it increased year-on-year by 7.3% in 2016-17, as farmers were encouraged by favorable prices,” the attaché said in a report on the sector.
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