Meat industry in Lithuania suffers heavy losses over ASF and Russian sanctions

31-Aug-2014 - Last updated on 04-Sep-2014 at 09:32 GMT

Farming organisations in the Baltics are pushing for compensation from the European Commission

Related tags Latvia Lithuania Estonia Livestock Pork

Meat producers in Lithuania have reported heavy losses due to the continuing spread of African swine fever (ASF) and the sanctions on meat supplies to Russia.

According to the chairman of Lithuania’s Chamber of Agriculture Andrejus Stanchikas, these problems may result in the livestock industry in Lithuania dying out.

The Chamber of Agriculture said that a significant fall in prices for milk and meat have made almost all producers unprofitable and, as the result, farmers are considering changing their types of activity.

"There is a real danger the current problem will mean that, soon, Lithuania will produce only crops," said Stanchikas.

According to government estimates, the Russian embargo alone will lead to losses for the Lithuanian meat industry amounting to LTL250m (€73m), and for the milk industry LTL200m (€58m). The damage from the spread of ASF could be much worse as it has already meant the country cannot look for alternative markets for its pork.

In addition, a lack of help from the state is making the situation worse. The Lithuanian government announced that it would pay some money to support meat producers, but would not allocate any funds to meat processors, as there were no additional funds in the state budget.

"We cannot provide financial assistance [to meat processors] from our own budget," said the country’s Prime Minister Algirdas Butkevičius.

It is also not clear if producers would receive any compensation, as Butkevičius added that Lithuania was only going "to seek assistance for them during negotiations with the European Commission".

Baltic countries may join forces to claim support

At the same time, the Baltic countries have decided to put on a united front when it comes to claiming compensation from the European Union (EU), due to the ban on meat exports to Russia.

Farming organisations in Latvia, Estonia and Lithuania are planning to send an open letter to the EU commissioner for agriculture, Dacian Cioloș, asking him to grant to all three Baltic countries the status of a buffer zone, due to losses from the Russian embargo.

Farmers in Latvia, Estonia and Lithuania plan to ask the European Commission to provide more support than that given to other EU countries to cover losses from the Russian sanctions. Their justification for this was "that the Baltic States, given their location next to Russia, suffered more and more heavily [from the trade restrictions on meat import] than other EU countries".

"The current support of 35-50% does not suit us. It is very small. If [a Baltic] government gives €1m in support, the EU gives €350,000. This is ridiculous. We are the buffer zone of the European Union. We believe the support should be a much higher," said Latvia minister of agriculture Janis Douglas.