California Ag Network

Category: Nut Industry

  • Efficacy of a Hull Split Spray vs. Sanitation for NOW Control

    Navel orangeworm (NOW) is most effectively controlled with the cultural practice of winter sanitation. Winter shaking almond trees to remove mummy nuts has proven to decrease next year’s NOW damage better than any other approach. The reason for this is clear. NOW overwinters as larvae in mummy nuts left in the tree after harvest and it is in these nuts the population carries over into the next season. Adult moths emerge in spring, mate, and lay eggs on mummies that are still in the trees as the females can’t find the new crop nuts until hull split. The second generation will then put direct pressure on the new crop nuts at hull split and the third generation will chew the nuts up during the harvest period.

    The way almond prices have been going recently, there’s no doubt that everyone is going to have to spend dollars as wisely as possible for the foreseeable future. Although cleaning the trees of mummies during the winter isn’t cheap, it is the method of NOW control where you clearly get the most bang for the buck spent. We’re really playing a numbers game here, and this is one practice that is stacked in our favor by the biology of this pest.

    For example, let’s assume a potential of 50 mummies per tree and 30 of them each have 1 NOW larvae. Half of those are female, and each female lays approximately 85 eggs. At harvest in late July we’re into the third generation, and for arguments sake let’s assume there’s no natural mortality.

    Look at what could theoretically happen to the worm population in one Nonpareil tree with 30 infested over-wintering mummies and no control:

    • 1st generation: 15 females x 85 eggs/female = 1,275 larvae
    • 2nd generation: 1,275/2 (half female) x 85 eggs = 54,188 larvae
    • 3rd generation: 54,188/2 x 85 = 2,302,990 larvae per tree at harvest!!!
                        (Thankfully, there IS natural mortality or else we’d be knee deep in worms!)
    Now, look at the impact of a hull split spray aimed at the second NOW generation. We know that sprays give at best about 60 percent control. This reduces the population but is not nearly as good as sanitation as you will see.
    • 2nd generation: 54,188 larvae x 40% survival after the spray = 21,675 larvae
    • 3rd generation: 21,675/2 x 85 = 921,196 larvae per tree to attack the crop at harvest.
    Now, look at what sanitation does in comparison. Start with the same 30 infested mummies per tree, then winter clean down to 2 mummies per tree. One is female, one is male.
    • 1st generation: 1 female x 85 eggs/female = 85 larvae
    • 2nd generation: 85/2 (half female) x 85 eggs = 3,613 larvae
    • 3rd generation: 3,613 larvae/2 x 85 = 153,531 larvae per tree at harvest.

    (If you can beat the 3rd generation by an early harvest you’re even further ahead.)

    So, a hull split spray reduced the worm population by 60 percent, but sanitation by itself, without spraying, reduced the population by 94 percent! When more NOW larvae make it through the winter, more egg laying will occur next season regardless of what else you do. In relation to the number of mummies left in the tree, expensive chemical treatments next season will only slow the rate of worm damage increase.

    If you have scarce dollars to spend on NOW control, spend them this winter when they will do the most good in a sanitation program. If the entire neighborhood works at this, the positive effect will be multiplied many times over for everyone. If you’ve got neighbors that don’t seem to get it, cleaning your orchard will still be a tremendous help to you. If you have no mummies, the first generation in the spring won’t be able to build up and establish a population in your orchard. You’ll benefit since they’ll have to fly in from the neighbors after hull split before they can begin to hurt your crop.

    Be sure to finish the job by destroying the infested nuts once they’re on the ground. Mow and shred the mummies before March 1st so NOW moths don’t have a chance to emerge. When you’re enjoying mowing during bloom in the spring, take personal satisfaction in seeing the chips and pieces of almond fragments and mangled worm parts fly out from under your mower! — By Joseph Connell, UCCE Farm Advisor Emeritus, Butte County

  • 2023-2024 Winter Chill, Dormancy & Walnut Management Update

    Walnuts are one of the highest chill requirement tree crops in California. Though it’s easy to forget given the luxuriously high amounts of chill last year, multiple recent winters have fallen short of the chill accumulation needed for a tight, economical walnut bloom (e.g. 2014, 2015, 2020). Inadequate winter chill accumulation can result in delayed budbreak, scattered or prolonged budbreak and buds on southern sides of branches never opening. Prolonged bloom can result in a wider variety in nut sizes, more small nuts, and multiple shakes, while also complicating timing of control measures for blight or husk split pests. In the next 20-40 years, Central Valley walnut orchards will get 14-20% less winter chill than in the 1950s when many of our grandparents were farming. Anecdotal experience suggests the chilling requirement for ‘Chandler’ is around 60-65 chill portions as quantified by the Dynamic Model. Given decreased chill projections it is likely that currently planted ‘Chandler’ orchards will not meet their chilling requirement in at least one out of ten years in most of the Central Valley in the coming decades, if left to their own devices. While we wait for high quality lower chill varieties to develop, how can walnut growers manage the chilling requirements of the orchards in the ground now? This has been the topic of many recent years of UC research with funding from the California Walnut Board and the California Department of Food and Agriculture.

    Looking at a sampling of four CIMIS weather stations using the UC Fruit & Nut Center chill calculator tool, on average the Sacramento Valley has accumulated 41 chill portions to date (written January 14th). This is about 20% below last year, and more in keeping with the winter of 2019-2020. While 2019-2020 was a low chill accumulation winter, that was due in large part to a fairly warm February. Thus, it’s too early to say if this is a year in which dormancy breaking treatments would be beneficial. Keep an eye on the UC Fruit & Nut Center’s chill calculator. Nonetheless, it’s good to be aware for future winters that there are options in the toolbox.

    For three winters, we have been studying the impact of a number of dormancy breaking treatments to give growers tools to deal with low chill winters (see here for more detail on previous years). Rather than wait for low chill years to come along, we’ve created warm winter conditions in large, open-top chambers that we’ve built around mature Chandler trees at the UC Davis campus. These trees were coupled with unheated trees that got sufficient winter chill. Approximately 30-40 days before (what we hoped would be) budbreak, dormancy breaking treatments were applied to different scaffolds in each tree. We then monitored budbreak over many weeks to quantify timing of 50% budbreak, the duration of budbreak and the percent of buds that opened on a scaffold.

    Over the course of three years, we’ve tested hydrogen cyanamide, often marketed as Dormex®, a blend of nitrogen compounds marketed as Erger®, an analogue of the plant hormone cytokinin, marketed as Mocksi®, and calcium ammonium nitrate (CAN-17), all of which were compared with a water control. Dormex is the only one of these products currently labeled for use as a dormancy breaker in walnuts (see label for more use details). Erger and CAN-17 are labeled as fertilizers. Over the last two years (2021 and 2022), we found that at least in terms of budbreak timing, it appears Dormex at 2% and 4% and CAN-17 at 20% could prompt heated scaffolds to behave like they had received enough chill, whereas Erger at 6% only partially compensates for lack of winter chill. Dormex at 4% moved timing even earlier than the sufficiently chilled control, whereas Erger moved the timing but only about halfway between the timing of the heated control and the sufficiently chilled control. No effect was seen using Mocksi over two years.

    This previous winter-spring, we put Dormex at 2% and 4% head-to-head. Given that last year was a very high chill winter, it was hard to force insufficient chill accumulation, even with our heated tents. Ambient trees accumulated 78-82 chill portions, while heated trees accumulated 10-12% less, 69-74 chill portions. Both Dormex at 2% and 4% moved terminal and lateral budbreak timing on the heated trees to similar values as seen in the unheated control, in essence compensating for the chill difference. Dormex at 2% also increased the percent of buds that opened, to values as high (lateral buds) or higher (terminal buds) than the unheated control scaffolds. Budbreak percent was not different between Dormex at 4% and the water control within heated or unheated trees. In other words, under these conditions of 69-74 chill portions, it would not have been beneficial to use Dormex at a rate higher than 2%. However, even given this range of chill accumulation, which is considered sufficient, 2% Dormex increased lateral budbreak from 29% to 42% and terminal budbreak from 89% to 98%. That said, in unheated trees, which accumulated 78-82 chill portions, there was no significant increase in budbreak from Dormex use at either rate.

    With generous collaboration from two grower hosts, we also compared Dormex at both 2% and 4% and CAN-17 last year at a field scale, to be able to collect yield data, in addition to budbreak data. At one healthy orchard just a few years into its prime yielding years (10th leaf) near Glenn County, where 73 chill portions accumulated (similar to heated trees on campus), we saw the same change in budbreak timing (3 days earlier) across each treatment when compared to no treatment. This did not lead to significant differences in yield, contrary to what the increased percentage of budbreak in the campus heated tented trees might have led us to expect. Yields ranged on average from 6,240-6,690 lb per acre across treatments. Across size quality measurements (percent jumbos, large, average nut weight, edible yield), nuts from the Dormex treatments were not significantly different from the control, though relative to the control nuts, the CAN-17 treatment had a lower average percentage of large and jumbo nuts (52% v. 64%) and lower average weight (9.15 g v. 10.09 g). There were no differences in color quality as measured by reflected light index (RLI) among any of the treatments.

    At the Chandler orchard at the Nickels Soils Lab, where 82 chill portions were accumulated (similar to unheated trees on campus), there was a small but significant change in timing of budbreak in each treatment relative to the control (3 days). Surprisingly, however, there was also an increase in yield in the 4% Dormex treatments relative to the control, yielding on average more than 1,400 lb more per acre (5,216 lb vs. 6,857 lb). The average yields in the Dormex at 2% treatment and the CAN-17 treatment were also numerically higher than the control (1,019 lb higher and 719 lb higher, respectively), but there was a great deal of variability in different replicates, making it difficult to statistics to decipher if yield differences can be attributed to the treatments. There were no differences between any of the treatments and the control treatment across size quality measurements (percent jumbos, large, average nut weight, edible yield) or color quality (RLI).

    It is perilous to draw conclusions about dormancy treatment efficacy at a field scale based on one high chill year’s data. The difference in yield effects at the Glenn County orchard and Nickels Soils Lab is intriguing. The Nickels site is an older orchard at a tighter spacing, suffering from significant limb dieback from shading coupled with Botryosphaeria infections. One possible explanation for the yield difference would be that the Nickels site benefitted from treatments that encouraged additional budbreak, whereas at the healthy, high yielding Glenn County orchard there was already sufficient budbreak without intervention. Knowing that June drop generally reduces cropload, it’d make sense that increased budbreak, as we saw in the campus trees with 2% Dormex, would not necessarily lead to increased yield. Given high chill accumulation in healthy orchards, dormancy breaking treatments are unlikely to pay for themselves at current walnut prices. If chill accumulation is lower than ~60 chill portions, our heated tent data indicates they may pay for themselves, but we’ll need yield data at production scale to know for sure. The Nickels results point to the possibility that dormancy breaking treatments may be of use in orchards with limb dieback. At the same time, we need to be cautious to watch for swings in yield this coming year that may result from over-taxing the already struggling trees. Particularly given how tight walnut budgets are these days, I’d wait for more data before trying out this orchard-renewal strategy at a large scale if I were a grower.

    We’ll continue this project with funding from the California Department of Food and Agriculture to improve understanding of ideal rates and timings, and the physiological response to these treatments inside the trees. Stay tuned! — By Katherine Jarvis-Shean, Orchard Systems Advisor UCCE Sacramento-Solano-Yolo

  • Preventing Bacterial Blast Damage in Almond This Year

    In 2023, the cold, wet weather during bloom and leaf-out resulted in bacterial blast damage in many Sacramento Valley almond orchards. If conditions this year are cold and wet during bloom, we may see a recurrence of blast: make a plan now to keep blast damage to a minimum.

    The Bottom Line:

    • Bacterial blast can be a problem when cold, wet conditions coincide with bloom or leaf-out.
    • Copper resistance is common in the pathogen: spraying copper is ineffective for preventing blast in many orchards.
    • Frost protection is the most economical prevention option and will help prevent damage from both frost and bacterial blast.x
    • The antibiotic kasugamycin (Kasumin®) is effective for preventing blast when applied up to 7 days before cold, wet weather. It has received approval for availability this year under an emergency exemption registration (Section 18) but is not currently labeled for almond under a full registration (Section 3).The Details:

      Pseudomonas syringae pv. syringae (Pseudomonas) is a bacterium which can infect all aboveground parts of an almond tree. If leaves, flowers, or spurs are infected, the resulting disease is bacterial blast. Pseudomonas is ubiquitous in orchards, so bacterial blast is likely to develop whenever environmental conditions are cold and wet, which favors this disease. Pseudomonas is spread by water hitting the trees, either from rain or sprinklers. If this wetting occurs at the same time as frost damage, Pseudomonas can enter the tree through cells damaged by freezing. Trees are especially susceptible to frost damage during bloom and leaf-out, when tender new growth is exposed to cold temperatures.

      Preventing infection by Pseudomonas is the only way to control bacterial blast. Frost protection in an orchard is your best defense and your most inexpensive prevention strategy: if the trees are not damaged by frost, Pseudomonas will not be able to enter the tree to cause disease. As a second line of defense, research has shown that kasugamycin (Kasumin®) is effective for preventing bacterial blast when applied no more than 7 days before cold, wet weather. Note that kasugamycin is currently not labeled for use in almond, but has become available this season due to a Section 18 exemption. If the weather warrants treatment, kasugamycin can be used as a preventative spray up to two times during bloom. For this spray, complete coverage is crucial for control: all tender new growth must be covered in a protective layer of the antibiotic for it to be effective. Any tissue left uncovered will be unprotected.

      What about copper? Current work by UC researchers shows that copper-resistance is common in Pseudomonas throughout the state. Many of the orchards heavily affected by blast in 2023 received multiple dormant sprays containing copper. In some cases, mixing mancozeb with copper may provide some level of control, but research shows that this mixture is not as effective as kasugamycin and the copper can cause phytotoxicity. — By Jaime Ott, UCCE Tehama, Shasta, Glenn, and Butte Counties

      For more information on bacterial blast, check out these articles at sacvalleyorchards.com

      Bacterial blast/canker: What do we know? – an update on the factors predisposing orchards to damage by bacterial blast, and more details about control strategies for bacterial blast

      Bacterial Blast and Canker – a good description of the various symptoms seen with bacterial blast

  • Tulare County Sheriff and Congressional Candidate Addresses Tree Nut and Beehive Theft

    As California almond orchards are coming to life again in beautiful bloom, most of the nation’s beehives have been strategically placed around orchards all over the state in hopes of a solid 2024 crop set.  Should growers be concerned about these hives disappearing overnight? Watch this brief interview Tulare County Sheriff Mike Boudreaux who addresses this, along with the historical issues of tree nut theft, and measures that have been taken to mitigate these problems. Boudreaux is also running for Congress, and he shared how he plans to represent California farmers if elected to the 20th Congressional District seat vacated by Kevin McCarthy.

  • Growth Opportunities for the Western Pecan Industry

    While the southern states have historically led the nation in pecan production by far, acreage and production trends in the West are rising, according to California pecan grower/processor and American Pecan Council Board Member Blake Houston. Watch his video interview with Matthew Malcolm at the recent Tree & Vine Expo in Turlock, based on his State of the Pecan Industry presentation.  Read more about it in Pacific Nut Producer Magazine.

  • New Almond Board CEO Shares Optimism for Future of Industry

    At the recent Almond Board of California annual conference in Sacramento, growers, hullers and processors witnessed the passing the reigns from the former President Richard Waycott, to the new President and CEO Clarice Turner.  Watch this interview to learn more about Clarice Turner, as well as the experience and optimism for the future of the industry that she brings to the table. Read more in Pacific Nut Producer Magazine.

  • Almond Board of California Announces 2024 Elections

    Elections for the Almond Board of California (ABC) Board of Directors will launch for the 2024-2025 crop year on Friday, Feb. 9 with the call to all candidates to file their petitions or declarations of candidacy by April 1, 2024.

    The industry will choose people to hold two independent grower positions and two independent handler positions on the ABC Board of Directors in voting that starts April 22 and ends May 23. Alternate seats for those spots are also open.

    To be considered for an independent grower or alternate seat, candidates must be a current grower and must submit a petition signed by at least 15 independent almond growers (as verified by ABC). Independent handler and alternate candidates must declare their intention in writing to ABC.

    All details, documents, open positions, the election timeline and deadlines, and frequently asked questions can be found at Almonds.com/Elections. All petitions and declarations must state the position for which the candidate is running and be sent to abcbodelections@almondboard.com or printed and mailed to ABC, 1150 Ninth St., Suite 1500, Modesto, CA 95354. The deadline for all filings is April 1. Potential candidates who’d like more information can contact ABC at abcbodelections@almondboard.com.

    “The ABC Board of Directors is tremendously important to the success of our industry,” said ABC President and CEO Clarice Turner. “More than 7,600 growers and 100 handlers count on them to guide the work of the Almond Board and to help the industry navigate these complicated times and work toward a positive future.”

    The ABC board sets policy and recommends budgets in major areas, including marketing, production research, public relations and advertising, nutrition research, statistical reporting, quality control and food safety.

    Getting involved provides an opportunity to help shape the future of the almond industry and to help guide ABC in its mission to promote California almonds to domestic and international audiences through marketing efforts, funding and promoting studies about almonds’ health benefits, and ensuring best-of-class agricultural practices and food safety.

    ABC encourages eligible women, minorities and people with disabilities to consider running for a position on the Board of Directors to reflect the diversity of the industry it serves.

    About the Almond Board of California
    California almonds make life better by what we grow and how we grow. The Almond Board of California promotes natural, wholesome and quality almonds through leadership in strategic market development, innovative research, and accelerated adoption of industry best practices on behalf of the more than 7,600 almond farmers and processors in California, most of whom are multi-generational family operations. ABC is a non-profit organization that administers a grower-enacted Federal Marketing Order under the supervision of the USDA. It was established in 1950 and is based in Modesto, CA. For more information on the Almond Board or California almonds, visit Almonds.com.

  • Almond Board Announces Exceptional 2024 Almond Leadership Class

    The Almond Board of California is proud to announce the Almond Leadership Program class of 2024, a group of 18 exceptional professionals expected to help lead the industry into the future.

    Bayer Crop Science has sponsored the Almond Leadership Program (ALP) for a number of years and is again the sponsor of this 2024 class of next-generation leaders who were chosen from more than 50 highly qualified applicants. They come from diverse backgrounds across the full range of the industry and include growers and processors, sales representatives, sustainability specialists, company executives, pest control advisors and more.

    ALP began in 2009 and has graduated 226 industry members. Dozens now serve on ABC workgroups, committees and even the Board of Directors.

    “We have had so many great participants through the years, and this 2024 class is simply outstanding,” said Rebecca Bailey, the ABC senior specialist who oversees ALP. “This program helps great people become great leaders and our industry continues to see the enormous benefits from 15 years of ALP. We have no doubt these 18 people will continue to be great assets and advocates for the almond industry.”

    Members of this 15th class – while still working at their jobs – will be immersed in every aspect of the industry, including ABC activities in global marketing, production, nutrition research, food safety and more. They’ll sharpen their communication skills and build lasting relationships with industry leaders, ABC staff and each other.

    “It’s crucial to be connected to people in all areas of the almond supply chain,” said Erik Stanek, a class member and sustainability specialist with Blue Diamond Growers. “Industry challenges are not solved in a silo. For me, ALP offers an opportunity to build meaningful relationships that can lead to actionable solutions. The program helps lift the entire industry.”

    Class members are guided by volunteer mentors – many of them ALP graduates – who will help them develop the skills, knowledge and perspective to improve their industry and their communities.

    “As a mentor, I have an opportunity to share what I’ve learned in the last 25 years as a farmer and a conservation biologist,” said mentor Christine Gemperle, a grower and member of ABC’s Board of Directors. “It’s my hope that the next generation of industry leaders can take that knowledge and grow an even better future for California almonds.”

    The leadership program will also offer class members thorough looks at the impacts on the industry of social, economic, environmental and regulatory issues. In addition, participants will take on a yearlong, self-directed project focused on improving the California almond industry. Some past projects have led to important breakthroughs for the industry.

    Leadership class members kicked off their training with a two-day orientation at the ABC offices in Modesto, which included one-on-one talks with their mentors and hearing from Board of Directors Chair Alexi Rodriguez and ABC CEO Clarice Turner.

    “The leadership program has been incredibly enriching so far. I’ve been introduced to so many fascinating topics beyond my usual scope of work,” said Ziv Attia, part of the 2024 class and head of agronomy at Phytech. “Besides that, the staff and program members are amazing, and I look forward to getting to know them better, gaining further insights and building lasting connections that will contribute to the almond industry’s growth.”

    Once again, class members will raise money for California FFA, pledging to raise more than $25,000 in scholarships for high school students interested in pursuing agriculture in college. Through the years, ALP has raised more than $320,000 for FFA.

    The 2024 Almond Leadership class members are Ziv Attia of Bakersfield and Phytech; Andy Barahate of Kerman andCentral California Almond Growers Association; Gurajan Brar of Madera and Brar & Son Farms; Matthew Brocato of Fresno and Phytech; Mark Cavallero of Madera and Sierra Valley Almonds; Zachary Days of Patterson and Cal Coast Almond Processing Inc.; Mallory Dodds of Fresno and Gowan USA; Ryan Hackett of Modesto and Gold Leaf Farming; Brandon Heinrich of Modesto and B&M Orchards; Amanda Hernandez of Hollister and TriCal Inc.; Victoria Lee of Sacramento and Blue Diamond Growers; Sutter Long of Corning and Bayer Crop Science; Antonio Lopez of Woodland and Yocha Dehe Wintun Nation; Ryan McCoon of Escalon and Cultiva; Edgar Perez of Modesto andAmerican AgCredit; Jeevan Sandhu of Yuba City and Wilbur Ellis; Erik Stanek of Sacramento and Blue Diamond Growers; and Delaney Woolwine of Fresno and Harris Woolf California Almonds.

    About California Almonds

    Almonds from California are a healthy, natural, wholesome and quality food. The Almond Board of California promotes almonds with a research-based approach to responsible farming, production and marketing on behalf of the more than 7,600 almond growers and processors in California, many of whom have third- and fourth-generation family operations. Established in 1950 and based in Modesto, California, ABC is a non-profit organization administering a grower-enacted Federal Marketing Order under the supervision of the USDA. For more information on ABC or California almonds, visit Almonds.com.

  • Opportunities to Grow Tree Nut & Wine Exports in Serbia

    Serbia offers good opportunities for the U.S. exporters of consumer-oriented agriculture products. From January-October 2023, total U.S. exports of agriculture products to Serbia reached $22.6 million, an increase of about 16 percent compared to the same period in 2022. The most significant commodities traded were almonds, whiskey, bourbon, tobacco, sweet potato, pistachios, peanuts, vegetable planting seeds, pet food, cranberries, juices and extracts from hops, wine, dietetic foods, concentrated proteins, snacks food, fish, and seafood products. This report provides U.S. food and agriculture exporters with background information and suggestions for entering the Serbian market. The statistical data are as of October 2023.

    The World Bank (WB) ranks Serbia as an upper middle-income economy based on the Gross National Income per capita of the previous year (2023). Serbia is ranked 35th among the 39 countries in Europe. Moreover, the International Monetary Fund projected real GDP change at 2 percent in 2023. The total GDP is projected at $75 billion. Serbia is a developing country with a vibrant agriculture and food industry which contribute to almost 10 percent of total GDP. In 2023, the average annual inflation rate is expected to be 8.5 percent. Serbia has Free Trade Agreements with the European Union (EU), Turkey, and the Eurasian Economic Union (Russia, Kazakhstan, Belarus, Armenia, and Kyrgyzstan). It is also a signatory to the Central European Free Trade Agreement (CEFTA). January-October 2023 Serbia’s total agri-food exports reached a value of $4.1 billion, a decrease of 8 percent from the same period in 2022. The total agriculture imports in 2022 were valued at $2.9 billion, a decrease of 3 percent compared to the same period in 2022 with a registered $1.2 billion surplus.

    In the January-October 2023 period, agri-food imports were $2.9 billion, a 3 percent decrease compared to the same period in 2022. Over 60 percent of imports come from the EU member states, while 30 percent come from the CEFTA member countries. The total U.S. agri-food exports to Serbia for the January-October 2023 period were valued at $22.6 million, with an increase of about 16 percent compared to 2022. One major obstacle to increasing the U.S. market share in Serbia a is 30 percent customs import tax on most agri-food products, compared to zero import taxes for products from countries with whom Serbia has signed FTAs (about 90 percent of Serbian trade partners). Essential commodities imported from the U.S. include almonds ($4.9M), whiskey bourbon ($3.5), consumer products ($2.6M), pistachios ($2.5M), tobacco ($1.4M), peanuts ($860,000), baby food ($605,000), vegetable seed ($580,000) and hake ($520,000).

    Serbia is the largest agricultural market in the Western Balkans, with strong agricultural production and food processing tradition. Serbia is a global leader in the production of non-GMO corn and raspberries. The food processing industry accounts for approximately one-third of Serbia’s processingindustry. Over 20,000 food businesses are operational, and about 90 percent are micro, small, or medium-sized enterprises. This industry employs more than 120,000 people and is a rare example of a sector that has not been hit adversely by the economic crisis during COVID-19 pandemic. The largest subsectors in Serbia by value are dairy, meat, fruits, vegetables, wine, and confectionery industries.

    Food retail revenue in the Serbian market is approximately $9 billion a year, which represents a relatively small market. Foreign retail chains hold more than 80 percent of the total retail market, mainly divided between Dutch-owned Delhaize (owner of retail chains Maxi and Tempo) and the Croatian Fortenova Group (owner of retail chains Idea, Roda, and Mercator). Other international retail chains include Germany’s Metro, Lidl, and Greece’s Super Vero. Domestic retail chains represent only some 20 percent of the Serbian market: Dis, Univerexport, and Gomex. More than 50 percent of all food products are still sold through small grocery shops (estimated to number close to 30,000). Due to significant changes in consumer behavior during the COVID-19 pandemic, online retail increased by almost 600 percent since March 2020. Delivery services also expanded their business in Serbia by more than 400 percent over the past 3 years.

    Economic Situation

    The Serbian economy is rebounding from last year’s energy price shocks, despite continuing adverse economic conditions both regionally and globally. Economic growth is expected to reach 2 percent in 2023, increasing to 3 percent in 2024 as domestic demand recovers. Unemployment is at an all-time low. Inflation rose to 16 percent in February 2023, which was slightly higher than expected, led by higher food and energy prices. Average inflation in 2023 is expected to be 8.5 percent mostly driven by cost-push pressures. Additional challenges include the performance of the Serbian energy sector and the availability of electricity and gas in the winter of 2024, as well as the rising cost of financing the fiscal deficit and debt obligations considering higher interest rates. With limited space for future stimulus packages, structural reforms are needed to bring the economy back to sustained and growth, boost jobs and incomes. Currently, almost 60 percent of the population’s income is spent on food it is expected to be even more during 2024.

    Serbia needs to make further changes to its regulatory policy, mainly in accordance with the 2023 European Commission (E.C.) Annual Progress Report for Serbia published on November 8, 2023, https://neighbourhood-enlargement.ec.europa.eu/serbia-report-2023_en. According to the report Serbia made limited progress overall. The capacity to pursue key challenges in trade policy needs to be strengthened, to move forward with accession to the World Trade Organization (WTO), where again no progress was made. In October 2023, Serbia provided an updated list of actions to be taken in the context of the WTO accession process as part of the action plan on its remaining legislative alignment with the EU acquis. In the coming year, Serbia should adopt a WTO-compliant law on genetically modified organisms, to move forward with remaining bilateral market access negotiations and towards finalization of its accession to the WTO.

    Overall Business Climate

    Serbia is an open economy with a strategic geographic location that makes it an attractive destination for investment and exports. Serbia has easy access to both EU and non-EU markets, a highly skilled and educated force, and solid infrastructure that has led many global companies to establish manufacturing and service facilities (see Serbia’s Country Commercial Guide https://www.trade.gov/country- commercial-guides/serbia-market-overview?section-nav=5477 ).

    Recent Trends

    The local and regional media frequently publish articles detailing consumers perceived (and actual) discrepancies in the quality of identically branded food products sold in Western Europe and Serbia. Concerns about ingredients and lower quality also have a strong influence on buyers’ confidence in imported products. This “dual ingredient” issue is common in Central and Eastern European countries. Most consumers have adjusted their eating habits and diet for health reasons, increasing health consciousness. Price remains the most important factor affecting purchasing decisions.

    Serbian consumers are increasingly purchasing online especially cross-border retail for lower prices and this segment is expected to grow at an annual average rate of over 10 percent over the course of the next five years. Currently, e-commerce is 5 percent of total retail turnover at about $500 million a year with 2.9 million online shoppers. The number of shoppers is expected to increase to 3.9 million by the end of 2024. Read the full report from USDA Foreign Ag Service HERE.

  • New Chair Introduced at American Pistachio Growers, and What to Expect at Annual Conference

    Rich Kreps has just been announced as the new American Pistachio Growers Chairman of the Board. Watch this brief interview to learn more about Rich and what to expect at the 2024 American Pistachio Growers annual conference coming soon to Monterey, including some special keynote speakers. Learn more and register to attend the conference HERE.