The Sweden/USAID FARMA II project supported Rakić Komerc, the egg producer from Bijeljina, in purchasing a drying kiln. This will enable them to produce and store their own animal feed using domestically grown grain.
Rakić Komerc is a well-established family business in Bijeljina, Northeastern Bosnia and Herzegovina. Back in 1989, in a search for business opportunities, the family started trading in animal feed coming from Vojvodina, and various other agricultural raw materials, such as seeds and fertilizers.
Today they have seven agriculture shops, but they are not the Rakić Komerc’s flagships. Rakić Komerc is amongst the five largest egg producers in BiH with more than 33 million eggs producer a year. They also produce some 10,500 tons of animal feed, half of which they use on their farm and the remainder for retail sales.
Business defining turns
In 1995, Rakić Komerc switched from trading in animal feed to producing it themselves. In a short period of time, they came to produce 8,000 tons of different types of animal feed a year. "I was just a kid then, but I remember my father looking for ways to diversify our business and work in several complementary fields. An opportunity presented itself in 2000 and we started producing eggs at a rented farm. Three years later we established our chicken farm and have been growing our egg production here in Bijeljina ever since,” says Jovan Rakić, 28, Production Manager at the family company.
Though they produce the animal feed to use on their farm and sell to others, they were, until this season, still importing corn, which in addition to soybeans and barley accounts for almost 70 percent of the feed content. With a single 1,500 ton storage silo they were not in a position to import larger amounts of corn or store animal feed for long periods.
In mid-2020, Rakić Komerc started building five new 1,000-ton silos. “We need bigger storage facilities to be in a better negotiating position when buying grain. We also want to be able to store the grain and feed for longer periods of time and to better plan our purchases and sales,” explains Jovan. “Our mind was also set on starting to buy domestically grown grain, but we could not afford to simultaneously buy a drying kiln that will enable us to reduce its humidity below 13 percent, which is a must for a long-term-grain storing.”
This is where the Sweden/USAID FARMA II project presented itself as a great opportunity. “I am always looking for projects that can help us develop our business. We applied for a grant with the FARMA II project and we got the support we need to buy the drying kiln already in 2020, instead of waiting at least until 2022 to accumulate our own funds," says Jovan.
Switching to domestic grain
Rakić Komerc installed the drying kiln in late-June and the new silos will become operational in mid-September. “We are looking to buy some 7,000 tons of corn from the Bijeljina region. We have done the research and we believe that some 30 farmers with some 800 hectares of land will be able to produce that amount,” says Jovan. “Had it not been for the coronavirus, we would have had info and training sessions with the farmers already. We would have signed contracts to support them with raw materials and machinery as needed, and they would produce the corn for us. We would also guaranty the payments.”
The pandemic has put those plans on hold but Rakić Komerc is moving forward. “We are now in touch with a number of farmers and are arranging to buy their corn and build our relations,” notes Jovan. “We’ll pay for the corn as they deliver it in 2020 and we hope to jointly plan the 2021 production and perhaps form a cooperative. If all goes as planned in 2021, Rakić Komerc will have egg production which is not dependent on imports of grain and will also supply domestically grown and produced animal feed to other farmers in BiH. In addition, our new silos and drying kiln will also enable us to service other farmers in the area by drying and storing their grain. These are all services that we will be able to provide as of September this year.”