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COVID-19 pandemic did not jeopardize production

Some two to three weeks ago, media reports about people buying in bulk and stocking up on food, cleaning and disinfection products, as well as toilet paper, were second only to the news about COVID-19 pandemic and spreading of the virus. Those reports often featured empty supermarket shelves and were suggesting that the shortage of food and commodities might turn severe.

And for a short period of time, in Bosnia and Herzegovina, those shortages were real; but not when it comes to chicken meat and chicken meat products. This is thanks to BiH’s strong poultry industry and producers who know what they are doing.

Over the last four years Sweden/USAID FARMA II project intensively supported the development of the poultry sector in BiH by providing expert support in aligning relevant legislation and regulatory frameworks with the EU acquis, meeting of EU exports standards including health and quality controls by processors and producers, and in increasing their productivity.

As of last year, BiH received the approval from the European Union to export the poultry meat, processed poultry products and eggs for industrial processing to the EU markets, and the first exports rolled out in September.

Food and health safety standards

For BROVIS, poultry meat processor from Visoko, member of AKOVA GROUP, COVID-19 pandemic did not come as a surprise, and Jasmin Spahić, director of BROVIS, emphasizes that they were ready to respond to it.

“In our production, we always apply HACCP (Hazard Analysis and Critical Control Points) food safety standards and our employees are used to wearing protective gear. With coronavirus we were quick to purchase additional protective gear, as well as disinfection products for employees to use, not only at work but also at home.”

Strong production and safe employment

Jasmin says that their production follows a set time-line from chicks hatching, to having a fully grown chicken, to meat production and processing.  He notes that this process was disrupted by the pandemic, but that there was a 15 percent increase in demand over the month of March which they could cover.

“We noticed an initial increase in the demand and we could cover that. We have our own animal feed production and cooperate with over 100 farmers who grow broilers for us, so we were good there.”

MADI, a poultry meat processor from Tešanj, in the same period decided to decrease its exports, hire an additional 30 employees, and increase production by 15 percent. They also halted the implementation of new projects to free up resources necessary to stabilize situation on the domestic market.

“At the beginning of the pandemic we felt that we need to first satisfy the needs of the domestic market, and only then think of the export. Our reaction was patriotic if I may say so and we did not want to allow for a shortage of chicken meat and processed products to happen among our consumers,” said director of MADI, Maid Jabandžić.

Maid highlighted that no matter what MADI will not be looking to fire their employees, not even the newly employed ones, whereas Jasmin they will do their best for such thing not to happen.

Adjusting to the situation

Markets are a vibrant place nonetheless and things change day by day. For example, several days ago Kosovo lifted tariffs on products from Bosnia and Herzegovina, CEFTA is working on a green corridor for movement of essential products throughout the Western Balkans, and supply and demand on different markets fluctuate.

Demand at the BiH market is now back to normal, and toward the end of March MADI even registered a drop in demand on the BiH market. MADI exports 12 percent of its products mainly to Serbia, Montenegro, North Macedonia and Sweden, while AKOVA GROUP exports a portion of its products to the countries in the region, as well as to the European Union, especially Croatia.

“Things are steady now but we are never risk-free. There is no zero-percent-risk in business, so we will follow the situation on a daily basis and adapt as needed,” says Jasmin. “Markets are volatile and we must keep an eye on them.”

Maid is a bit more skeptical and his big fear at the moment is that the markets might contract due to a developing economic crisis. He sees that happening not just in BiH but globally. “This might turn to be the biggest economic crisis since World War II and we need to be ready for that,” he warns.

Both BROVIS and MADI are recipients of direct Sweden/USAID FARMA II technical assistance, and MADI also received grant support to purchase laboratory equipment and implement the IFS quality standard.

This direct assistance, in combination with FARMA II support related to opening of the EU markets for BiH poultry exports, resulted in improved competitiveness and strengthened value chain for these and other companies, which successfully serve the needs of local consumers during the ongoing COVID-19 pandemic.