Albanian farmers face higher production costs than their competitors in the region, due to heavy dependence on imported inputs, low financial support from the state, labor shortages, and weaknesses in agricultural infrastructure.

The combination of these factors makes domestic production more expensive and weakens its competitiveness against products coming from Serbia, North Macedonia, and other Western Balkan countries.

According to reports by the Food and Agriculture Organization of the United Nations (FAO), smallholder farmers in the region, especially those in Albania, spend an average of about 28% of the total value of production just on the purchase of seeds, chemical fertilizers and pesticides.

Most of these inputs are supplied by imports, so farmers' costs are directly affected by international prices, exchange rates, and transportation costs.

For small farms, which dominate the structure of Albanian agriculture, opportunities to buy in bulk and negotiate more favorable prices are limited.

One of the main reasons that places Albanian agriculture in a more unfavorable position is the low level of direct subsidies.

Data reported over the years show that other countries in the region have provided an average of over 53 euros in direct support per hectare, while in Albania, this support has historically been calculated at around 3 euros per hectare.

The difference is approximately 18 times. This gap means that the Albanian farmer must cover a much larger portion of the costs from his income.

In neighboring countries, subsidies cover part of the costs of inputs, fuel, agricultural machinery, or investments, enabling the product to reach the market at a more competitive price.

As a result, Albanian products face competition not only from European Union production, but also from agricultural goods from countries in the region that have more stable support policies.

In addition to direct costs, there are losses stemming from climate change, droughts, and inadequate irrigation infrastructure.

The FAO report on the state of food and agriculture highlights that the hidden costs of the agricultural system, which include environmental damage and losses caused by climate change, weigh more heavily on countries with more limited incomes and investment capacities.

In Albania and other Western Balkan countries, the lack of modern irrigation systems increases the dependence of production on weather conditions.

A dry season can significantly reduce yields, while the costs of tillage, seeds, fertilizers, and pesticides remain the same. This further increases the cost per unit of production and the farmer's financial risk.

Another strong pressure comes from the shortage of labor. Emigration and the departure of the population from rural areas have reduced the number of workers available in agriculture.

The shortage is particularly acute during planting and harvesting periods, when the demand for workers increases in a short period of time. Farmers are forced to offer higher daily wages, while in many cases, the produce is not harvested on time or part of it remains in the fields.

Dependence on imported inputs, much lower subsidies than in neighboring countries, limited yields, irrigation problems, and the rising cost of labor are creating a multiple burden on Albanian agriculture.

Without increased support and investments that reduce unit costs, local farmers risk further losing ground to imports and subsidized producers in the region./ Monitor.al