USAID Agribusiness USAID Agribusiness Project Project
Jan 22, 2016
USAID Agribusiness ProjectUSAID Agribusiness Project
USAID Agribusiness Project
USAID Agribusiness ProjectUSAID Agribusiness Project
5 year project from Sept 28, 2007 – Sept 27, 2012 Implementing Partners: DAI, BAH, IRD, Michigan
State University Total Value $24 million
Grants: $5,2 million
Project Locations: Belgrade – Head office Field offices in Niš, Novi Sad and Čačak-TBD
USAID Agribusiness Project
What Do We Want?What Do We Want?
RapidSustainedBroad Based
Economic GrowthEconomic Growth
USAID Agribusiness Project
Meaning…Meaning…
ROI - at least 25 to 1 - Sales growth of $600 million
Increasing competitiveness Creating a sound enabling environment
- Policy, market information, service providers
USAID Agribusiness ProjectGlobal Enabling Environment
National Enabling Environment
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How?Global Markets
National Markets
Export
Input Supply
ProcessingProcessing
Wholesale
Production
Sector Specific
Cross Cutting
Financial
Supporting Service Markets
USAID Agribusiness Project
CriteriaGrowth potential
- Impact on the economyBroad based development impact
- Reaching a large number of peopleFeasibility
- To get traction and have an impact
USAID Agribusiness Project
Sustainable Impact: Competitiveness
The opportunity: Domestic and export market growth potential
- Replace imports, compete globally Potential for broad value added impact Potential for increase in productivity (yield/ha,
reduced post harvest losses, cold storage improvement, shelf life etc.)
Significant return on investment - Best use of project resources
USAID Agribusiness Project
Broad Based Impact: Broad Based Impact: Development CriteriaDevelopment Criteria
The highest potential to benefit a broad base of the population
A large number of households/employment involved with each commodity
Forward/backward linkages Per capita income increase On and off-farm jobs growth opportunity
USAID Agribusiness Project
Rapid Impact: FeasibilityRapid Impact: Feasibility
The selected commodities yield rapid results Interest of producers and other value chain
actors to participate with the project Ability to produce results within project desired
time frame Private sector involvement Potential to deliver successful Ag Business
Services
USAID Agribusiness Project
Selecting the Sub-sectorsSelecting the Sub-sectors
Supported by hard data for objective comparison
Essential elements:Economic growthReturn on investmentBroad outreach
Be flexible during the analysis – if not able to have impact, drop it!
USAID Agribusiness Project
SELECTED SUB-SECTORSSELECTED SUB-SECTORS
Berry FruitDairyHerbs, Spices &
Mushrooms
LivestockTree FruitVegetables
USAID Agribusiness Project
BerriesBerries
USAID Agribusiness Project
USAID Agribusiness Project
Berries - OverviewBerries - Overview
> 80,000 farms, 250 cold stores, and 100 processing factories
$172 million sales in 2006- $151 million exports
- $21 million local market salesExisting varieties suitable only for processing
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USAID Agribusiness Project
MARKET OPPORTUNTIES
PROPOSED ACTIVITIES
1. Export and domestic demand for fresh berries
2. Shift from frozen bulk export to frozen retail
3. Immediate export opportunities for value added products
Lack of new varieties
Lack of modern production knowledge and technology
Lack of standards
Logistics
Packaging
Lack of associations
Lack of marketing knowledge and activities
Lack of management and negotiations skills
SUPPLY CHAINCONSTRAINTS
Develop projects on growing new varieties
Assist foreign and local nurseries in Serbia
Re-print and distribute SEDP extension materials
Local and foreign production support Study tours of foreign producers and
processors Implementation and education of
standards Assist development of logistical
companies Packaging design and innovation Support existing and new associations Support market information services Assist Serbian companies to participate
in foreign fairs Sales trainings Management and negotiations training Finance and risk management trainings
BerriesBerries
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USAID Agribusiness Project
Processors • Support shift from frozen bulk to frozen retail market• Support developing value added products• Strengthen Marketing & Market Access• Support Intl. Standards Implementation/Certification
•Exports increased by $170 million• Local sales increased by $30 million• 120,000 PM of new jobs created
Produce organizations
• Build management and marketing capacity• Support implementation of new varieties• Support standards implementation• Support Networking & Market Access
Service providers • Increase technical capacity• Develop new customer based services• Develop network with local producers
Policy • Becoming Union for Protection of Varieties [UPOV] member
STRATEGY RESULTSTARGET
BerriesBerries
USAID Agribusiness Project
Dairy ProductsDairy Products
USAID Agribusiness Project
Tree FruitTree Fruit
USAID Agribusiness Project
Tree Fruit - OverviewTree Fruit - Overview
Orchards are about 6% of total arable soil (240,000 ha)
150,000 people in fruit production and processing [12% of the total agricultural labor force]
75% farmers have less than 5 ha 5% have more than 10 ha of
orchards
Major fruit crops: plums, 52% of all orchards in Serbia apples 18% and sour cherries 11%
Total farm value of fruit production is US$ 300 million - 16% of total production
Fresh Fruit Export - US$ 21 million in 2006
apples US$ 11 million; stone fruit US$ 9 million; other fruit US$ 1 million
Fresh fruit imports: US$ 4.5 million in 2006
Processed Fruit Export - US$ 80 million in 2006
juices [55%] frozen cherries and plums [37%] preserves [5%] dried [3%]
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USAID Agribusiness Project
MARKET OPPORTUNITIES
SUPPLY CHAIN CONSTRAINTS
PROPOSED ACTIVITIES
1.Fresh fruit for the Russian market
2.Quality fresh fruit on lucrative EU markets
3.Increase growth of processed fruit exports (juices, dried, frozen)
• Introduction of advanced technologies in fruit growing and post-harvest handling
• Improved farm management skills through adequate training programs
• Provide Serbia’s fruit growers with the guidelines for tree fruit production principles and practices and efficient record keeping system
• Facilitate networking of existing and creation of new producer organizations
• Assist implementation of international food safety standards and organic certification of farmers and processors;
• Support domestic production of certified virus-free nursery plants
• Developing domestic production of prunes, and dried fruit• Technical assistance for adequate packaging and labeling
• Conduct research and sales development studies;• Strengthen business linkages and transfer of know-how
through efficient info dissemination, market study tours
• Low productivity
• Poor quality control
• Lack of product variety
• Extension of growing/selling season
• Outdated service providers
• Lack of value-added packaging
• Weak Sales and Marketing Structure
Tree FruitTree Fruit
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USAID Agribusiness Project
STRATEGY RESULTSTARGETS
Processors/ Packers
Meeting food safety standards for exportDevelop product diversification and packagingTransition bulk exports to retail packaged opportunityImprove fresh produce quality (post harvest handling)Extend selling season of fresh produceImprove marketing capacities and market access
Exports increased by US $66 million
Increased domestic sales by US $33 million
44,000 PM of new jobs created
Producer Organizations
Implement GLOBALGAP farm standardIntroduce advanced fruit growing techniquesSupport establishment of new producer organizationsImprove management capacity
Service Providers
Shift toward market competitiveness advisory servicesSupport regional networking - improve farmers’ access to
providersSupport advancement of domestic nurseriesIntroduce new varieties - certified virus-free
Policy Redesign subsiding criteria to boost sub-sector developmentLaw on Cooperatives and Associations
Tree FruitTree Fruit
USAID Agribusiness Project
Dairy products - OverviewDairy products - Overview
1.6 billion liters/year 50% through formal
channels 25 large and over 200
small/medium dairies 25 largest dairies account
for 75% of production
US $600 million - Total farm value
Main products: Fresh and UHT milk, yogurts, cheese
99% - Domestic sales US $6 million of export
[CEFTA]
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USAID Agribusiness Project
MARKET OPPORTUNITIES
PROPOSED ACTIVITIES
1. EU QUOTA
2. Milk paid by stricter quality standards
3. Meet growing demand for milk and value added products
4. Preferential trade agreement with Russia & CEFTA trade zone
• 50% of milk goes through Gray Market. EU Quota will be based on Formal Economy
• Raw milk quality below EU standards
• Half Milk Supply From Small Dairy Farms – A Part Time Job (<5 Cows)
• Low productivity cow• Low quality and quantity on
breeding stock (only 5-10% of pure Holstein Cows)
• Lack of milking equipment • Little product diversification • Lack of organic production• Lack of specialty products• Inadequate marketing• Political Risk & Non tariff
barriers
SUPPLY CHAIN CONSTRAINTS
• Develop a network of service providers and support regional demo centers
• Educate and support introduction of high breed Holstein heifers and dairy semen/embryos
• Support the forming and upgrading of regional labs
• Introduce regional milk and breeding recording system
• Support the creation of umbrella Holstein and/or Simmental association
• Link to USA dairy expertise • Establish new Milk Development
council• Support existing SME processor
associations• Help exporters - packaging,
promotion, and exports
Dairy productsDairy products
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USAID Agribusiness Project
STRATEGY RESULTSTARGET
Dairy Processors Support end-user products development and diversification
Support establish of milk development council
Exports increased by $5 million
Local sales increased by $120 million
100,000 PM of new jobs created
Service providers Develop a network of service providers
Assist in developing New Customer-oriented Services
Support networking & market access
Small & Medium sized Farmers/PO’s
Transform small and medium sized farmers into viable commercial agribusinesses
Support creation of regional/national dairy association
Policy Feed and milk quality control Harmonization of domestic legislation with EU directives
Dairy productsDairy products
USAID Agribusiness Project
Herbs & Spices, Mushrooms, Herbs & Spices, Mushrooms, Forest FruitForest Fruit
Chamomile, Mint, Yarrow, Thyme, Paprika, Parsley…
Porcini, Chanterelle, Truffles, Button Mushroom…
Wild berries, Rose-hip, Juniper…
USAID Agribusiness Project
Herbs & Spices, Mushrooms, Herbs & Spices, Mushrooms, Forest FruitForest Fruit - Overview - Overview
Total value of the sub-sector: $94
million (2006) 2006 exports:
US $45 million EU and ex YU 38% unprocessed
Number of people involved: 90,000, mostly women, rural poor & unemployed
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USAID Agribusiness Project
MARKET OPPORTUNITIES
SUPPLY CHAIN CONSTRAINTS
PROPOSED ACTIVITIES
1. Shift to Processed Herbs
2. Cultivated Herbs and Mushrooms
3. Value-added processed Mushrooms & Forest Fruit for export and domestic market
4. Organic products
Inadequate handling
• Low prices for collectors
• Low quotas
• Insufficient knowledge about processing and market needs
• Lack of modern processing equipment
• Lack of diversified production
• Lack of growing/ harvesting equipment
• Underdeveloped Supply Chain
• Lack of knowledge about organic production and certification
• Improve harvesting and storing practices through training and technical assistance
• Support value-added processing• Technical assistance to Value Chain
Stakeholders to improve quota system
• Trade fairs and specialized exhibitions
• Strengthen business linkages• Facilitate linkages between
processors and retailers• Facilitate new investments in
cooperation with the financial sector• Assist service providers/nurseries to
introduce new species and services• Specialized training programs in
Organic production
Herbs & Spices…Herbs & Spices…
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USAID Agribusiness Project
Exporters and
Processors
• Support end-user product development• Strengthen marketing & market access• Support Intl. standards implementation /
certification• New Products and Services
Introduced• Exports increased by $30M• Domestic sales increased by
$25M• 10,500PM of New Jobs
Created• 10 Supply/Value Chains
Strengthened
Service Providers • Develop technical capacity• New customer-oriented services
introduction/Development • Support networking & market access
Producer Organizations • Improve Management & Marketing Capacity• Increase commercial growing• Assist Good Agricultural & Collection Practice
development & Implementation• Support organic food production
Policy • Quota System Improvement • Market Information System [MIS] Improvement/Extension • Relaxation of Import Procedures for Agricultural Inputs
TARGETS STRATEGY RESULTS
Herbs & Spices…Herbs & Spices…
USAID Agribusiness Project
VegetablesVegetables
USAID Agribusiness Project
Vegetable - OverviewVegetable - Overview
> 10 % of arable land under vegetable production, cca 500.000 ha, average farm 3-5 ha
> 30 processors involved 50 % achieved standards [HACCP,
Global Gap…]
About 1.8 million tons of fresh vegetable production in 2006 (US $500 million)
100,000 tons of processed vegetable exports 2000-2005
Average export value 2000-2005 US $55 million
Main export partners: EU, ex YU and, recently Russia
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USAID Agribusiness Project
MARKET OPPORTUNITIES SUPPLY CHAIN CONSTRAINTS PROPOSED ACTIVITIES
1. Extend marketing season [ root crops and cabbage]
2. Processed vegetables (sweet corn, industrial pepper, peas, green beans…)
3. Fresh with high profit margin (parsley, celery, parsnip, cauliflower, broccoli and watermelons)
• Inadequate product variety and extension of growing and selling season
• Poor quality control and post harvest management
• Low productivity
• Lack of adequate (cold) storing facilities
• Inadequate extension services
• Value added packaging
• Insufficient use of irrigation system and modern agriculture equipment
• Low level of cooperation between farmers organizations and processors/retail chains
• Lack of marketing knowledge
• Support demonstration plots and trainings on advanced technologies in vegetable production, post harvest handling
• Develop training programs for new (cold) storing technologies
• Develop programs for creation of network of agribusiness service providers providers
• Workshops on packaging and labeling standards
• Facilitate provision of loans and new investments to the producer organizations in cooperation with the financial institutions
• Facilitate linkages between the producers organization and buyers
• Marketing and sales training
• Support industry study tours and trade show participation
VegetablesVegetables
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USAID Agribusiness Project
STRATEGY RESULTS TARGETProcessors, Exporters,
Packaging centers
• Technical assistance for processors and exporters• Strengthen Marketing Promotion & Market Access• Support Intl. Standards Implementation/Certification• Develop linkages with PO’s to have contracted prod.
according to buyers specifications•Local sales increased by 25M$
• 60.000PM of New Jobs created
•Exports increased by 45M$
Service providers
• Develop capacity building program for agribusiness service providers using voucher and grants
• Create regional/national network of agribusiness service providers
• Support Networking & Market Access
Producer Organizations
• Develop Management & Marketing Capacity• Trainings: extension of growing season, post harvest
handling and quality control, organic production, improve demonstrations
• Develop/Strengthen Long-term Cooperation with buyers• Improve domestic certified seed production
Policy • Laws on cooperatives and associations• Environmental impacts on agriculture• Encourage adherence to EU laws and regulations• Align Serbian subsidies with EU common agricultural policy
VegetablesVegetables
USAID Agribusiness Project
Cattle - Beef Cattle - Beef Transitioning from Existing “Dual Purpose” Dairy & Beef Cow BusinessesTransitioning from Existing “Dual Purpose” Dairy & Beef Cow Businesses
USAID Agribusiness Project
Cattle Beef - OverviewCattle Beef - Overview
• In the 1980’s, most of Yugoslavia’s exports came from Serbia and totaled over 20,000 tons annually, with well over 10,000 tons to the EU and about 10,000 tons to Halal Moslem markets
• 5 EU certified slaughterhouses - Over 100 million Euros in new investments.
• During 2005-07, Serbia’s beef exports amount to about 2,000 tons valued at US $10 Million annually of “Baby Beef” exported mostly to Italy and Greece.
• Annual beef production of 85,000 tons valued at US $350 million mostly comes from young dairy bulls. About 90% of beef is processed, with an ex-factory value of US $700 Million.
• About 150,000 dairy & beef farms exist in Serbia, of which 120,000 are small farms in gray sector.
• All cattle farms must be registered by EU and new GOS laws
• Beef processing plants employee about 10,000 persons and beef sector service jobs amount to 5,000
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USAID Agribusiness Project
MARKET OPPORTUNTIES
PROPOSED ACTIVITIES
1. Unfulfilled Export and Domestic Demand
2. To Export “Baby Beef” to EU and Russia.
3. To Export “Halal Beef” to Middle East, Bosnia, and Albania.
Shortages in Supply chain
International market access
Lack of Technical knowledge
Poor Access to Credit and Rollover Utilization
Insufficient Farmer representation
SUPPLY CHAINCONSTRAINTS
• Assist export plants• ID/register all cattle• Use/develop Ag. service providers• Trainings in animal husbandry, feeding
and farm management• Adopt EU & international Standards• Support Veterinarian Extension Services
• Work with processors in marketing and sales
• Credit facilitation• Promote foreign direct investment (FDI)• Market information systems• Institutional building• Trade policy discussions
Cattle - BeefCattle - Beef
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USAID Agribusiness Project
STRATEGY RESULTSTARGET
Farmers & Producers
•Transition real jobs by moving small gray sector farmers into legal registered business
•Support farm coop’s & assn’s and include small cattle farmers in associations
• Increase service providers to EU Levels
• 100,000 PM of new jobs• Domestic sales and exports
increased by US $200 million
Cattle Farmers Associations
•Expand existing beef and dairy cattle assn’s to cover all cattle in Serbia
•Establish a separate beef cattle sector
Abattoirs, Processors and Exporters
•Turn the newly formed “Baby Beef” processors assn. into a strong industry group like in EU countries.
• Boost EU beef exports to 10,000 tons• Regain Halal beef exports to Middle East at 10,000 ton average for former Yugoslavia
• Start up exports to Russia
Policy • Implement EU standards, EU and Halal certification for Serbian slaughter houses• ID and track all cattle from farm to consumers via meet processing plants
Cattle - BeefCattle - Beef
USAID Agribusiness Project
Livestock - Swine Squeezing in Swine
USAID Agribusiness Project
Swine - OverviewSwine - Overview
• Pork has the highest per capita consumption rate for meat in Serbia, but is about 30% to 40% below EU levels.
• In 2006, Serbia produced about 1.7 million head of pigs, yielding 255,000 tons of pork, valued at about US $400 million.
• For international trade, Serbia imports and exports less than 5% of its supply of pork.
• Pig numbers grew rapidly after the Balkan wars because of high reproduction rates and growing consumption based on low priced corn and soybean meals.
• About 50,000 swine farms exist in Serbia, of which 45,000 are small farms in gray sector.
• All swine farms must be registered by EU and new GOS laws and shift to formal sector.
• Pork processing plants employee about 10,000 persons and pork sector service jobs amount to 7,000.
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USAID Agribusiness Project
MARKET OPPORTUNTIES
PROPOSED ACTIVITIES
1. Growing domestic per capita pork consumption creates room for expansion
2. Export Niche to Montenegro.
3. Exports of Canned Pork to Russia and Neighboring Balkan Countries have large Potential.
• Inconsistent Supply and Quality Issues
• Low Farmer Representation in National Livestock Associations
• Lack of Technical Knowledge.
• Low Credit Utilization.
• Loan Facilitation is Constrained by Lack of GOS WHR Law.
• Canned Pork plants Not Yet Certified to Export to Russia or Other Countries
SUPPLY CHAINCONSTRAINTS
• Training farm management and animal husbandry
• Market Information Systems (MIS) Price & Market situation Information
• Support adoption of international Standards
• Support Producer Associations
• Promote Foreign Direct Investment (FDI)
• Credit Facilitation
• Serbian Agricultural Ministry & Vojvodina Agricultural Secretariat Work
• Support Extension & Veterinarian Services• Work with processors to facilitate access to loans• Strengthen and expand service providers
SwineSwine
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USAID Agribusiness Project
STRATEGY RESULTSTARGET
Farmers and producers
•Transition Real Jobs by Moving Small Grey Sector Pig Farmers into Legal Registered Business
•Support Farm Coop’s & Assn’s & Include Small Pig Producers in Livestock Assn’s
•Boost service providers to EU Levels
•12,000 PM of new jobs•Domestic sales and exports increased by US $40 million
Pig Farmers Assn’s
•Expand Existing Beef and Dairy Cattle Assn’s to Cover All Cattle in Serbia
•Establish a national Pork Producers Association
Abattoirs, Processors,
•Move Almost 100% of Swine Slaughterhouses into Legal Formal Businesses
• Bring Whole Industry Up to EU Standards.
Exporters
•Boost Processed Pork Exports to 1,000 tons•Start Up Exports to Russia
Policy•Implement EU standards and EU certification for Serbian slaughter houses•ID and track all pigs from farm to consumers via meet processing plants
SwineSwine
USAID Agribusiness Project
Livestock - Sheep and GoatLivestock - Sheep and Goat
USAID Agribusiness Project
Sheep and Goats Sheep and Goats OverviewOverview
• Serbia exported most of Yugoslavia’s sheep meat and cheese before 1990’s, over 2,000 tons annually, valued at US $5 million. 50% of herd decimated during Yugoslav Wars and sanctions
• In 2006, Serbia produced over 20,000 tons of young lamb and old mutton sheep meat valued at US $50 million.
• About 1.6 million head of sheep are currently raised In Serbia, of which only about 350,000 head are milking sheep and most go for meat production. Yields of sheep meat and milk are 50% of EU average.
• Recent Investments in sheep farms have greatly expanded with electric fencing and imports of better Heavier meat breeds from the UK and elsewhere in Europe.
• Sheep cheese from Pirot branded as “Kackavalj” was traditionally 80% sheep milk cheese and 20% cow milk, but now is 80% cow milk and 20% sheep milk because of the lack of sheep milk
• In 2006 about 10,000 tons of goat cheese was produced Valued at US $50 Million. Goat cheese production is rising rapidly as French alpine dairy goat are being Imported and reproduced in large numbers.
• Roughly 250,000 head of milking goats are raised in Serbia, but most all the young male kid goats are slaughtered right after birth to save on milk usage, but could be used for raising meat for export to Switzerland, nearby Halal Moslem, and other markets.
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USAID Agribusiness Project
MARKET OPPORTUNTIES
PROPOSED ACTIVITIES
1. Unmet domestic and export demand
2. Market demand for rejuvenated sheep cheese production,
3. Goat Cheese Output and Branding to Achieve Higher Prices.
4. Young male kid goat exports
• Inconsistent Supply and Quality Issues
• Lack of Technical Knowledge
• Low Credit Utilization• Low Farmer
Representation• Inefficient Low Yields in
Sheep & Goat Farms • Market Access
• Small Farms Have Low Rate of Use of New Breeds
• Low Public Awareness of Subsector and Brands of Sheep & Goat Products
SUPPLY CHAINCONSTRAINTS
• Processed Goat Cheese Sales & Niche Exports
• Improve Wool Clipping and Exports to UK Market
• Young Lamb Exports to Greece & Halal Markets
• Promoting the Kaĉkavalj Pirot Yellow Sheep Cheese Brand
• Promoting Lamb from Zlatibor, Tara, Homolje,
• Encourage better sheep genetics
• Concentrate on sales of high value young lamb meat and live lambs
• Support the introduction of high yielding heavier EU breeds
• Promote Foreign Direct Investment (FDI)
• Credit Facilitation
Expand producer associations
Leverage funds from Serbian Agricultural Ministry and Vojvodina Agricultural Secretariat
Support Agribusiness Development Services (ABDS)
Market Information Systems (MIS)
Sheep & GoatSheep & Goat
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USAID Agribusiness Project
STRATEGY RESULTSTARGET
Farmers and producers •Support development of Farm Coop’s, service providers & Producer Associations
•Transfer Small Farmers into Legal Registered Business
• 12,000 PM of new jobs• Domestic sales and exports
increased by US $100 millionProducer Associations Support Farm Coop’s, ABDS Producer Assn
Abattoirs & ProcessorsSupport a Well Recognized EU Level Sheep and Goat Assn. & tie into ABDS
ExportersExpand Exports of Lamb Meat. Boost Production of Hall Lamb and Exports to Former Yugoslavia’s levels
Policy • Implement EU standards, EU and Halal certification for Serbian slaughter houses• ID and track from farm to consumers via meet processing plants
Sheep & GoatSheep & Goat
USAID Agribusiness Project
Cross-cutting ActivitiesCross-cutting Activities
Marketing & export promotion
Policy Extension services Micro finance/loan
officers training Study/sales missions
Grants- Investment Incentive - Enabling
Youth enterprise- Business plan competition - 4H