1. CECILIA ALEXANDRI, Institute of Agricultural Economics, email: cecilia@eadr.ro Conference SFER – RuralEst: 20 ans de transition agricole et rural a lEst: quel enseignements?

2. Instability of world and European agricultural markets – evolutions and causes Methodological elements, data sources, indicators for the analysis of Romanias situation Discussion of results regarding the agricultural prices, the processing prices and consumer prices evolution in Romania The analysis of price volatility in different stages of the agrifood chains Conclusions

3. Structural factors Agricultural productivity trends stagnate or decrease Lack of public funds invested in agricultural research Fast growth of demand due to record development rates, urbanization and change of diet in the emergent countries Other destinations given to the agricultural production (biofuels) Seasonality of agricultural production constrains the adjustment possibility Conjuncture Extreme weather conditions Low level of stocks Increase of energy and oil prices Increased presence of speculative investment funds on agricultural raw materials markets Economic crisis

7. The intensity of adjustment How much of the agricultural price variation is transmitted along chains to final consumers The transmission intensity depends on the cost structure, chain and market operation, etc Rate of adjustment Length of time in which the agricultural price variation is transmitted to the final consumer -The marketing policy of large retailers -Spatial dispersion and number of stages of the chains The asymmetry of price adjustment To what extent the increase or diminution of agricultural prices is transmitted to the final consumer Increase of agricultural price increase of consumer price Diminution of agricultural price increase or diminution of consumer price

8. Agricultural prices are volatile, mainly in the recent period- since 2007 there have been two price increase/decrease cycles. Consumer prices are more stable. On long term (in the last 50 years) : - Agricultural prices had a decreasing tendency, but many experts support the vision that the trend will reverse in the next years -Consumer prices had a slow increasing tendency, almost continuous Agricultural prices are volatile, mainly in the recent period- since 2007 there have been two price increase/decrease cycles. Consumer prices are more stable. On long term (in the last 50 years) : - Agricultural prices had a decreasing tendency, but many experts support the vision that the trend will reverse in the next years -Consumer prices had a slow increasing tendency, almost continuous

11. Monthly series of agricultural price, processing price and consumer price indices, by sector and by main products Perioad January 2006-November 2010 Analysis of price transmission at the level of the entire agrifood sector and for the baking and meat and meat products chains Analysis of price volatility in different stages of the chains and their dispersion evaluation, by certain time periods, through variation coefficients.

13. IPCa - 29%, Pret procesare - 54%, Pret agricol - 66%

15. Prices evolution in the different stages of the milling and baking chain (2005=100)

17. Evolution of prices along the chain of meat and meat products ( 2005=100 )

20. INCOMES EVOLUTION IN REAL TERMS GDP IN PPP-S TERMS IN DIFFERENT REGIONS OF ROMANIA

21. ANNUAL AVERAGE CONSUMPTION PER CAPITA IN 2009 CHANGES IN THE FOOD CONSUMPTION IN ROMANIA IN THE YEAR 2009 COMPARED TO THE YEAR 2000

22. In the investigated period 2005- November 2010: The agricultural prices experienced size variations higher than in EU, mainly prices of vegetable products, due to the instability of the Romanian agricultural supply and fragmentation of the regional markets. The consumer prices were more stable, being restricted by the purchasing power, yet they have an almost constant increasing tendency at low rates. Price transmission along the chains has an asymmetric character in the sense that the processing price and the consumer price increase even though the agricultural price decreases (for instance on the meat and cereal products chain) The distortions in price variation transmission along the chains is mainly due to the asymmetry of the negotiation power between the economic operators on the agrifood chains and the farmers, and to the imperfect competition on the markets A significant part of the consumed food products comes from import (for example: vegetables, fruit, meat preparations, even cereals in some poor agricultural years); that is why the world and European market evolutions are directly felt by the Romanian consumer In November 2010, compared to 2005, in nominal terms: -agricultural prices increased by 80% -processing prices increased by 56% - consumer prices by 30% -the gross average salary income by 101%