The Effect of Coupled Subsidies on the Romanian Soybean Market

In this paper, we have quantified the impact of the Government’s Decision no. 219/2015 upon the soybean market in Romania in the year 2015. For this purpose, we collected data on the soybean areas, production and trade with soybeans and soybean meal, as well as the prices for these products, both domestic prices and foreign trade prices. Based on existing data, we also estimated the minimum coupled support received by farmers per ton of soybeans and per cultivated hectare. The farmers who cultivated soybean in the year 2015 could receive the amount of 373.3 euro/ha, out of which total subsidy for soybeans 181 euro/ton, of which 113 euro/ton represented the national coupled support. If we compare the annual (2015) average soybean price without subsidy (480 euro/ton), with the import price (434 euro/ton), we could draw the conclusion that Romania does not have competitive advantage in soybean cultivation. At the same time, we find out that by subsidizing the domestic soybean production, the exported soybean production increased to 95 thousand tons, and with this export we also exported the subsidy worth 10.735 million euro.