Uticaj cijena inputa na konkurentnost domaće poljoprivrede / Impact of input prices on competitiveness of domestic agriculture

Prices of agricultural products are generally formed by the cost-plus method, i.e. adding a certain margin on the sum of the cost of inputs that are spent for their production. Therefore, a competitive producer is the one who succeeds to produce a particular product at a lower cost than other producers. In open market conditions producers are unable to obtain market confirmation of their costs, so they are forced to sell their products at the market price, which is formed on the equilibrium level of supply and demand. In order to resist the competition of imported products, domestic producers must produce the same products cheaper or at least at the price of imported products. Assuming the same expenditure of raw materials and other inputs, their production costs depend on the price at which they buy these inputs. Most of the inputs for agriculture in BH are imported, so they are therefore more expensive than in neighboring and developed countries that produce food which is imported in BH. The paper presents the results of the analysis of price trends of some key agricultural products (corn, wheat, soybeans, potatoes, apples, milk, beef, pork, chicken and eggs) and the price trends of inputs used in their production (seeds, organic and artificial fertilizers, chemicals for plant protection, fuel, labor, professional services, fattening material, fodder, veterinary drugs and services, electricity) in order to determine whether these relationships have a favorable or unfavorable impact on the competitiveness of domestic agricultural producers. The analysis was conducted at the level of the Republic of Srpska for the period 2008-12 by calculating the aggregate price competitiveness index for selected agricultural products by comparing the price index of final products and the weighted price index of inputs used in their production. The results showed a favorable effect of cross price changes on the competitiveness of producers of apples and eggs, neutral impact in the production of maize and unfavorable effect on the competitiveness of producers of all other analyzed products (wheat, soya, potatoes, milk, beef, pork and chicken).