Roses also have thorns 29.11.2019

13 million levas are sought for subsidies. At present Bulgarian rose producers receive only the land subsidies, which are paid in general to all farmers in the country. The industry has already sent a letter to the Ministry of Agriculture, urging it to start receiving help and funding from the new EU programming period, the so-called "Tied support", which basically supports payment per kilogram of rose petals according to issued invoices. Such bonuses are currently paid to fruit and vegetable producers. "The symbol of Bulgaria – The Bulgarian rose oil deserves such assistance," said Hristo Nikolov, chairman of the Professional Association of the Rose Farmers in Bulgaria. The industry also demands funding for the rose spraying with detergents as well as the introduction of "green payments" in cases when rows between the plants are being grassed. Apart from this, it is proposed to reimburse the organic production subsidies for eligible producers. For the past three years, no new organic producers have been added because the Rural Development Program’s budget has been exhausted. According to calculations of the rose industry, about 13 million leva per year are needed for all these subsidies. Subsidized production will certainly contribute to a lower price for the rose petals.

Roses are extremely beautiful plants but they have thorns as well. Lots of the local entrepreneurs who had embarked on the fragrant business, attracted by the high purchase prices until a few years ago, understood this. It turns out some of them made the wrong choice of seedlings and now they understand what they chose is not suitable to turn into Traditional Bulgarian Rose Oil. The year is also hard for established manufacturers because less oil is synthesized in the petals due to the lack of sunshine. Last year the price per kilogram of the "liquid gold" collapsed by 20-30%, and now the industry's hopes are the price just to stop falling.

“Over the past 2 years, 700 hectares of new plantations with roses have been created, with which the existing rose fields in the country have grown to 4500 hectares. This is a growth of over 18%, but that does not mean that all of the new plantations have adequate planting material of Rose Damascena Mill, the oil-bearing rose – "Rose Damascena", from which the authentic Bulgarian rose oil is being distilled", so Gergana Andreeva, the Executive Director of the “Bulgarian National Association for Essential Oils, Perfumery and Cosmetics" summarized for "The Economist". The vast majority of farmers entering the industry either ignorantly or overwhelmed by promises of better yields actually trusted uncertified seedlings. Right now, in their second year, the new plants are already shaped and bloom and it becomes clear they are not fit for the quality end product. "Technologists are able to recognize them even with a bare eye. Normally, if the farmer meticulously looks at his work and carefully controls the deliveries, he wouldn’t allow the distillation of such petals", says Hristo Nikolov for "The Economist".

Filip Lissicharov, Vice-chairman of the Association "Bulgarian Rose Oil" points out that the new players are not some speculators but investors with free capital who want to diversify the risk of their other investments and businesses. At the same time, the "driving force" of the rose oil in Bulgaria continues to pant because there are only 43 distilleries in the country that have to process production coming from

officially 4500 hectares but in reality certainly over 5000 hectares, as the smallest farmers do not officially register, explains Hristo Nikolov. An opportunity to tighten control in the production process lies in the forthcoming "Rose Law", which has already been discussed in Parliament, just before the recent EU elections. This is the law that makes it obligatory new plantings to be planted only with certified cuttings and to establish official registers for both farmers and distilleries. However, this campaign will go without its implementation.Problems for the established players as well.

Even the well-established producers and processors experience problems this year. The reason is that the roses are pale, instead of getting pink, because of the rainy weather and lack of sun. "This means there is not enough concentration of rose oil in the petals" explains Juliana Ognyanova for "The Economist", who also owns rose fields in Pavel Banya. The only hope to improve this trend is if there is more sun until the end of this year’s campaign which would contribute to better roses. Hailstorms form recent days also took their share and destroyed dozens of hectares in Karlovo and Stara Zagora. The abundance of rain leads to more plant diseases, which requires more treatments, raising costs. There are also places where it has not rained at all, but the problems there are different - the yield is between 20 and 40% lower.

The principle of the limited supply which leads to price increases applies for the roses as well, but producers are not optimistic about such a scenario. The reason is there are quantities left on the stock from the previous two campaigns not only in Bulgaria but also in neighboring producers such as Turkey. That means there won’t be any shortage of rose oil on the international markets. Last year’s price of the oil was 7 000 euros per kg. and the year before that 9 000 euro.

But earlier it ranged between 10 500 and 12 000 euro (2016). At that moment the highest price for rose petals reached 5 leva per kg.

Some distilleries shared with "The Economist", the prices for this year’s roses are still to be formed, but it is expected to be in the range between 2,20-2.50 leva/kg.

Farmers are saying it is below the net cost of the roses they produce. For them, in order to be able to grow crops and collect quality roses according to all standards and requirements, a good price should be between 3,20 and 3,50 leva per kg. In general, for quality growth of flowers on 1-hectare expenses would be 2000-3000 leva per year and the average yield of flowers for the whole country is about 3000- 3500 kg. per hectare. Expectations for this year's harvest are about 1.4 tons of oil.

Hristo Nikolov, who owns 12 hectares of rose fields in the village of Dabene, near Karlovo, says there are problems in finding pickers as well. A significant part of the pickers is organized by gypsy leaders, who send them to the highest bidder of the day. The normative requirements for registering one-day employment contracts for temporary agricultural workers are another source of problems. "In our plantation, at a certain moment, we have to hire between 80 and 100 pickers. What time exactly should these people come in the morning, so we can have enough time to prepare their one-day contracts, fill them in and let them go to work? We hire them under labor contracts. But they are extremely volatile, we are working on the edge of the law" adds Nikolov.

Patent on the EU market but without control

Already in the autumn of 2014 the Association "Bulgarian Rose Oil" registered Bulgarian Rose oil as a protected geographical indication (PGI), a patent for the EU market. It turned out, up until 2 years ago, only two distilleries were certified to use this patent, and for last year's harvest their number increased to 10, said Filip Lissicharov. He believes the reason for the low interest in this certification is that the state is constantly delaying and does not make the certification process absolutely mandatory. Apart from that, there is no control whatsoever. "The state does not help, it does not exercise any control. There is not a single shipment stopped at customs. Everyone is free to write "Bulgarian rose oil" on top of their product, even if it has not been certified", explained Lissicharov. He has found his own way to "protect the patent" - for the second consecutive year the entrepreneur organizes educational Study Tours for rose oil processors and users from around the world. The idea is to bring them to Bulgaria and show them how roses are grown, how they are picked and how they turn into oil, so they finally understand what makes this raw material so expensive. “This year’s tour consists of 26 professionals from 12 different countries. Now, during the peak of the harvest, there are representatives from the biggest Australian company for distribution of essential oils, companies from Germany, India, USA, China, Check Republic", explains Lissicharov. The educational trips last 5 days and include visits of four distilleries, one local cosmetic company, and a producer of end products with roses. The rose picking period is also the time when most of the travel agencies are getting in contact with the distilleries and sending tourists. The biggest boom is June 2 when Kazanlak is conducting the annual Rose Festival. The lowest prices for a one-day trip from Sofia start from 39 leva.

As for the Bulgarian rose oil as an expensive raw material, it has no place on the Bulgarian market. That is why 99.99% of the liquid is being exported. Most of the production is being bought by leading European companies from Germany and Switzerland, France. It is a public secret that Bulgarian producers export raw materials for iconic cosmetic companies such as Nina Ricci, Coco Chanel, Christian Dior, and others. Every year requests for Bulgarian rose oil

from the US and Australia are increasing. These are the new raw material markets. Traditional demand is also coming from the Far East and the Arab region.

Article by Dragomir Nikolov
Translated from Bulgarian – Konstantin Tzvetanov