Albania - Food Processing

Food processing

Albania's food-processing industry had at least one processing facility for the cereal, meat, and dairy branches in each of the country's twenty-six administrative districts without regard to efficiency or economies of scale. These facilities, which employed about 25,000 people, relied on the Ministry of Light Industry to allocate raw materials, arrange transportation, and market products. Years of depreciation and inadequate investment had left the 200 largest food-processing enterprises and about 750 smaller plants with obsolete, broken-down equipment. As a result, managers had little experience in obtaining materials or marketing, and the plants functioned inefficiently and produced low-quality goods. Minimal hygiene and sanitation standards went unmet. Shortages of raw materials and spare parts, along with transportation problems, forced many food-processing enterprises to curtail operations; in 1991 alone, output fell 35 percent from the previous year. When the government loosened controls on food and vegetable prices in 1991, the official marketing network collapsed, cutting off the supply of raw materials to the country's thirty-one canneries. As unofficial prices rose, supply flows to the twenty-seven state-owned slaughterhouses dried up. The thirty-two district-level and 550 village dairies survived only by paying unofficial prices for milk and cooperating with private traders.

Albania's thirty-eight flour mills normally employed between thirteen and 257 people and could grind between eight tons and 160 tons of flour per day. The seventy state-owned bakeries in urban areas produced about 370,000 tons of bread annually. The government privatized many of the country's village bakeries, which had a 200,000-ton total annual production capacity. Albania's lone modern yeast factory could produce about 600 tons annually, which was inadequate to meet the country's needs. Albania had ten pasta factories and two starch factories. Freemarket prices four times higher than official levels left state-owned mills and bakeries unable to compete with private millers and bakers for available grain supplies.

State-farm managers and private farmers radically reduced the amount of hectarage producing oilseed, cotton, and tobacco because state prices were low and there were no private markets offering higher prices. Tobacco and sugar-beet production decreased less drastically because state enterprises, including the Durrės tobacco factory and the country's only sugar-beet refinery, offered farmers advance purchase contracts at relatively attractive prices. Albania's vegetable-oil industry consisted of twenty-seven olive-oil plants capable of pressing 755 tons of olives daily; eleven sunflower-oil plants with a daily capacity of 262 tons of seeds; seventeen oil-extraction plants with a daily capacity of 270 tons of olive, cotton-seed, corn, and sunflower pulp; and ten obsolete oil-refinery units with a daily capacity of 110 tons of sunflower oil and soya oil. Town and district plants bottled edible oils. The country also had four soap factories and one margarine plant.

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