AVAILABILITY AND TECHNICAL ASSESSMENT OF TRACTOR PURCHASING POWER AMONG FARMERS IN CEFTA COUNTRIES

Abstract

The tractor is a key driving unit in modern agricultural production. This study explores the possibilities and capabilities of farmers in Bosnia and Herzegovina (BiH) compared to other CEFTA members in purchasing an adequate, quality, and suitable new tractor. The research analyzes the process of trade liberalization in Southeast Europe, including the Agreement on Amendment and Accession to CEFTA. The study covers an analysis of ten global tractor brands across 110 different models that are available in CEFTA countries market. The average tractor prices and prices per kW of power were calculated by brand, and a brendization (according to the Analytical Hierarchy Process method (AHP)) into three groups: A, B, and C was performed. The research results showed that New Holland brand tractors are the most expensive, while Foton brand tractors are the cheapest. In terms of price per kW, Ferrari brand tractors are the most expensive, while ArmaTrac brand tractors are the cheapest. Differences in the purchasing power of farmers in BiH compared to CEFTA members were also analyzed, with a focus on differences in average salary in countries across three years (2018, 2019, and 2020). The purchasing power of farmers was determined by calculating the purchasing power coefficient (PPC), which showed that farmers from Serbia and farmers from Montenegro have the highest purchasing power for all examined tractor brands, while Moldova is the weakest by this indicator, and theoretically, farmers do not have the ability to purchase tractors of any examined brand. Farmers from BiH do not have the purchasing power to buy Kubota and Ferrari brand tractors but have the purchasing power to purchase Foton, ArmaTrac, and Case brand tractors.