Algerian farmers struggle to exploit price boom

By Lamine Chikhi

SETIF, Algeria (Reuters) - High world grain prices should make this a golden age for Algerian wheat farmers, but a legacy of mismanagement means the former Mediterranean farming superpower is struggling to regain its lost agricultural glory.

Erratic rainfall is a perennial threat and weeks of drought this year will likely hit cereals output in a country that is already one of Africa's top food importers.

But it is administrative and policy flaws that pose the bigger menace, say farmers.

They complain of a lack of financial support despite well-intentioned government efforts to reverse a history of neglect and a debilitating reliance on oil and gas in the north African country.

Farming provides work for around 25 percent of those of working age in the 33 million-strong population, and accounts for about 10 percent of the OPEC member's $110 billion gross domestic product.

But agricultural productivity is low with Algeria harvesting less wheat than Egypt on three times as much land.

Farmer Achour Slimani stands in a parched wheat field of stunted plantings and echoes a complaint common among his peers.

"The banks refuse to provide loans to farmers. They support importers and industrialists, but never farmers," said Slimani, part-owner of a 134-hectare (330-acre) field in Ouled Yellis near Setif town at the centre of the main wheat plains.

"You can't build agriculture without an efficient banking system," he said.

In a major policy speech in February, President Abdelaziz Bouteflika said Algeria should devote more land to food, including cereals, more land should be irrigated and greater efforts made to prevent desertification.

But he did not directly address one of the main constraints cited by cereals farmers -- access to loans. Inflexible credit means farmers cannot invest and banks often cite lack of title as a reason to refuse loans, farmers say.

The issue is critical because 62 percent of farmed land is private smallholdings where farmers usually lack title to the assets that would qualify as collateral, official figures show.

The remainder is state land, managed in many cases by private farmers under long-term concessions.

"We have cultivated wheat since the Romans, but a majority of farmers don't have title to property," said Lahcene Lamri, secretary general of the Setif chamber of agriculture.

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