Organization of the dairy industry in Europe. Overview

Transcription

1 Organization of the dairy industry in Europe Overview Clotilde Patry, Xavier David, Didier Boichard, Eric Venot, Vincent Ducrocq, 06/05/2014

2 _01 Contribution of EU in the dairy worldwide market C.PATRY, 06/05/14, Uberaba, Brazil.02

3 Milk production in the world Cow milk production (Millions of tons) NA: 95 13% CA: 16 2% SA: 61 30% BRZ: 29 EU: % EU-27: % Asia: % NZ: 26 4% Total world > 770 millions of ton (all species) Source: FNCL

4 Global consumption Cheese, butter, WMP, SMP, Whey powders consumption 79 % of the global production, 57% of the consumption

5 Europe: Production and consumption Milions of tons Production 156 Delivery 141 Imports 1 Figures in 2013 (EU-28) Exports 16 (10%) Domestic consumption 142 (90%) Consumption (kg / inhabitant) 279 Source: Economie de l élevage, 2013, IDELE

6 Dairy products in Europe 2013: How milk deliveries were used (% of the Dry Useful Matter) owders Cheese Source: Economie de l élevage, 2013, IDELE 2 markets: 1. Home consumption and Europe: Very saturated (cheese) 2. Export towards emerging countries A high demand(milk powder) Dairy processing in the economy: 12,000 milk processing sites 10% of the people working in the European food and drink industry 13% of the turnover for the total food and drink industry in Europe.

7 External trade of dairy products 10% Limited import: < 1% of the EU consumption Cheese from Switzerland Butter from NZ Increasing export: 9,2 Mrds (28,7 Mrds $R) Cheese (40%): EU = the exporter 1st worldwide Milk powder (30%) Whey powder (10%)

8 EU: one of the major exporters 10% Export (Millions of tons of milk) Few international exchanges Source: IDELE

9 EU: world market share 30% 20% Source: EU commission

10 _02 The specificities of the dairy industry in Europe A common political framework C.PATRY, 06/05/14, Uberaba, Brazil.010

11 Regulated milk market in the EU 1984: implementation of a quota system by the Common Agricultural Policy Every member state has a national production quota distributed to farmers. Whenever a member state exceeds its quota, it has to pay a penalty to the EU (0,3426 / L) Objectives: - Limit the continuous increase of the Milk Production, - Balance between consumption & production, - Reduce the EU supports (storage intervention, export refunds, special marketing aid)

12 End of the regulated milk market in the EU 2005: decrease of the penalty level 2009: Health Check reform national quotas increased by 1% every year April 2015: expiration of the quota system liberalization of the production

13 Evolution of EU milk deliveries and direct sales vs quotas Source: EU, DG Agri, H. Versteijlen

14 Impact on prices and competitivity average European milk (raw) prices / 100 kg 40,00 35,00 30,00 29,67 36,51 25,00 20,00 Source: Milk market observatory

15 Impact on prices and competitivity Source: EU, DG Agri, H. Versteijlen

16 _04 The specificities of the dairy industry in Europe Diversity of structures: farm, delivery, process C.PATRY, 06/05/14, Uberaba, Brazil.016

17 Milk production: different volumes, various farming systems Very specialized farms: -Pasture oriented: IRL, GBR Large herd size, low production costs but milk production seasonality -Inbarn feeding: NLD, DNK, Germany (East) Large herd size, concentration of the services, large investments, high productivity -Mountain area: France Local products with high added value Farms (associated with other agricultural activities), smaller herd size Ex: France, Germany (West) Autonomous / Feed but high production costs Milk deliveries per country (Millions of tons)

18 Dairy processing industry: different strategies 5 out of the TOP 10 global dairy industry are European 80% of the EU dairy companies are SMEs In the North (NLD, DNK): Monopolistic cooperatives with more than 80% of the market share France, Germany, GBR, IRL: many more stakeholders International leader (private) Cooperatives SMEs (local products)

19 Strengths and challenges of the European dairy industry Strengths: Well structured dairy sector Diversity & complemtarity: market diversity Quality: Genetics, Hygiene, Nutrition Environment & animal welfare concern

20 Strengths and challenges of the European dairy industry Challenges: Volatility of the milk price and the intrants and the revenue Competition with cereals and biofuel Societal expectations: Environment, Animal health & welfare Precise dairy farming: need for investment in research Needs of the farmers community - Farmer population getting older: replacement? - Need for training

21 _05 The European dairy industry: what s next? C.PATRY, 06/05/14, Uberaba, Brazil.021

22 Dairy product consumption increasing steadily Source: European Dairy Assocation 2012, as calculated by IDF

23 Production vs consumption: need for more international exchange surplus balance deficit

24 How the EU commission see the future? After the milk quota abolition: Number of dairy cows (millions) % Yield (kg/dairy cows) % Production (millions of tons) % Milk price( /t) % Source: DG AGRI /OCDE, Fao et World Bank

25 Need for adaptation At the farm level: - More specialised and integrated farms - Take advantage of the diversity (production, genetics, processing) to adapt to various markets At the industry level: need for enterprises with a capacity of: -Innovation: products, marketing -International development

26 Conclusion So far, Europe is among the leaders in the dairy sector A changing context: increased demand increased competition (market liberalization) Adaptation: need and capacity Modern production and processing tools Cooperative organization Diversity of the practices, complementarity Towards more international development

27 Thank you for your attention! Obrigada