Food Industry Study in Southeast Europe Final

Transcription

Food Industry Study in Southeast Europe
Final Report
Southeast Europe
Presented to
Deutsche Investitions- und Entwicklungsgesellschaft, DEG
December 2010
Your contact person
with GFA Consulting Group is
Inge Gärke
Food Industry Study
in Southeast Europe
Final
GFA Consulting Group GmbH
Eulenkrugstraße 82
22359 Hamburg
Germany
Telephone
0049-40-60306-170
Telefax
0049-40-60306-179
E-Mail
[email protected]
T AB L E O F C O N T E N T
FOREWORD
I
1
OVERVIEW ON THE REGION
1
1.1
General overview
1
1.2
Sub-sector overview
3
2
FOOD INDUSTRY IN THE DIFFERENT COUNTRIES
9
2.1
Serbia
9
2.2
Croatia
18
2.3
Bosnia and Herzegovina
25
2.4
Moldova
30
2.5
Albania
36
2.6
Kosovo UN Res. 1244
42
2.7
FYR Macedonia
47
2.8
Montenegro
53
ANNEX:
Bib lio gra p h y a n d in te re s tin g Lin ks
L IS T O F AB B R E VIAT IO N S
APF
Agricultural Policy Forum
BAM
Bosnia-Herzegovina Convertible Mark
BAS
Business Advisory Services
BiH
bln
Billion
BMELV
German Ministry of Food, Agriculture and Consumer
Protection
CEFTA
Central European Free Trade Agreement
CeProSARD
Centre for promotion of sustainable agricultural practices and
rural development
CPI
Corruption Perception Index
DEG
Deutsche Investitions- und Entwicklungsgesellschaft mbH
(German Investment & Development Company)
EBRD
European Bank for Reconstruction and Development
EFSE
European Fund for South East Europe
EIB
European Investment Bank
ETC
Early Transition Country
EU
European Union
EUR
Euro
FAO
Food and Agriculture Organisation
FDI
Foreign direct investment
FYR
Former Yugoslav Republic (of Macedonia)
FTA
Free trade agreement
F&V
Fruits and vegetables
GAP
Good Agricultural Practices
GDP
Gross domestic product
GFFA
Global Forum for Food and Agriculture
HACCP
Hazard Analysis Critical Control Point
HQ
Headquarters
HRK
Croatian Kuna
IFC
International Finance Corporation
IFI
International finance institution
IPF
Infrastructure Projects Facility
ISO
International Organization for Standardization
KfW
Kreditanstalt für Wiederaufbau
MCC
Millennium Challenge Corporation
MDL
Moldovan Leu
MKD
Macedonian Denar
mln
Million
n/a
Not applicable
OA
Ost-Ausschuss der Deutschen Wirtschaft
(Committee on Eastern European Economic Relations)
OMV
Ost- und Mitteleuropa Verein e.V.
(East and Central European Business Association)
PET
Polyethylenterephthalat
SD
Serbian Dinar
SEE
South East Europe
SEEC
South East European Countries
SME
Small and medium enterprises
SWG
Standing working group
SWOT
Strengths, weaknesses, opportunities, threats
TAM
Turn Around Management
TC
Technical cooperation
UHT
Ultra-high temperature processed
US(A)
United States (of America)
USAID
United States Agency for International Development
USD
US Dollar
VAT
Value added tax
WTO
World Trade Organisation
FOREWORD
DEG as the private investment daughter company of KfW seeks to boost private
investments in the region South Eastern Europe, in order to assist long-standing
economic growth and modernisation of the food industry in these countries.
DEG has contracted GFA Consulting Group GmbH to summarise information from
existing studies and information on the food industry in eight (8) countries in South East
Europe (Albania, Bosnia and Herzegovina (BiH), Croatia, Kosovo UN Res. 1244, FYR
Macedonia, Moldova, Montenegro, and Serbia), with a particular view on identifying
potential larger-scale investment opportunities.
From October to December 2010, GFA has conducted a review of existing studies and
exchanged with experts and organisations (investment promotion agencies, trade
chambers, etc.) during short visits to the countries. Besides the core team of Inge
Gaerke, Sigrid Giencke, Zoran Kapor and Conrad Hoyos, we have involved the following
local short-term experts: Nikola Karabasil (Serbia), Ana Marusic Lisac (Croatia), Ardian
Marku (FYR Macedonia), Edin Focis (BiH), Aida Nani (Albania), Oleg Stipca (Moldova),
and Fatmir Selimi (Kosovo). Further, we would like to thank the various interviewed
persons as well as Gabriele Wäschle & Kathrin Matzen for final editing.
i
1
OVERVIEW ON THE REGION
1.1
General overview
Overall, there is a population of approximately 28 million inhabitants in the 8 SEE countries. In
the following, we have presented the 8 countries not in alphabetic order, but in order of the size
of their population. The size of the population as well as GDP per capita, the income distribution
and consumption patterns determine the size of the potential local food market.
Ser
Cro
BiH
Mol
Alb
Kos
Mac
Mon
Population (million)
7.3
4.4
3.9
3.6
3.2
2
2.0
0.6
Land (mln ha)
8.8
5.6
5.1
3.4
2.9
1.1
2.6
1.4
Agricultural land
5.1
3.2
2.2
2.5
1.1
0.5
1.2
0.5
Arable land (mln ha)
4.2
1.2
1.1
1.8
0.6
0.3
0,5
0.05
30.5
45.4
12.1
3.9
7.9
3.8
US$
4.48
3
4,093
12,630
3,159
1,085
2,491
1,731
3,280
4,500
1.5
-1.5
0.5
3.2
2.6
4.6
1.2
-1.8
Contrib. F&A to GDP
~18%
~13%
~10%
~ 30%
~21%
~7%
~10%
~8%
Contrib. F&A to
Exports (%)
~23%
~11%
~6.3%
~ 65%
~16%
~16%
~11%
~11%
Corporate tax
10%
20%
10%
0%
10%
10%
10%
9%
VAT
18%
23%
17%
20%
20%
16%
18%
17%
8%
0%
17%
8% or
lower
20%
16%
5%
7%
34
33
27
31
45
28
16
29
~500
~1000
~600
~200
~ 250
~200
~400
~ 400
Rank CPI,
(Transparency)
78
62
91
105
87
110
62
69
Rank Ease of Doing
Business, Rank
89
84
110
90
82
119
38
66
Rank Global
Competitiveness
96
77
102
94
88
n/a
79
49
GDP total
(bln €, 2009)
GDP/capita (€, 2009)
GDP growth
(est. 2010, IMF)
VAT reduced /
basic food
Tax burden (% tax &
duties in company
profit, 2008)
Gross wage/
month (€)
CEFTA
x
x
x
x
x
x
x
X
EU accession status
Pot.
Cand
Cand
Pot.
Cand.
_
Pot.
Cand.
Pot.
Cand
Cand.
Pot.
Cand
WTO membership
-in
negot.
Since
2000
-in
negot.
Since
2001
Since
2000
-
Since
2003
- in
negot
Note: F&A = food and agriculture
Food Sector Study South Eastern Europe - 1
The food and agricultural sector is still very important in the region, contributing significantly to
GDP and to exports of the countries. However, most of the countries are net importers of food
and agricultural products, contributing to the large trade balance deficits that the countries are
facing. The sector is important for its contribution to overall employment, bearing in mind that
generally, unemployment is quite high in these countries and has considerably increased since
the global financial crisis. On the other hand, there is a strong tendency of rural depopulation in
these countries, leading even to some seasonal labour shortages in rural areas, and also
leading to a certain percentage of uncultivated land.
All 8 SEEC are parties to the Central European Free Trade Agreement (CEFTA), which
entered into force in 2007 (see www.ceftatradeportal.com). CEFTA has the purpose of removing
trade barriers (tariff and non-tariff barriers); however, the process is still ongoing.
The EU has established a Western Balkan Trade Pact, which was extended in October 2010.
According to this, almost all products from the Western Balkans can be imported customs free.
For some products such as wine, baby beef and certain fish products, there are preferential
tariff quotas. So far, the import quotas have often not been used fully.
Some of the countries have bilateral trade agreements, e.g. Serbia with Russia, Kosovo with
the US, which also offers opportunities for customs-free export outside CEFTA and the EU.
Advantages of the region regarding investments in the food industry:
•
28 million consumers live in the region (~55 million in the wider region including Romania
and Bulgaria).
•
Political situation is stabilized and the economies show a long-term growth trend.
•
Number of larger supermarkets with growing demand for reliable, standardised local supply
is increasing (‘retail revolution’).
•
Number of larger processing companies with modern quality management systems
(HACCP, ISO) is increasing.
•
Mergers and acquisitions will continue in the region, in particular in the retail sector and in
enhancing vertical integration within the value chain.
•
Consumption patterns are changing (less domestic production).
•
There are considerable infrastructure and agricultural investments planned in the frame of
EU accession or EU neighbourhood.
•
Investments into domestic production can contribute to reducing trade balance deficits
(most countries are still net importers of food).
 Opportunities on local markets exist.
•
All 8 countries are parties of CEFTA (Croatia only, until it enters the EU).
•
These countries are EU candidate or potential EU candidate countries (except Moldova)
resulting in a need of the food industry to comply with EU regulations and to increase
competitiveness towards EU companies.
•
Customs-free access to EU market (EU-Western Balkan Trade Pact).
•
Additional bi-lateral free-trade agreements allowing customs-free access to further markets
(e.g. Serbia with Russia).
 Opportunities for exports to the region, to EU, and other markets
(in particular wine, fruits and vegetables, niche products) exist.
Major Challenges / Risks remain:
•
Fragmented primary production leading to limited quantities of raw materials, higher costs of
primary production, quality control and logistics (in particular for milk)
•
There are only a few larger processing companies, all others are small to medium-sized and
productivity is often lower than in EU countries.
•
Oligopoly structures in the retail sector lead to less negotiation power of suppliers.
•
Even if quality management has improved during recent years, there is still a need for
further improvement.
•
Some countries have not yet fully established the food safety system to export to the EU
(which is in particular relevant for export of products of animal origin).
•
Logistics and Marketing are not yet so well developed.
•
Croatia will face strong competition, upon entering the EU.
•
Low purchasing power of the local population (the region is expected to need longer for
recovery from the financial crisis, and faces increasing unemployment).
•
Strong depopulation of rural areas leads partly to labour shortage in rural areas.
Most interesting countries for larger investment (>1 million EUR) in the food industry are
Serbia and Croatia, followed by FYR Macedonia. Further, Moldova and Bosnia and
Herzegovina can be interesting for larger scale investments if the regulatory environment further
improves. In Albania, Montenegro and Kosovo, there is only limited potential for larger
investments as most companies in the food sector are small.
As there is currently a concentration process ongoing with strong acquisition activities of
larger holdings (e.g. Agrokor, Croatia; Delta, Serbia) or investment funds (e.g. Danube Food
Groups / Salford), the assessment of the sub-sectors is becoming less relevant than the
selection of the right conglomerate.
Potential investments can be for the following purposes:
•
Mergers and acquisitions;
•
Expansion on the domestic and regional market (e.g. new retail markets);
•
Expansion of production facilities (e.g. cooling, freezing, processing, new production lines);
•
Modernisation of production facilities (e.g. to improve productivity, to improve quality, to
improve energy efficiency);
•
Logistics, packaging
trucks/vehicles).
and
marketing
(e.g.
1.2
Sub-sector overview
1.2.1
Retail and wholesale
logistic
centres,
storage,
packaging,
During the last years, the region has experienced a ‘retail revolution’. Supermarkets and
hypermarkets have been opened, and consumption has strongly shifted from smaller shops and
groceries to supermarkets. This trend seems to have been accelerated during the food price
crises in 2008 and the financial crisis in 2009. Supermarkets and hypermarkets were specifically
offering discount foodstuff to attract customers looking for good bargains during difficult times.
Another trend during the last years was that some larger retailers have grown constantly
(through investments and acquisitions) and are now determining the market. As food sales are
increasingly through supermarkets and hypermarkets, retailers are also getting increasing
power over manufacturers and can, for example, increase shelf prices.
Most of the retailers started in the capital cities and larger towns, but also extended now to
smaller cities. Mergers and acquisitions are quite common and frequent. In some countries,
there are market entry barriers for e.g. foreign retail chains, with a tendency to strong oligopoly.
Products in these supermarkets are still often imported. However, step by step, imported
products are also replaced by products from increasingly strong and reliable local suppliers,
who are able to deliver the needed quantities in the qualities (ISO, HACCP), and packaging
required. The need for processors to grow and to modernise will further increase, as
supermarkets do not want to buy from a large number of smaller producers. Some retailers also
invested in companies with own processing facilities and sometimes even primary production.
Establishment of ‘private label products’ (e.g. Premia / Delta) are also increasing, often through
supply contracts.
Some countries have been trying to force retail chains to offer a specific percentage of local
products of the overall products (Serbia, BiH), but this does not seem to be conform to EU
regulation on open competition. However, there may be a raising interest to raise public
awareness about ‘buying local/regional’, which may lead to stronger market pressure on the
supermarkets to search for and develop local supply.
Fast food chains are not expanding with such as speed as it was seen in Eastern Europe. So
far, there are some McDonald, Pizza Hut, KFC branches, but not in a significant number. South
East Europe has a tradition and established companies with own fast-food products (e.g. bakery
products/burek, pizza, cevapcici, etc.).
Market opportunities exist:
• New retail markets in smaller towns outside the capital cities;
• New retail markets in those countries, where the market is not yet saturated (e.g. Albania,
Kosovo);
• Sale through mini-markets in the centres and/or in residential areas.
Investments have taken place and may further take place in the area of:
• Expansion through mergers & acquisitions in the domestic market and in the regional
market;
• Green field investments (new supermarkets, hypermarkets, discount markets);
• Acquisition of small shops to establish chains of mini-markets;
• Acquisition of companies with processing facilities;
• Establishment of ‘private labels’ of the retail chains.
In some countries, saturation of the retail market is almost reached. In those cases, acquisitions
are more common than new green field investments.
1.2.2
Wine industry
During the last years, larger private companies have developed, either:
• via privatisation of state-owned companies,
• via expansion of existing smaller vineyards and processing facilities,
• via green field investments by local companies.
Some vineyards and wineries are still not yet privatised (e.g. 13 jul Plantaze, Montenegro, and
some of the Kosovo wineries).
In most of the eight countries, the wine industry is strongly protected via high import duties (e.g.
45-50% in FYR Macedonia). Main risk is that imports may flood the domestic and regional
markets, once import tariffs decrease.
Some countries are traditional exporters of wine (e.g. FYR Macedonia, Moldova), but the export
is mostly in bulk. During the last years, modernisation and investments have taken place.
Certifications such as ISO 9000:2001 and HACCP have been introduced, and a number of
wines from the regions received awards and prices.
Market opportunities exist:
• on the domestic market to a certain extend (more consumption is expected with increasing
disposable income, sale through supermarkets is expected to increase, i.e. wine of high
brand recognition and medium to low prices);
• on the regional export market, in particular Serbia;
• on other export markets (in particular EU) based on increasing information about the quality
wine from the region, and facilitated because of preferential trade agreements.
Investments have taken and may further take place in the area of:
• Privatisation (acquisition of former state owned wineries) and other merger & acquisition;
• Investments in wine processing facilities mostly coupled with investments in vineyards
(primary production);
• Investments in wine tourism / rural tourism / wine festivals;
• Investments in wine shops.
1.2.3
The region has favourable climate and soil conditions for fruit and vegetable production. As this
production is also labour intensive, the relatively low labour costs are playing in favour of this
sub-sector. Often, fresh or frozen products are exported; processed products are still mainly for
the domestic and regional markets with some exceptions. Main fruit exporter in the region is
Serbia, main vegetable exporter is FYR Macedonia.
Fruits: Serbia is the world’s third largest producer of raspberries, and is also known for its sour
cherries, blackberries, blueberries, apples and plums. Montenegro is producing peaches and
mandarins on larger scale, peaches on the 13 jul Plantaze, and mandarins on private farms in
the South of the country. Fruits are processed often into juices, jam and marmalade or frozen
(e.g. in Serbia or Macedonia).
Vegetables: The region is strong in vegetable production and processing. Vegetables are often
sold as fresh products (in particular for early production). Increasingly, freezing facilities are
available, and fresh frozen products are exported. Processed vegetables are mainly based on
tomatoes (e.g. ketchup), pepper/paprika (e.g. Ajvar, Lutenica), and potatoes (e.g. chips). Potato
production and processing seems to become more important, in particular for supply to local
and/or international fast food chains. FYR Macedonia is the main exporter of fresh and
processed vegetables in the region. The climate is favourable and allows greenhouse
production without heating. Exports are mainly going to Serbia, Croatia, Bulgaria, some also to
the EU. However, the competition of countries with similar climate, but with modernised
production and processing structures and well developed logistic systems (Turkey, Greece,
Italy, Spain, etc.) is strong.
Organic farming: There is a great hope that organic farming and export of organic products will
be interesting. However, this may well remain niche area, as even for organic farming, large
production sizes are needed in order to stay price competitive and to assure a regular supply
with standardised and certified products in sufficient quantities.
Market opportunities are in the area of:
•
Sale of fresh and frozen products (in particular fruits from Serbia and early vegetables from
Macedonia) on the domestic, regional, and - to a certain extent – on the EU market and
other markets outside CEFTA and EU;
•
Processed vegetables (in particular specialised products such as Ajvar and Lutenica,
soups and other finished meals) for domestic and regional market;
•
Processed fruits (in particular juices, jam) for the domestic and regional market;
•
Meal solutions (soups, microwave products);
•
Organic products for export (if sufficient quantities).
Investments have taken place and can further take place in the area of:
• Freezing facilities, storage, packaging;
• New facilities for fruit processing (juices, jam, etc.);
• New equipment and production lines for vegetable processing (e.g. for production of potato
chips or French fries);
• Greenhouse primary production;
• Modern irrigation systems (e.g. in Macedonia, Moldova), mostly with public investment
support.
However, investments – besides large public funded irrigation investments - are usually
relatively small (smaller than 1 million EUR) and may also stay relatively small in the future.
1.2.4
Beer and other beverages
Beer was the first area towards foreign direct investment in the food industry was directed in the
1990s. Thus, most large breweries belong now to international chains or investment groups.
The soft drink market is also dominated by international companies, who have invested in local
bottling facilities. However, some local companies have also entered this market segment in the
last decade. Fruit juices are increasingly interesting, and often produced and distributed by local
companies. Bottled water has attracted strong interest during recent years, in particular in BiH
and Montenegro, where there are large quantities of good quality water in the mountainous
areas.
Market opportunities:
• Bottled water;
• Fruit juices (100% fruit content);
• Specialised beverages (energy drinks, sport drinks, protein mixtures).
Investments have taken place and may further take place in the area of:
• New facilities for bottled water;
• Mergers and acquisitions;
• Modernisation of facilities;
• New production lines for fruit juices;
• Product development (e.g. energy drinks);
• Packaging (PET, Glass, etc.);
• Marketing and distribution.
1.2.5
Meat sector
Meat processing went through a modernisation and growth period. Most of the larger
processors have nowadays modern quality management systems (ISO, HACCP), and some
companies also have Halal certificates (e.g. in BiH) or Gost-R (e.g. in Moldova, Serbia), the
latter being important for export to Russia. Most of the production is aimed at the local market
(import substitution). Besides the domestic market, the regional market (CEFTA) is of growing
importance, and the export of some special products (lamb meat, smoked ham) to EU partners
and abroad. However, the fragmented primary production leads to insufficiencies in raw material
supply.
Market opportunities are in the area of:
• Domestic and regional market;
• Export of lamb meat and baby beef (EU import quota for baby beef);
• Export of specialised products (sausages, smoked ham).
Investments have taken place and may further take place in the following areas:
• Building and equipment of new slaughterhouses or modernisation and equipment of existing
processing facilities;
• Building and equipment of new processing facilities or modernisation and equipment of
existing processing facilities;
• Trucks (with and without cooling) and other transport means;
• Logistics centres;
• Packaging;
• Retail outlets (specialised on meat);
• Quality management systems.
A risk is still whether the local meat producers will be able to be price competitive in the long
run. In some cases, the meat sector is protected (import duties or market barriers for foreign
companies) leading to relatively high retail prices for meat products. If those barriers may
become lower, local processors can face more intensive competition.
1.2.6
Milk
Primary production is extremely fragmented in the region, leading to high costs of production,
collection and quality control. Productivity per cow is slowly increasing in all countries; however,
the milk production per cow is still 50% below the EU average. Local dairies are often relatively
small. During the last years, restructuring in this subsector can be observed with more and more
international companies taking over local dairies (e.g. Meggle, Danone, Lactalis).
Market opportunities are in the area:
• Domestic and regional market;
• Fresh milk, UHT milk;
• Cheese for local taste;
• New products (e.g. drink yogurt with fruits).
Investments have taken place and may further take place in the following areas:
• Merger & Acquisition;
• Expansion of capacities (processing, cooling);
• Trucks, logistics;
• New product development, new production line (e.g. goat cheese, feta cheese, mozzarella,
fruit yogurts);
• Packaging and marketing.
However, as primary production costs are high, this sector is seen as a risky one.
1.2.7
Other Sub-sectors
Bakeries / Flour Mills / Edible Oil
There is a potential for further investments in bakery products / pastry, mainly for the domestic
market. In particular BiH and Moldova have a wide variety of bakery products.
Serbia is strong in the production of edible oil, and may further develop the local and export
markets.
Confectionery / snacks / ready-made meals
There is a potential for investments in confectionery, snacks and ready-made meals, as this is a
strongly growing market. However, as it demands strong marketing/distribution and product
development capacities, it may be in the long run only relevant for larger companies with wellestablished brands, as it is otherwise difficult to compete against brands from the EU.
Sugar industry
Sugar beets are produced in Serbia, Croatia, Moldova, and partly in BiH. The processing is
dominated by large international companies (e.g. Südzucker in Moldova, Hellenic Sugar in
Serbia, previously also Nordzucker in Serbia). On the one hand, Europe in general has
difficulties with price competitiveness since the liberalisation of the sugar market. On the other
hand, recent price increases in sugar have made the sector again more interesting. Potential
investment opportunities in the sugar industry have to be analysed on a case-by-case basis, as
there are only a few large players in the sugar industry.
Niche markets:
Most of the niche markets are too small for larger investments above € 1 million. However, there
may be exception that could be worthwhile examining more closely, such as:
•
•
•
•
•
Nuts (Moldova)
Fish (Croatia, Serbia, BiH)
Smoked ham (Montenegro)
Herbs and spices (Albania, Serbia, BiH)
Mushrooms (Serbia, Croatia, FYR Macedonia)
Packaging:
Most of the packaging material is imported (e.g. Tetra Pack, carton boxes). In Moldova and
Serbia, there are larger glass factories. Foreign investments in (re-)packaging can be found in
Albania as well as in Croatia due to growing demand. Besides these, there is a number of
smaller packaging production (e.g. wooden boxes, cartons) and some re-packing facilities (e.g.
by agricultural input suppliers). Investments in the packaging industry may be in energy
efficiency measures (e.g. in glass factories), in packaging and re-packaging facilities combined
with logistic centres, in carton and wooden box production, and in PET production. Larger scale
production with economies of scale is important.
2
FOOD INDUSTRY IN THE DIFFERENT
COUNTRIES
2.1
Serbia
2.1.1
Food and Agricultural Sector
Serbia is the largest market in the region with a long tradition in agriculture and a favourable
climate. The agricultural sector plays a major role in the Serbian economy accounting for 18% of
GDP and 23% of exports in 2009. Cereals, raspberries and sugar are the leading export
products. Net exports of food and agricultural products reached over 600 million EUR in 2009.
The food processing industry has strongly developed and grown during the years of transition.
However, primary production is still very fragmented. Of the approximately 5 million ha of
agricultural land, 90% are in private ownership. Agricultural holdings have mostly less than 50
ha of land. Private farms have an average size of < 3 ha.
In Serbia, as well as in Croatia, a trend in the food industry is the expansion and growth of
conglomerates which are active in several sectors. The largest is Delta Holding, which consists
of 30 dependent companies in various sectors, also active internationally in Bosnia and
Herzegovina, Montenegro and Bulgaria. The second largest conglomerate in Serbia is Victoria
Group, mostly present in the agriculture industry, the chemical industry and the financial
services industry. Slightly smaller is Invej, which in its diversified business. The fourth major
conglomerate active in agriculture is MK Group which is operating in the fields of agriculture,
food, trade, logistics, renewable energy sources, real estate and financial services.
Aside from conglomerates from Serbia, some non-Serbian based holdings are also worthy of
mention. East Point Holdings Ltd. is a Cyprus based company (part of Point Group) in
wholesale grain trading including milling and bakeries. The Danube Foods Group (DFG)
operates mainly in the food sector in Serbia and the region. Other large holdings in the Serbian
food sector are Atlantic Group (Croatia) through acquisition of the Slovenian Droga Kolinska
and Agrokor (Croatia).
Sub-Sectors
Retail & Wholesale
Fruits and
Vegetables
Confectionary
Bakery
Flour mills et pasta
Edible oil production
Wine
Meat processing
Larger Companies (ownership)
Delta M (part of Delta Holding)
Mercator (Slovenia)
Metro Group
Idea (Konzum – Agrokor, Croatia)
Univerexport (retail)
Nelt (wholesale)
PTP DIS (wholesale and retail)
DELTA DMD (wholesale)
FRIKOM (Agrokor)
Aleva
MONDI Serbia (MONDI Foods Group)
Soko Stark (Atlantic Group)
Bambi-Banat (DFG)
Pionir
Swisslion-Takovo
Marbo Product (Pepsi International)
“Klas” - Belgrade Bakery Industry (East Point Holding)
Fidelinka
Zitko (part of Verano Group)
Danubius (part of Delta Holding)
Dijamant (Agrokor)
Vital (Invej)
Sunce (Invej)
Vino Zupa
Rubin (Invej)
Carnex
Matijevic
Yuhor (Delta)
Neoplanta (Nelt Company)
Topiko (Perutnina Ptuj, Slovenia)
IM Topola
Sub-Sectors
Dairies
Sugar
Beer
Soft Drinks
Mineral Water
Hot drinks
2.1.2
Imlek (DFG)
Suboticka Mlekara (DFG)
Sabacka Mlekara (Farmakom MB Concern)
Somboled (Lactalis Group)
Sunoko (MK Group)
Crvenka (Hellenic Sugar Industry)
Sajkaska (Hellenic Sugar Industry)
Apatinska brewery (CVC Capital partners)
Carlsberg Serbia
Coca Cola HBC Serbia
Nectar (fresh juices)
Fruvita (juices)
Knjaz Milos (DFG)
BB Minaqua
Grand Prom (Atlantic Group, Croatia),
Doncafe (Strauss Group, Israel)
SWOT analysis
Strengths
•
•
•
•
•
Weaknesses
Serbia is the country of the region with the
largest size of arable land (5,1 million ha),
it has fertile agricultural soil and favourable
climatic condition, and an advanced agroindustry, in particular in Vojvodina.
Long tradition within the food industry.
Labour costs are relatively low.
Larger companies have invested into
expansion, modernisation and quality
management.
Serbia may soon get EU candidate status
(2011), leading to increased pre-accession
assistance and investments.
•
•
•
Opportunities
•
•
•
•
•
•
Fragmented primary production, leading
partly to higher production costs and low
technology in primary production.
Only a few brands are internationally
recognized.
Besides some larger companies, many
processors are still of small to medium
size in international comparison.
Threats
Large domestic market, as Serbia is the
country in the region with the highest
population (7.4 million inhabitants).
Export Opportunities, in particular for fruits
and cereals.
CEFTA member, and customs-free access
to EU market.
Free Trade Agreement with Russia (160
million consumers) and other countries.
Harmonization with the EU in process.
Possibility to lease state-owned agricultural
land.
•
•
•
•
•
•
Low purchasing power of domestic
consumers and high unemployment.
Dominance of larger players in the food
trade leading to lack competition.
Import tariffs will be reduced, which may
lead to increased imports of more price
competitive products (e.g. meat,
confectionery).
Liquidity planning is difficult due to delays
in payments.
Depopulation of rural areas (partly
leading to regional labour shortages).
Natural risks (floods).
2.1.3
Interesting Sub-sectors and larger companies
Retail & wholesale (food products)
Retail: The mass grocery retail sector in Serbia is expanding on a large scale, confirming the
“retail revolution” trend. The sector for retail of food products in Serbia over the last years has
been characterised by strengthening positions of the large Serbian players (Delta), and the
entrance of large regional players: several international players as Metro Group, Mercator
(Slovenia) and Konzum (Croatia).
•
Delta M Group is the largest division of Serbian Delta Holding conglomerate and retail
market leader. Delta owns several chains as the Maxi supermarket chain (Maxi Green
supermarkets, Maxi bakeries and an online Maxi E-Store), C-Market and Pekabeta. Delta M
also operates the cash-and-carry chain Tempo. Delta has registered operating revenues of
980 million EUR in 2009. Delta is also present in the region, opening retail stores in BiH,
with expansion in process in Montenegro and Macedonia. Delta is also active in Bulgaria
after taking over one of the largest Bulgarian retail chains Pikadili.
•
Slovenian Mercator has overtaken the former Serbian Rodic as the second largest retail
trader with registered operating revenues of 440 million EUR in 2009.
•
Croatian Agrokor Group, owner of Croatian market-leader Konzum, runs cash-and-carry
stores under the name Idea Super in Serbia. Konzum also operates a number of outlets in
the country, including Idea Mini, Idea Maxi and Idea Extra. Konzum is the third largest
retailer in Serbia with operating revenues of 360 million EUR in 2009.
•
Germany’s Metro Group opened six Metro cash-and-carry stores in Serbia with a turnover
of over 215 million EUR revenues in Serbia in 2009. According to Metro, the company’s
current investment in the market is 100 million EUR and further expansion is planned.
•
Serbian Univerexport is also one of the leading retail chains in Serbia with a retail network
including 30 retail stores, 5 wholesale stores and 3 subsidiary companies. Univerexport
registered 143 million EUR revenues in 2009.
•
PTP DIS is a whole sale trader, and has a retail market chain and an own food brand
“Dobro”. The company is characterized by a high rate of sales via internet. In 2010, DIS had
9 retail supermarkets. In 2009 the company had 158 million EUR revenues.
Wholesale: The wholesale sector in the food products is dominated by two companies:
Nelt and Delta DMD.
•
Nelt (~ €199 mln turnover in 2009) is a Serbian wholesale trader expanding quickly due to
distribution contracts with Procter&Gamble, Kraft Foods, Wrigley and SSL International.
Aside from international products, Nelt is also distributing domestic products. Nelt is also
operating in BiH, Montenegro and in Macedonia. The company registered.
•
Delta DMD (~ €125 mln turnover in 2009) is one of the leading distributors in the Serbian
market and is operating in Serbia and in Montenegro as part of the Delta M Group.
Meat processing and production
•
Raw meat production is decreasing. Serbia is a net exporter of meat products, but a net
importer of fresh meat and livestock. Most of the imported meat is processed in local
processing companies.
•
Major companies in the meat sector are Carnex (over €57 mln turnover of in 2009),
Matijevic (~ €118 mln turnover in 2009), and Yuhor (active in the market for over a century,
part of Delta M Group since 2004).
•
Further important companies are Agroziv (especially poultry meat), Industrija Mesa
Topola; and Topiko (poultry meat producer from Backa Topla which was bought in 2007 by
the group “Perutnina” from Ptuj, Slovenia); and Neoplanta (from Cenej, a small city in the
vicinity of Novi Sad.
Milk processing and production
•
The dairy sector is one of the largest agricultural sub-sectors by value in Serbia with
revenues of over 350 million EUR in 2008. Annual production of milk 1.7 million litres,
average milk yield increasing from 1,950 to 2,663 litres (1998-2007). Serbia is a net
exporter of milk and milk products. Most important export markets are the neighbouring
countries.
•
Dairies are all privatized, and there are now 36 industrial and 130 private dairies. The
sub-sectors is dominated by Danube Foods Group (DFG, part of the English investment
fund Salford) owning 15 dairy plants, including the two largest ones: Imlek (€203 mln
turnover in 2009) and Suboticka dairy (€69 mln turnover in 2009), covering 47.4 % of
the Serbian market.
•
The dairy plant Sabac (€46 mln turnover in 2009) is the only dairy plant in Serbia
completely owned by Serbian shareholders (Farmakom MB). The Somboled dairy plant
from Sombor (€36 mln turnover in 2009) has a 5.4% market share. The plant has been
acquired by Croatian dairy company Dukat, owned by the French Lactalis Group. The
dairy Mlekoprodukt Zrenjanin (€9 mln turnover in 2009) has a market share of 3.9%,
and is owned by the French firm Bongrain.
Cereals, flour mills, bakeries, edible oil production
•
Serbia has very favourable climate conditions for agricultural production with 4.2 million
ha of arable land (of the total of 5 million ha agricultural land). Over the last few years,
Serbia has established itself as a net exporter of cereals and edible oil. Agricultural
products are mostly exported to CEFTA countries, EU and Russian Federation. However,
most of the field crop production is with low yield, significantly below potential.
•
The leader in primary agricultural production is Delta Agrar (part of Delta M Group)
producing field crop, vegetables, fruit and cattle production. Other larger primary producers
are PKB (Poljoprivredna Koproracija Beograd), PIK Becej, and Mirotin, Vrbas (trade in
cereals, and production of cereals, edible oil, milk and milk products).
•
Flour mills: This sub-sector accounts for the largest number of producers in the whole food
sector. Amongst 25 larger companies, one of the largest ones is Fidelinka from Subotica
producing and trading cereals, flour and pasta. Other larger flour mills are Zitko, Backa
Topola (bought by the Serbian company Verano Group), Zitoprodukt, Zrenjanin (flour mill,
bakery, pasta producer and cereals trader), Danubius, Novi Sad (flour and pasta producer,
subsidiary of Delta M since 2007), and Kikindski Mlin (flour mill and pasta producer owned
by Agrokor).
•
The largest bread and bakery producers is the group Klas including Belgrade Bakery
Industry and Klas company. Second largest bakery is Hleb A.D, Novi Sad.
•
The Serbian oil and fats production is dominated by two major companies: Dijamant, and
Victoria Oil.
•
Dijamant is the largest edible oil producer and leading producer of margarines, vegetable
fats, mayonnaise and delicatessen in Serbia. Croatian Agrokor is the major shareholder.
The company had 112 million EUR in revenues in 2009.
•
Victoria Oil from Sid is part of the Victoria Group and produces raw and refined oils, protein
meal and biodiesel. The company registered 100 million EUR revenues in 2009.
•
In the sector of animal food production, two companies are in expansion: Sto posto
(animal food producer and importer of soya cake), and Gebi (specialized in import and
production of animal food, 35 million EUR turnover in 2009).
Sugar factories, sugar production
•
Areas under sugar beet are stable (around 60,000 ha) with a production of sugar beet of 2.8
million tons in 2009.
•
Sugar production is stable at around 430,000 tons. Domestic consumption of sugar
amounts to 240,000 tons (25-30 kg per capita), exports to 180,000 tons (mostly to the EU
within the customs-free export quota is 180,000 tons).
•
Major companies are:
o Sunoko (39.1 % market share, 116 million EUR turnover, major shareholder MK Group;
Source: InterCapital Securities, 2010). In the last years, Sunoko invested 13 million EUR
in four sugar plants.
o Hellenic Sugar Industry S.A. is a major shareholder in the sugar factories Crvenka (76
million EUR turnover) and Sajkaska (39 million EUR turnover) with a 38.9% of market
share.
•
Other large sugar plants are TE-TO (17.6% market share, 52 million EUR turnover, owned
by Italian Finanziaria S.I.I,) and Sugar + (4.4 % market share, 13 million EUR turnover,
owned by the Montenegrin company Roksped).
Fruits and vegetable processing and production
•
Fruits: Serbia is the world leader in raspberry production. Other key fruits are apples,
plums, blackberries and sour cherries (in total around 20 types of fruit). Premium quality of
berry fruits due to optimal climate and soil conditions (results in a higher dry content). More
than 300 companies are active in the fruit sub-sector in Serbia. The Serbian Investment
and Export Promotion Agency (SIEPA) supports a ‘Serbian Fruit’ database of market
participants (see: www.serbianfood.com).
•
Vegetable: Vegetables are grown on more than 10% of arable land in Serbia. Vegetable
crop production is characterized by small scale production primarily for individual needs.
The largest vegetable production centres are Leskovac, Nis, Aleksinac, Kraljevo, Čačak,
Ub, the vicinity of Belgrade and Horgos, as well as some other places in Vojvodina. The
total annual production of vegetables adds up to over 2 million tonnes. Potatoes, along with
peppers and green peas, are the most extensively grown vegetables in Serbia. The
vegetable processing industry in Serbia includes about 25 companies with capacity for
production of frozen, canned and dried vegetables.
•
Major companies are: PIK »Juzni Banat« operates with Agromarket d.o.o. Kragujevac as
a majority shareholder of the company. The core business of the company is in growing
fruit and grapes on an area of 1830 hectares with strong position in export. The "Lucic
Group" includes several companies, "Lucic Prigrevica ad", "Kindja Agrar" from Kikinda,"
Panonka "Sombor and a vegetables trade company "Sunfoods" Lucic Group" is the largest
single producer of vegetables and field crops in Serbia with cold storage capacities of 50
000 tons as well as a processing and packaging facilities. FRUIT LAND-SERBIA is a
group of merged cooperatives own modern cold storage plants for storage of their
products. Mondi Foods is today it is one of the major European processors of red fruit
products. Production capacity is over 6.000 tons of frozen products per year.
•
Frikom is Serbia´s largest producer and distributor of frozen food – mainly ice cream and
frozen fruit and vegetables. The company is owned by Croatian Agrokor Group. The
company had 79 million EUR in revenues in 2009.
•
The joint-stock company food industry A.D. Prehrambena industrija Aleva Novi
Knezevac, a part of the Flory trading group, is a modern food company with over 160
types of various products with a turnover of 20 million EUR (out of which 6 million is from
export).
Wine / grape production
•
Total wine production in Serbia amounts to ~ 170 million litres. Local consumption is
dominated by imported wine (third quarters of wine consumed is imported). The low prices
paid for grapes have resulted in declining production and limited investment in grape
production and processing. The most dominant wines on the local market are from the
Macedonian company Tikves and the Montenegrin company Plantaze.
•
Existing privatized wineries (five very large wineries and ten cellars of medium capacity)
provide most of the country’s current capacity for wine production and grape processing.
•
Wine Zupa is the local market leader with estimated revenues of 56 million in EUR.
•
The company also produces soft beverages and spirits.
•
The company Rubin from Krusevac (owned by the Invej) is the second largest wine
producer with estimated revenues of 33 million EUR.
•
Smaller companies are NAVIP, producing wine, brandy and other alcoholic drinks, as well
as soft drinks and juices and the Vrsacki Vinogradi winery involved in growing of wine
grapes and production of wine from fresh grapes and production of brandies. Several family
wine producers have positioned themselves in the market as high quality wine producers,
especially “Winary Radovanovic” and “Winary Aleksandrovic”.
Beer, mineral water, soft drinks
Beer: Beer production in 2009 reached 143 million litres.
•
Major beer companies are: Apatinska pivara AD is today the biggest brewery in Serbia. Its
popular product is Jelen pivo. CVC Capital Partners is the owner of the company. The
brewery had revenues of 160 million EUR and has invested over 30 million EUR since
privatization. Carlsberg Serbia with Pivara Celarevo is second in the Serbian beer market
with estimated revenues of 90 million EUR. Based on market share, further larger breweries
are Pivara MB (Heineken), Efes Serbia (owner of Pancevo brewery and Zajecar brewery)
and Beogradska Industrija Piva.
Soft Drinks: Sales of soft drinks reached 967 million EUR in 2009.
•
Coca-Cola HBC has been operating in Serbia since 1997 investing more than 150 million
EUR in ten years and is the country's leading soft drinks producer. The revenues from
CCHBC are estimated at 180 million EUR. Arteska International Company serves the
alcoholic and beverages market (market brand: Sinalco). Nectar is a leader in production of
fruit juice drinks and fruit products in Serbia. Company revenues in 2009 were 57 million
EUR. Fruvita is a Serbian company which deals with fruit processing, juice production. It is
the largest growing company in the soft beverages subsector in Serbia with estimated
revenues of 26 million EUR.
Mineral Water
•
Knjaz Miloš AD (65 million EUR turnover in 2009, owned by DFG) and BB Minaqua AD
(19 million EUR turnover in 2009) are the largest mineral water producer in Serbia.
Hot Drinks
•
The largest producers of coffee are Grand Prom (owned by Slovenian Droga Kolinska and
Doncafe (owned by Israeli Strauss Group). Further significant market shares are taken by
the Nestle Group and Kraft Foods.
Confectionary and snacks
•
Confectionary and snacks is a sub-sector with an overall production of 130,000 tons per
year and increasing importance in the food production in Serbia. The sub-sector achieves
annual revenues of over 400 million EUR and an export value of 150 million EUR.
However, the sub-sector is facing severe competition from the region, mostly from Croatia
as well as from Turkey.
•
Major companies are: Swisslion Takovo, a food and beverages producer producing
cocoa cream, fruit juices, baby food, biscuits, waffles and chocolates, as well as alcohol
spirits. Swisslion’s total annual production capacity of confectionery goods amounted to
60,000 tons. Soko Stark is one of the largest confectionary producers in the region. The
company is part of Slovenian Droga Kolinska Group. Bambi Banat is one of the oldest
chocolate and candy producers in Serbia and an integral part of the DFG. The company
has over 66 million EUR revenues. Pionir is a company with 10% Serbian market share
and an estimated 43 million in revenues. Jaffa Crvenka produces the most famous brand,
Jaffa biscuit and the second famous brand Munchmallow. The company registered 24
million EUR in revenues in 2009. Medela is a Serbian biscuits and waffle producer selling
in the national market and exports into the region, EU and overseas. The company had
estimated operating revenues of 23 million EUR in 2009. Marbo product has a broad
product range of snacks from potato chips to nuts. The company is owned by PepsiCo
International. In 2009 the company had 54 million EUR in revenues.
Other food products (niche products)
•
Medicinal and aromatic plants, including wild herbs, forest fruits and wild gourmet
mushrooms achieve a total value of the industry around 150 million EUR, with 50 million
EUR export. Serbia is a net exporter protecting its own market by a 30 % ad valorem import
tariff. There are round 20 organizations in Serbia that bring together over 1,500 collectors,
growers, and/or processors of herbs, mushrooms and forest fruits. Small sized companies
usually do the primary processing, grading, threshing, drying, cutting and packing.
•
There are 20-25 larger processors in Serbia active in final processing. The leading
processors of herbs are Macval (Novi Sad), Melissa (Coka), Fructus (Backa Palanka),
Aleva (Horgos) and Herba (Belgrade).
•
Among processors of mushrooms and forest fruit, the leading companies are Jurofongo
(Kursumlija), Interfood (Cacak), Marni (Krusevac) and Foodland (Belgrade).
•
Organic production is established on 15,000 ha. Key organic products are fresh
raspberries, sour cherries and plums, organic frozen products (strawberries, blackberries,
apples, and vegetables) and other juice concentrates. There are around 77 registered
organic producers. Processing of organic production in Serbia is established in specialized
factories that have relatively small capacities, and in existing fruit processing companies
such as Nectar or Mondi Serbia. Atle is a highly specialized processor and supplier of
frozen raspberries and blackberries from Belgrade with an annual sourcing capacity of over
10,000 tons of soft fruits. The company FOODLAND d.o.o. produces fruit jams, juices, fruit
wines and butter (brand name “Bakina Tajna”). Golden Falcon is a joint venture company
of Trading Organic Agriculture from Amsterdam and its Serbian partner Den Juro. The
factory is the first HACCP operated IQF freezing plant in Serbia. Other companies are
Zdravo Organic d.o.o. and Royal Eco Food.
Packaging, machinery and fertilizers
•
Packaging: With the development of the agro-industry in Serbia, the domestic production of
paper, plastic and tin cans has increased, replacing imported packaging materials. There
are several portals with a quick access to information about the packaging producers in
Serbia, such as www.ambalazaipakovanje.com and www.pakovanje.net. Major companies
are: Tetra Pak Serbia, based in Belgrade with a registered turnover of 141 million EUR in
2009. Umka, a Serbian company which produces cardboard for packaging. The owner is
Kappa Star (also owns Jaffa Crvenka and Avala Ada). Umka had registered operating
revenues of 35 million EUR in 2009. Ava la -Ad a , a company producing transport and
commercial packaging material. The company is owned by Kappa Star Group. Ball
Packaging from Germany, the first foreign industrial company to set up production facilities
“on a green-field site” in Serbia. Ball Packaging manufactures aluminium beverage cans. In
2009, Ball Packaging Europe in Serbia registered 80 million EUR in operating revenues.
The largest producer of glass packaging is the Serbian Glass Factory AD Paracin, owned
by the Serbian state-owned gas distributor Srbijagas.
•
Agricultural machinery and equipment is mostly imported (leading importers:
Agrovojvodina Mehanizacija from Novi Sad, Res Trade, Masferg Agro d.o.o., Almex,
Gamagro, Agropanonka MTZ Finke). The only two remaining Serbian agricultural
machinery producers, IMT from Belgrade and IMR from Rakovica, are working below their
capacities.
2.2
Croatia
2.2.1
Agriculture and Food Industry
The economic importance of agriculture is still relatively high in Croatia, despite a declining
trend in the last few years. The same trend can be observed for the food processing industry.
Both sectors play an important role in the labour market as a significant percentage of the
population of working age earn their income from agriculture and the food industry. Croatia has
an unfavourable structure of agricultural holdings, with a lot of small family farms (the official
average farm size in Croatia is 2.4 ha) and some large agri-businesses. Despite the good
climate conditions for growing many varieties, the country suffers from deficit in the agri-food
sector. Croatia is currently self-sufficient in the production of only few products, but a net
importer of agricultural commodities, also for the food industries. This is because imported
products, on average, are cheaper than domestically produced food. The situation has been
worsened by rising competition from regional and EU players, the latter particularly strong in
exports of cocoa, soybeans, oil crops, breeding cattle, milk, meat, fruit and vegetables to
Croatia.
It is likely that once Croatia enters the EU that some of Croatia's food and beverage markets will
be supplied from other EU countries. Croatia is expected to have difficulties remaining
competitive in agricultural production. Since a major part of Croatia's food processing industry is
based on imported raw materials, it could be expected that some of Croatia's processing
industries will move to the countries of origin of the raw materials.
The food, beverages and tobacco industry comprises over 1,000 companies, employing some
45,000 persons or 18.8% of the total number of employees in manufacturing industry. This
figure has fallen since 2005, although the production of food and beverages is still the leading
industrial segment in the country. The sector has undergone consolidation in recent years as a
result of rising competition, from both within and outside the country.
Nowadays, the main players in the food and beverages sector in Croatia include Agrokor
Group (~ €3.65 bln turnover in 2009; subsidiaries: Pik Vrbovec, Ledo, Jamnica, Zvijezda etc),
Vindija, Podravka, Dukat, Braca Pivac, Gavrilovic, Kraš, Kutjevo as well as Coca Cola
Beverages and Atlantic Group (~ €306 mln turnover in 2009).
Sub-Sectors
Retail
Wine
Confectionary
Meat
Dairy Industry
Mills
Beer
Water
Soft drinks
Hot Drinks
Fish
Konzum (Agrokor)
Mercator (Slovenian)
Metro (German)
Kutjevo
Kras d.d.
PIK Vrbovec d.d. (Agrokor)
Braća Pivac Holding
Belje (Agrokor)
Vrbovec d.d. (Agrokor)
Koka Varazdin Poultry (Vindija)
Gavrilovic doo
Dukat Dairy Industries dd (Lactalis, French)
PIK Vincovci (Agrokor), cereals, sunflower, soybeans
PKK Valpovo, cereals, milling, bakery, meat
Zito d.o.o. (Zito group), cereals, animal feed, meat
Zagrebacka Pivovara (CVC Capital Partners)
Karlovacka Brewery (Heiniken)
Jamnica (Agrokor)
Coca Cola HBC Hrvatska
Franck (coffee, tea)
Adria, Sardina, Cromaris
2.2.2
SWOT Analysis
Croatia’s potential in the food sector lies mainly in increasing productivity and competitiveness
with the help of new technologies, alongside a continuing merger and acquisitions process,
especially amongst the larger companies who have already expanded their network into the
neighbouring countries. These large companies/holdings will try to further grow to strengthen
their position in the market to avoid being taken over by multinationals/EU companies. The
vertically integrated approach (e.g. of Agrokor) of production, processing and retailing could
guarantee the market position. Others like Gavrilovic follow a different integrated approach,
including fast food restaurant into their portfolio. Also companies like Atlantic Group have
strengthened their position by diversification and expansion. A challenge for the processing
companies will be the loss of the CEFTA preferences, especially when it comes to export to
BiH, one of the important export markets of Croatian companies. The Croatian government is
currently trying within the framework of EU negotiations to get a special agreement with the EU
concerning the BiH market.
Strengths, Weaknesses, Opportunities, Threats (SWOT) include the following:
Strengths
•
•
•
Weaknesses
•
•
Food sector is the main sector (20%)
within the Croatian processing industry
Large holdings/companies with
expansion into neighbouring countries
Growth process in the sector responding
to retail development
•
•
•
•
Opportunities
•
•
•
•
Threats
Croatia is supposed to become an EU
member already by 2012/2013, thus
facilitating access to the EU market, and
becoming eligible for EU structural funds
soon
High quality of certain products
Rising foreign investments
Domestic market interesting (local
demand plus increasing tourism)
2.2.3
Relatively weak agricultural production
Still large numbers of smaller processing
companies
Significant modernisation required to
comply with EU standards and productivity
Production costs are relatively high,
resulting in high product prices
Dependence on raw material imports
Low share of EU markets
•
•
•
•
High levels of unemployment (16%)
Price-conscious consumers (purchasing
power higher than in other CEFTA
countries, but still lower than in the EU)
Competition from EU countries
Loss of CEFTA preferences upon entering
the EU
Interesting sub-sectors and larger companies
•
In 2009, the total 54 enterprises in the business of retail had a turnover of ~3.9 billion EUR
billion – by 1.2 per cent smaller than in 2008. In general, decreasing disposable incomes
made consumers re-think their purchasing habits in 2009.
•
Loyalty to well-known, traditional brands are more and more competing with private labels,
although private labels are produced often by the same (brand) producers.
•
The domestic private company Ko n zu m (Ag ro ko r) dominates the retail sector in Croatia.
Konzum holds a 30% share of the total market, up to 40% of the market in the capital
Zagreb.
•
For 2010 it is reported that the market relevance of the retail companies has changed:
Ko n zu m , still the market leader (turnover in 2009 ~ €1.74 bln), is followed by Ka u fla n d
(turnover in 2009 ~ €279 mln), P lo d in e (turnover in 2009 ~ €310 mln), Lid l and Billa
(turnover in 2009 ~ €217 mln). The company SPAR is not anymore among the TOP 10
retailers in Croatia and was replaced by DIONA.
•
The Croatian retail market actually has only one genuine discounter chain – Lid l, and this
chain first appeared as late as 2006. Changes in disposable income attracted more
consumer groups to this discounter resulting in a very strong growth since 2009.
•
In the Cash&Carry segment, German Me tro (turnover in 2009 ~ €325 mln) and Ge tro , now
owned by the Slovenian company Me rc a to r, (turnover in 2009 ~ €238 mln) are the main
players.
•
In the livestock sector, small production units predominate, especially for cattle, pig, sheep,
and goat. Poultry production on the other hand is characterised by large-scale production
units (for poultry meat and eggs). The deficit in external trade with fresh and processed
meat sums up to ~ €124 mln: imports (mainly from EU countries, in particular pork meat and
sausages) amounted to ~ €187 mln, exports (mainly to other Balkan states such as BiH)
amounted to ~ €63 mln in 2009.
•
There are 196 slaughterhouses in Croatia. A number of slaughterhouses are of
international standard and 12 have exporting licenses for the EU and US markets. However,
many municipal slaughterhouses will have to upgrade their standards or be closed, due to
non-compliance with EU regulations. The same applies to smaller meat processing
companies.
•
Although the larger processing companies in Croatia fully meet the EU hygiene standards
and process products of good quality, competition will arise from higher productivity and
lower pricing of EU competitors. Therefore investments in the meat processing sector are
especially anticipated in the field of productivity and expansion/acquisition.
•
Main players in meat processing are
o Ag ro ko r holding with its subsidiaries Be lje (turnover 2009 ~ €180 mln),
P ik Vrb o ve c (turnover 2009 ~ €211 mln), Vu p ik (turnover 2009 ~ €25 mln);
o Vin d ija holding with its subsidiaries Ko ka (turnover 2009 ~ €179 mln) and Vin d o m
(turnover 2009 ~ €21 mln), market leaders in poultry meat processing;
o Family owned holding Ga vrilo vic (turnover 2009 ~ €74 mln)
o Family owned Bra c a P iva c (turnover 2009 ~ €175 mln)
o P o d ra vka with the brands ‘P o d ra vka ’ and ‘Da n ic a ’ (turnover 2009 ~ €60 mln).
•
Milk production reached 814 mln litres in 2009. The percentage of milk production that is
being processed by the dairy industry in Croatia grew from 65% in 2000 to over 80% in
2009.
•
Croatia is still a net importer of milk and dairy products. Total imports in 2007 were 150.000
tons (~ €77 mln), with the highest share of it being cheese, fermented products and milk.
Total exports amounted to 106.000 tons (~ €40 mln). In 2009 milk purchase prices at farm
gate were significantly higher in Croatia than in the EU.
•
The quality of milk is determined according to the regulation on the quality of fresh milk. The
regulation is completely harmonized with the EU regulations.
•
In the Croatian milk industry there are 37 registered dairies, with the largest two (Du ka t a n d
Vin d ija ) processing more than 2/3 of total quantities of processed milk. Du ka t (turnover
2009 ~€ 245 mln) and Vin d ija (turnover 2009 ~ €391 mln) have been continuously
increasing their turnover in the past years, and have become important regional players with
growing export figures and acquisitions in the neighbouring countries
•
The medium segment of the market is far behind the leaders in terms of turnover: the
closest competitor is Meggle (turnover 2009 ~ €40 mln).
Cereals, flour mills, bakeries, edible oil production
•
Cereals dominate crop production in Croatia, accounting for about 65% of total arable land.
Maize (55% of production, 1.4 million tons produced in 2007) and wheat (812,300 tons in
2007) are the most important commodities in this sector. For both maize and wheat the
country is self-sufficient. As Croatia prepares to enter the European Union, Croatian farmers
will need to become more competitive in order to compete with European producers.
Croatian farms tend to be smaller and less technologically advanced than many other EU
countries, which lessens their competitiveness.
•
The majority of the companies in the sub-sectors cereals, milling, oil seed, animal feed and
bakery belong to Agrokor holding or the Osijek based company Zito.
•
Pik Vinkovci, and Belje are large agriculture holdings with own production and processing,
also supplying Argokor’s animal feed processor Agrokor Trgovina. Agrokor’s Zvijedza
(turnover in 2009 ~ € 130 mln) is market leader in margarine and dibble oil.
•
PKK Valpovo, is a large agricultural holding in hand of Zito d.o.o (turnover 2009 ~ €178
mln).
•
In bakery Agrokor is also dominating the production, especially via the bakery Zagrebacke
Pekarne. An important player in bakery is Mlinar (turnover 2009 ~ €37 mln), a subsidiary of
the Skojo Group.
•
•
•
Sugar beet production takes place on around 30,000 ha in Croatia. Local refineries,
including Viro, Slardorana, and Kandit, are working on domestic production and supplying
other markets including Bosnia and Herzegovina, Montenegro, FYR Macedonia, and
Albania and the EU.
Viro Tvornica Secera, the leading company with a turnover of ~ €80 mln in 2009, has
increased its export quota to EU by purchasing Sladorana in 2008 to 120,000 tons annually
(total Croatian export quota 180,000 tons), but still the domestic market accounts for 50% of
the sales.
Kandit was a prominent sugar and candy factory in former Yugoslavia. Today, the Kandit
group comprises IPK Kandit Inc. for the production of candies and chocolates and the
Kandit Premijer Ltd. sugar factory (turnover 2009 ~ € 60 mln), now both in hand of Zito in
cooperation with other investors.
•
•
•
In the fruits and & vegetables sector (including grapes), production is characterised by
small scale farmers producing primarily for self consumption and direct marketing. Grapes
(table and wine grapes) and potatoes are the most important commodities followed by
apples, plums and tomatoes.
Processing companies (beside Podravka) depend also on import of raw material since
the local production does not provide sufficient quantities for processing. The problems
many smaller processors faced in the past was related to utilisation of their capacities due
to insufficient raw material supplies resulting in financial problems not allowing any
modernisation of the facilities. In the last years a number of processors disappeared from
the market or were absorbed by the larger processors.
Most important company in fruit and vegetable processing is Podravka with its brands
Prodravka, Vegeta and the newly purchased brand ‘SMS’. Ledo (turnover in 2009 ~ €162
mln), the Agrokor company specialised on deep frozen products, supplies the
supermarkets with ice cream, ready meals, fish and fruit & vegetables, all deep frozen.
Traditional canning is still done by Eurovoce Zadruga (turnover in 2009 ~ €9 mln), a
cooperative in the north-eastern part of Croatia.
•
Total wine production is estimated at about 100 mln litres. Croatia is a traditional producer
of wine, with around 300 geographically-defined wine-making regions within the country.
Most production already complies with international and EU standards. Most of producers
are located in the county of Split-Dalmatia. Most of vineyards are family farms with an
average vineyard size of less than 1 ha.
•
Domestic wine is expensive in comparison to imports from the EU due to lower productivity.
With increasing competition expected after EU accession a significant drop of prices is
expected. Domestic consumption of wine has been declining in recent years, as younger
consumers increase their preference for cocktail-style drinks. With EU accession it is
expected that the modern wine processors will keep its market share while a number of
smaller producers will face problems with regard to quality and quantities and productivity.
•
The largest wine producer is Ba d e l 1862 (turnover in 2009 ~ €58 mln), producing wine and
spirits. A further large winery is Ku tje vo (turnover in 2009 ~ €47 mln) based in the wine
region of Kutjevo. Ag ro ko r Vin a was founded in late 2009 and envisioned as a regional
leader in the wine industry. Agrokor Vina is responsible for marketing, sales and
development of seven wineries (Croatia: Agrolaguna, Belje Cellars, Ilok Cellars, Mladina,
Istravino, Novigrad Winery; Macedonia: Valandovo Winery). With its partner wineries,
Agrokor Vina holds a 31% market share in the Croatian wine market.
•
The leading private wine makers in Croatia are Vlado Kra u th a ke r from Kutjevo and the
producer Zla ta n Oto k from island of Hvar with significant domestic and exports potential.
•
Beer: In the beer sector, key companies include Za g re b a c ka p ivo va ra (ZAP I): (turnover in
2009 ~ €116 mln, market share 42%), Belgian He in e ke n (owner of Karlovacka Brewery, ~
€92 mln, market share 27%) and Danish Ca rls b e rg : (turnover in 2009 ~ €50 mln, market
share 18%).
•
Soft drinks: Croatia’s bottled water market consumption reached 406.5 mln litres (2007), or
almost 90 litres per person, among the highest in the region. Sparkling water holds a market
share of over 57%, but has been losing markets share to still water in the past few years.
Main brands are J a m n ic a (Ag ro ko r): turnover ~ €143 in 2009 and S tu d e n a (P o d ra vka ).
The soft drink market is dominated by Co c a Co la , turnover ~€136 mln (2009).
•
In hot drinks the Croatian company Fra n c k (turnover in 2009 ~ € 96) is the number one
brand for coffee.
Confectionary, sweets, ice cream
•
Key players in the Croatian confectionery market include primarily local companies, led by
Kra š (which holds with a turnover in 2009 of ~€ 130 mln over one-third of the market) and
IP K Ka n d it (turnover in 2009 ~ € 25 mln).
•
The limitations of the small market are increasingly forcing Kraš and other local players to
look for opportunities abroad and beyond the region.
•
A steady increase in confectionary imports into Croatia is reported. The usual mix of
multinational brands is present in the Croatian market, e.g. Fe rre ro with a turnover of more
than € 69 mln, followed by Ne s tle and Kra fts , both present in various sub-sectors in the
food market.
Fish
•
Croatia’s lengthy Adriatic coastline creates a significant amount of opportunity for the
country to become a leading exporter of fish and seafood, but the fishing industry is beset
by difficulties. The global financial crisis has threatened Croatia’s fishing industry and
hindered Croatian fish and seafood production.
•
In marine aquaculture, Croatia produces vast quantities of a limited number of species.
Ten years ago Croatia began developing tuna farming for export to Japan. Freshwater
aquaculture production in Croatia has been increasing and now totals between 4,000 to
6,000 MT annually. Here, most important farmed species are carp and trout. There are
about 40 companies registered in Croatia for freshwater farming, and many plan to link
freshwater farming with rural tourism.
•
Croatia imports a significant quantity of fish and seafood products. Croatia’s seafood
imports increased to USD102 million in 2009, mostly coming from Spain, Italy, the Falkland
Islands, Norway, and Sweden.
•
Main processing companies are Ad ria in Zadar (turnover in 2009 ~ €22 mln), S a rd in a
(turnover in 2009 ~ €23 mln) and the newly established company Cro m a ris , a merger of
three fish processing companies in Zadar. Cromaris is member of the Ad ris Gro u p .
2.3
2.3.1
The total area of BiH is covered with approximately half forest, and half agricultural land (of
which about half pasture, half arable land). Part of the arable land remains uncultivated
(approximately 44%). On the cultivated land, mostly wheat and maize and other cereals
(together 56%) are harvested, whilst vegetables represent about 13% of harvested area and
potatoes 7%. The production mostly takes place in small-scale farms, with relatively low
productivity.
Agri-food exports amounted to 0.2 billion EUR in 2008, 70% of which was exported to the
Western Balkans. Agricultural imports amount to more than 1.3 billion EUR in 2008, leaving an
extremely negative agri-food net trade balance of more than 1 billion EUR, i.e. BiH is a strong
net-importer of food. Import duties for most of food products are close to zero, and the few
remaining import duties will be further decreased in the scope of the Association and
Stabilisation Agreement and the CEFTA agreement.
Overall, BiH is still at an early stage of approximation with the EU acquis communautaire in the
fields of agriculture and rural development, food safety, veterinary and phytosanitary policy, and
fisheries. The strengthening of state-level capacities in the field of agriculture continues to be
necessary, and preparations to setting up structures to implement IPARD needs to be
intensified.
There is one strong local holding in Bosnia and Herzegovina, the MIMS Gro u p , which is now
one of the largest privately owned companies in BiH, employing over 5000 people. MIMS Group
was founded about 10 years ago as a wholesale company for food products, construction
material and household items. It now has a variety of company members such as Me rku r
(retail), Kla s and S p rin d (mill and bakery), Sarajevo and Tuzla Breweries, and Ve g a fru it.
Further, larger companies from the region are also quite dominant on the market such as
Ag ro ko r (Croatia), Me rc a to r (Slovenia), and Da n u b e Fo o d Gro u p s (DFG).
Sub-Sectors
Retail & Wholesale
Bakeries
Bottled Water, other beverages
Beer
Meat
Edible Oil
Wine
Milk
F&V
Niche products
Konzum (Agrokor, Croatia)
Bingo
Mercator (Slovenia)
Merkur (MIMS Group)
Podravka (distributor, Croatia)
Klas (MIMS Group)
Sprind (MIMS Group)
Sarajevska Kiseljak (Agrokor)
Jamnica (Agrokor)
Vitinka
Coca Cola
Sarajevo Brewery (MIMS Group)
Banja Luka Brewery AD
Tuzla Brewery (MIMS Group)
Lijanovici
Akova Impex Sarajevo
Menprom
BIMAL (Studen and co, Austria)
Hercegovina Vino/Citluk Winery
Podrum Andrija
Meggle Eastern Europe (German)
Mlekara Kozarksa Dubica (DFG)
Sarajevska Milkos Dairy (Teloptic)
Tuzlanska Dairy (Ljubljanska D.)
Vitaminka, Vegafruit (MIMS Group), Marinada (MIMS)
Norfish
2.3.2
SWOT Analysis
Strengths
•
•
•
•
•
Weaknesses
Domestic market / knowledge of local
consumer behaviour
Connection to Bosnian diaspora
Sufficient quality water
(for beverages)
Favourable conditions for fruit and
vegetable,
and
cattle
breeding
production
Larger companies have introduced
quality management systems (HACCP,
ISO)
•
•
•
•
•
BiH is a strong net importer of food
products
Fragmented primary production, quantities
are limited
Small size of processing companies (aside
from some exceptions)
Obstacles to exports (e.g. expensive
laboratory services, administrative
difficulties)
Smaller sized companies have difficulties in
fulfilling growing quality management
requirements
Opportunities
•
•
•
•
Threats
Domestic market (3.8 mln population;
import substitution)
Growing export of berries and other fruits
(export to the region and to the EU)
Duty-free access to the EU market for
most products
CEFTA member
2.3.3
•
•
•
Strong market dominance of foreign brands
/ imported products (since the 1990s)
Low purchasing power of the local
population
Depopulation in rural areas, leading in part
to shortages of labour
Retail and Wholesale
•
The number of supermarkets and hypermarkets in Bosnia has significantly increased over
the last years. Retail chains of foreign ownership (Slovenian, Croatian) are present.
•
Konzum (Agrokor, Croatia) is the leading retailer in BiH (~ €235 mln turnover in 2009) .
•
Bin g o (local company) is the second largest retailer (~ €146 mln turnover in 2009).
•
Other retailers are Me rc a to r a n d Tu s (S lo ve n ia ), In te re x (Fre n c h ), Te m p o a n d Ma xi
s u p e rm a rke ts (De lta M., Serbia),
•
Smaller players are Me rku r (MIMS Group) and Am ko Co m m e rc e .
•
Due to the high share of grasslands in total agricultural land, livestock production is
important for BiH. Halved during the war, livestock have been gradually renewing. The
years 2000-2008 are characterised by constant increases in production of almost all
livestock products (milk production +37%, meat production +16.3%). However, BiH is still a
net importer of meat. BiH has tradition in lamb meat and baby beef production as well as in
processing of meat (in particular dried and smoked meat). There are more than 30 meat
processing companies in BiH, but most are small-scale. The annual capacity of the 11
largest companies is approximately 60,000 MT, but only around 50-55% is utilised.
•
Market leaders are Akova Impex d.o.o., Sarajevo (~ €49 mln turnover, 2009), Lijanovici
d.o.o., Siroki Brijeg, and Menprom, Tuzla. All have HACCP and ISO certification, Ako va
Gro u p also has a Halal certificate and Menprom an ISO 22000-2005 certificate. Other
companies are smaller (e.g. Bra jlo vic , S ta n ic , Bro jle r, La Vita , Bro vis , etc.). Market
leader in egg production is Posavina koka.
•
Production of cows’ milk (whole, fresh): ~750,000 MT (FAOSTAT 2007). About one-third of
the milk is delivered to dairies. Average productivity: 2,559 kg/cow and year
•
There are about 100 dairies in BiH, with a total capacity of ~2 mln litres/day. Only about
one third of that capacity is used. Approximately 45 dairies exceed capacity of 1,000
litres/day and 10 exceed capacity of 100,000 litres/day. The dairies produce mainly highvolume, fast-turnover, low margin products like fluid milk and only a few dairies produce
value-added products like aged cheese. As a result, most value-added milk products are
imported from neighbouring countries or the EU.
•
Market leaders are Kozarska Dubica Dairy (Mlijeko product) (~€31 mln turnover, 2009),
Meggle Eastern Europe GmbH (~€20 mln turnover, 2009), Sarajevo Dairy (Milkos) (~€9
mln turnover, 2009), Banja Luka Dairy and Tuzla Dairy. The companies have HACCP
and ISO, and some also Halal certificates.
•
In 2008, three dairies in Bosnia, the dairy Ba n ja Lu ka , EAS TMILK and Mlije ko p ro d u kt
began operational integration with Im le k g ro u p (DFG, Salford Capital).
Bakeries, flour mills and edible oil production
•
Maize production: ~962,000 tons, wheat production: ~ 255,000 tons (BHAS, 2009).
•
Market leaders (flour mills/bakeries) are Klas (~ €57mln turnover, 2009) and Sprind
(~€57mln turnover, 2009), both belonging to MIMS Group. Further there are a number of
small and medium sized companies.
BIMAL, Brcko, is BiH’s sole edible oil producing company that has crushing, refining and
bottling capacities. (~ €49 mln turnover, 2009)
•
•
From 1996 until recently, sugar beets have no longer been produced. However, it seems
that sugar beet production has been restarted in around Bijeljina.
•
BiH still has some unused customs-free quota for export to EU.
•
Studen in cooperation with Agrana, Austria have built a sugar refinery in Brcko, BIH:
Studen-Agrana Rafinerija Secera, but is only refining sugar based on imported semiprocessed products
•
After 18 years of stand still, the sugar plant of Fabrika secera in Bijeljina started operating
again on November 4, 2010. The plant has a daily processing capacity of 4,000 tons of
sugar beet and production of 500 tons of sugar.
Fruits and Vegetable processing and production
•
Production of vegetables: in total ~490,000 tons on 32-38,000 ha; Potatoes: ~ 414,000
tons
•
Production of fruits: Plums: ~ 156,000 tons, Apples: ~ 71,000 tons, Pears: ~ 25,000 tons.
•
Industrial processing of fruit in BiH involves mainly drying and production of fruit juices (or
concentrates) and jams. However, there are frequent fruit shortages for some fruit
varieties. About one third of fruit juices are imported, as local production cannot meet the
local demand.
•
There are approximately 20 fruit and vegetable processors in BiH,. The two largest
companies, Vitaminka, Banja Luka (~ €14mln turnover, 2009) and Vegafruit (MIMS
Group) (~ €14mln turnover, 2009) export part of their production. Other companies are
small to medium-sized (Mladegs PAK, Vegic commerce, Fruktona, Sava, Berry Dreams,
Bajric Ltd.)
•
Wine production amounts to about 25 mln litres in 2009. BiH is a net importer of wine, with
wine from FYR Macedonia and from Montenegro often being cheaper than the local wine.
•
Wine export mainly through wineries Herzegovina Vino & Citluk Winery (market leader,
400 ha vineyard, winery with 100,000 hl capacity) and Podrum Andrija. Hepok wineries
(different locations) were privatised recently. Other smaller wineries are, for example
Podrum Ostojic, Vukoje, Tvrdos, Stolac Winerey, Doanovici Winery.
•
Beer: Local production covers about 65% of the domestic market. Majority of beer imports
come from Serbia and Croatia. Market leaders are Sarajevo Brewery (~ €39 mln turnover,
2009, owned by MIMS Group), Banja Luka Brewery (~€11 mln turnover, 2009) and Tuzla
Brewery (~ €8 mln turnover, 2009, owned by MIMS Group). Others are the Bihac
Brewery and Grude Brewery. The five local breweries cover estimated 64% of the
domestic market, the rest of beer being imported.
•
Soft drinks: 350 million litres sales of soft drinks / year, of which about half bottled water.
Still and functional bottled water are fast growing categories. Sales of bottled water
outperformed those of soft drinks overall within Bosnia-Herzegovina during 2009 in both
value and volume terms. Market leader for soft drinks is Coca Cola HBC B-H (market
leader soft drinks, ~€ 61 mln turnover, 2009)
•
Bottled water: Sarajevski Kiseljak (Agrokor) is market leader for bottled water (~ €35 mln
turnover, 2009) followed by Vitinka (~€11 mln turnover, 2009). Other companies producing
bottled water are Sarajevo Brewery, Ilidzanski Dijamant, Oase, Planinski Biser and Leda.
Despite having good resources of water, BiH is still a net importer, with imports mainly
coming from Croatia (e.g. Jamnica) and from Slovenia.
Confectionary / snacks / pastry etc.
•
Until 2008 strong growth in sales of confectionary and snacks. Since the global financial
crisis, consumers look again more for basic food stuff and products at discount prices.
Sales of confectioneries amounted to 15,500 tons (2009).
•
Companies from the region (in particular from Slovenia, Croatia, and Serbia) are dominant
in the market.
•
VISPAK, Visoko is a local company producing coffee, chocolate, snacks etc. The turnover
was €10 million in 2008. Furthermore, Vitaminka a.d., Banja Luka also produces
confectionary and snacks (in addition to processing fruits and vegetables). Other
companies producing chocolates, ice cream and/or snacks are, for example Lasta,
Barpeh, Emmesse, and Eurovip.
Fish:
•
Larger companies are Norfish Blagaj (a Bosnian-Norwegian company near Mostar with
processing facilities), Tropic, Banja Luka, and Riz Krajina. Quota for customs free export
to EU (2010): 60 tons processed fish.
Others
•
Other productions are honey, aromatic and medicinal plants, herbs, and mushrooms, but
mostly at small scale.
•
Companies producing essential oils and herbs are, for example Roing, Ljubuski, and
Andjelvic, Trebinje. The company Pharmamed produces medicinal herbs and teas.
2.4
Moldova
2.4.1
In the Republic of Moldova, agriculture has traditionally been regarded as the cornerstone of the
national economy: agricultural output accounts for 15% of GDP and together with the
processing industry represents over 30% of GDP and approximately 60% of total exports. At the
same time, agriculture constitutes the most important sector of the national economy, using over
35% of the country’s labour force. Although a free trade agreement has been negotiated with
the EU, the country’s main trading partners remain Ukraine, Russia and Romania.
Although the climate is relatively favourable to agriculture, the country is experiencing
increasingly harsh agricultural seasons and drought periods (the last occurred in 2007),
resulting in severe losses of crops. Privatisation has created a dual structure of farms with about
half of the private land in hand of 300,000 smaller, individual farms averaging 1.9 hectares.
Most of these small farmers do not have the resources to purchase improved
inputs/technologies and therefore add value to their production; however, some farmers have
increased their farm size by forming associations or by leasing or buying land. The other half of
the privately owned land is managed by about 1,500 large-scale corporate farms that average
around 650 hectares, cultivating extensive crops like sugar beets, wheat, and sunflowers that
require less labour, but more land and machinery.
The food industry accounts for 60% of the total exports of Moldova through three major sectors:
(i) a strong wine industry; (ii) a stable and promising horticultural production and processing
industry and (iii) a less important dairy and meat industry.
Sub-Sectors
Retail & Wholesale
Wine
Sugar industry
Beer, Soft Drinks, Water
Meat
Milk
Vegetable oil; nuts oil
Cereals / Mill
Sweets / Pastry
Nr. 1 (Moldovan)
Greenhills Nisku (Ukrainian)
Fourchette (Ukrainian)
Metro Cash&Carry (German)
Fidesco (British)
Grikova (state)
Milesti Micic (state)
Acorex Wine Holding (Russian)
DK Intertrade (Dionys)
Chateau Varteley
Others (Bostovan, Hincesti, Pucari, etc.)
JSC Südzucker Moldova (German)
MARR Sugar Moldova (Russ.-Mold.)
Natura Bravo (Russian)
Orhei-Vit
Alfa Nistru
Tymark (Polish)
Efes Breweries International
Coca Cola
Risan (Russian, German, Mold.)
Bacarabia Nord
Carmez International (Belgian-Mold.)
Incomla
Florea Soareluj
Violika (oil from nuts)
JCC Seminte Nord
Kelly Grains
Bucuria
Franzelura
Neffis
2.4.2
SWOT Analysis
Strengths
•
•
•
•
Weaknesses
Food sector is main sector (43%)
within the Moldova processing industry
A number of large holdings/companies
with FDI
Good climate for agriculture
Low labour costs
•
•
•
•
•
Fragmented agriculture production
Still large number of smaller companies
Significant modernisation required to comply
with EU standards/productivity
Lack of labour force
Not yet in compliance with EU Food safety
standards
Opportunities
•
•
•
•
Threats
Opportunities to diversify export
destinations, e.g. for wine
Opportunities for fruit and vegetables
Investment opportunities in primary
production incl. organic farming, food
processing, input supply, and
agricultural finances
Opportunities in equipment for
irrigation, packaging and processing
•
•
•
•
•
•
•
•
2.4.3
Political stability (or political influence on
trade) with regard to parliamentary elections
in 11/2010,
Instability of government policies or political
influence on trade, political problems with
Russia affecting Russia as important export
market, or with Romania as export market
Separatist regime in Moldova's Transnistria
region.
Scepticism of foreign investors
Low efficiency of government due to
bureaucracy and government instability,
corruption
Local currency less devaluated than
currencies of competing countries
Local infrastructure incl. roads, electricity, gas
and water supplies
Agricultural weather, e.g. droughts
•
There are over 100 supermarkets (>2,500 square meters of commercial area) in Moldova,
the majority are concentrated at larger places. The majority of supermarkets buy their fresh
products locally as well as from imports. Local producers often do not meet the supply
schedules, packaging standards required by the supermarkets.
•
According to some distributors’ calculations, about 10-20% of the Moldovan population
buys their groceries in supermarkets, depending on the size of the towns and the presence
of supermarkets.
•
Major supermarket chains in Moldova are Furchet, Green Hills, N1, Fidesco, Metro Cash
& Carry, Cvin, Linella, and Everest.
•
The meat processing sub-sector in Moldova is represented by 17 large enterprises with a
total value of sales in 2008 of €63 mln. This comprises about 67% of sales of the entire
sector. The value of the total processing and preserving of meat and meat products in 2008
was estimated at €94 mln, or 5.1% of the total industry of the country.
•
The meat processing sub-sector in Moldova is represented by 17 enterprises with a total
value of sales in 2010 of USD 82.8 mln. Two meat processing companies control 80% of
the local meat market. Carmez is the largest meat processing company in Moldova with
around 1,000 employees and a broad product range. The main markets are Moldova and
CIS countries. Basarabia Nord JSC is one of the most important salami and sausage
producers in Moldova. The company has more than 500 employees and a wide range of
products, e.g. more 150 types of salami.
•
The dairy products industry accounts for 5 % of the entire food processing industry and
12% of the food product and beverage industry. The milk production in Moldova derives
mainly from small farms and households. Milk productivity varies by regions but ranges
between 4,252 and 1,260 litters per cow. The annual production of milk in 2009 was
543,000 tons. Some of the milk producers formed milk collecting cooperatives. One of the
biggest ones is located in the Rezina region and involves 410 members.
•
With regards to the production data in the dairy sector available milk is sufficient for the
domestic demand, although processed products are still imported. Imports of milk and dairy
(mainly cheese and curd) products are mainly coming from Russia and Ukraine. Moldova is
a net exporter of powdered milk, with exports directed towards Russia.
Milk processing is done by 12 companies processing about 25% of the total milk
production. The rest of the milk is locally consumed by households (as fresh or homemade
cottage cheese) or sold in local farmers markets.
In the milk sector, four milk processing plants (JLC JSC, Lactalis, Incomplac and
LapMol) control 80% of the internal dairy market whereas Incomplac controls 45% of the
internal market and produces 50% of the total powder milk in the country.
•
•
•
Cereal production has a vital importance to the country. The main crops cultivated in
Moldova include wheat, barley, corn etc. The land area under cultivation with cereals was
~1 mln ha in 2008. Moldova's wheat harvest totalled some 772,000 tons in 2010.
•
Flour mills are in private ownership: out of 150 mills there are only 3 with state
participation. The total production capacity of the flour-milling industry is circa 40-43,000
tons per month. The value of the flour milling industry including starch production was
estimated at €14 mln in 2008 (0.8% for the total industry).
•
Oilseed production and processing: The main oleaginous plants in Moldova are sunflower, soy and rape. The overall volume of these plants in 2008 totalled 430,000 tons.
Important companies are Trans Oil Group, WJ Moldova Group, JSC Seminte Nord,
KELLEY GRAINS IMPEX LLC, FLOAREA SOARELUI JSC
•
Bakeries: Bread is mainly produced by the private sector and rural households. There are
232 bakeries registered in the country processing 500-520 tons of flour daily. 48
enterprises are manufacturing bread and pastry products in 2008 to a value of €40 mln.
Important companies are FRANZELUTA JSC, NEFIS LLC, UPTORUL FERMECAT LLC.
•
Sugar has a strategic importance in the national economy in Moldova. In 2008, the area
planted with sugar beet was 24,700 ha in size, producing 960,000 tonnes of sugar beet.
•
Currently, sugar beet in Moldova is processed by two companies: JSC “Südzucker
Moldova” (incorporating the sugar factories from Drochia, Făleşti, Alexăndreni and
Donduşeni) and “Marr Sugar Moldova” LTD (incorporating the sugar factories from
Cupcini, Glodeni and Ghindeşti).
•
•
Fruit production has varied from approximately 200,000 tons to 400,000 tons on an
annual basis. According to private sources (fruit traders, exporters) Moldovan production of
fruit increased to approximately 1 mln tons p.a.; a result of new technology, farm
management and irrigation schemes. Apples are the largest fruit crop in Moldova (60% of
fruit production).
Vegetable production consists mainly of open-field vegetables with a production area of
45,000 ha with total production of ~ 393,000 tons. About 7,270 tons of vegetables were
produced in greenhouses in 2009.
•
Fruit and Vegetable processing: There are some 50 horticultural processing plants
(including dried fruits and herbs and excluding wineries) most of which work below the
installed capacity (15-25%). Most of the larger processing companies are equipped with
modern equipment imported from the EU. The value of the processing industry in 2008 was
€74 mln and accounts for almost ten percent of the total value of the food industry (€755
mln).
•
Six companies (Orhei-Vit, Alfa-Nistru, Natur-Vit, Natur Bravo, Rozmiar, Cosnita,
Floresti) export the bulk of apple juice, preserved cucumber, canned peas and juice/whole
tomatoes. The product range is diverse: natural juices (clarified and with pulp), nectars,
fruit. More than 90% of production is destined for export. CIS remains the biggest market
for exported fruit and vegetable products, accounting for 70% in total including Russia
(38%) and Ukraine (9%). EU-27 and other European countries account for the other 30%
of exports, mostly in the form of semi-finished products.
•
A very promising agribusiness sector in Moldova is wine production and processing. 96.5%
of Moldova’s vineyards are privately owned. The current annual volume is around 400,000
tons. In 2008, there are 158,000 ha of vineyards in Moldova: 86% are cultivated with
technical varieties and 14 % with table grapes. Annually, Moldova produces about 200-300
million bottles of wine, 20 million bottles of sparkling wines, and has a production potential
of up to 1.0 bln of bottles per year. The majority of the wine is exported to Russia and other
Eastern countries.
•
In 2008, 112 larger wineries were licensed. Furthermore, there are 75 wine bottling lines at
63 enterprises. 24% of the wine companies own their own plantations. It is estimated that
Moldovan wineries produce about 140-160 mln litres (2008) of still wine a year, and about
7.27 million litres of sparkling wines (plus production of brandy).
•
Larger wineries are Acorex (leader in premium wines as well as quality commercial wines),
Chateau Vartely (medium-sized winery specialises in premium wines), Cricova Winery
(famous for its unique underground labyrinths and excellent wines, being one of only three
underground wine cellars in the world that are protected by UNESCO), 'DK-Intertrade'
(part of the Alcoholic Holding Company 'Dionis Club', a leading producer and exporter of
the Moldavian wines), Dionysos-Mereni (first winery in Moldova to receive ISO 9001:2000
certification), LionGri (with about 1000 hectares of top vineyard in the best grape growing
regions), and Milestii Mici (established in 1969 as a facility for storage and maturing of
high quality wines, with wine cellars, created in the galleries of a disused limestone quarry
40-85 metres deep rate as the largest in the world), Vinaria BostaVan and Purcari
Winery.
•
The value of the production of mineral water and freshener beverages was €21 mln in
2008.
•
Moldova is a net exporter of beer and soft drinks.
•
There are 11 large and medium scale enterprises in Moldova that are producing mineral
water and freshener beverages, for example: EFES VITANTA MOLDOVA BREWERY JSC
(beer and soft drinks), BeerMaster JSC , RESAN LLC, a Moldovan-German company
producing soft drinks and mineral water and RUSNAC-MOLDAQUA LLC.
•
Walnut production and processing: According to the International Trade Centre in
Geneva, Moldova is one of the largest European exporters of walnuts, after USA, Mexico
and China. The walnut growing area includes 6,000 ha and is constantly expanding. The
production of walnut sums up to 15-18,000 tons annually. Most of the below-mentioned
companies are exporters and processors of products destined for the EU markets:
Reforma Natural Fruit and Nuts, a German investment operating in Moldova in walnut
export; Monicol, processor and exporter of dried fruit and walnut kernel; VM Plumcom
processor and exporter of dried fruits; Prometeu-T, major processor and exporter of walnut
kernels in Moldova.
•
Dried fruits production: The Moldovan dried fruit sector consists of a few large and
medium companies and a large number of small enterprises. Over the past three years
Moldova produced 2,000-3,500 tons of dried fruit per year, depending on the growing
conditions for raw material. Export levels are usually about 70% of production, the EU
absorbing about 80% of the exports; CIS countries, primarily Russia, Belarus and Ukraine,
accounting for the other 20%.
Packaging, logistics, machinery and equipment
•
Packaging is available in Moldova based on own production and on imports. Various
companies deal with different packaging material. Larger companies are Horn and the
Glass Container Company which has been supported by EBRD in the past.
•
Agricultural Machinery & equipment: Currently, there is only one tractor manufacturing
enterprise: Tracom JSC, but it is not operational. In 2009, Moldova imported 2233 tractors,
mostly from China, Belarus and Germany. Harvesters (combines) are not manufactured in
Moldova, agricultural enterprises usually import from Germany or Russia. There are
several companies in Moldova that are manufacturing other agricultural machineries. The
largest ones are Moldagrotehnica JS and Agromasina JSC.
2.5
Albania
2.5.1
Albania has been one of the fastest-growing economies in Europe with a steady economic
growth of 6% during the recent years, though the economic crisis has affected the country in
2009 and 2010. Still, IMF foresees a positive 2.6% economic growth for 2010 in Albania.
Inflation has been in the range of 2 - 4%. Economic development was accompanied by rapid
reductions in poverty. Poverty fell by half (to about 12.4 percent) between 2002 and 2008, while
extreme poverty now affects under 2 percent of the population.
Currently Albania imports € 434 mln worth of food and agriculture goods, representing 18% of
total Albanian imports. Consumption is increasing due to increased incomes and economic
growth. A significant part of imports is destined for industrial/processing purposes and has
stirred up new profitable activities both in the agriculture and agro-processing sectors. The main
product categories imported in Albania are wheat and rye, fruits, vegetable oil, followed by fresh
and dried vegetables, potatoes, rice, livestock/meat and all kinds of processed food as well as
agriculture machineries. Imports are mostly coming from Italy and Greece (29%) followed by
Brazil (meat), Germany, Russia, Turkey and other countries.
The agriculture and food processing sector has been one of the growth drivers in the economy.
Production value of this sector was 35% higher in 2008 than in 2000. About 2,120 enterprises
are currently operating in the agro-processing sector. While they are operating in a variety of
sub-sectors, larger enterprises are found in the flour production, milk processing industry, meat
processing industry, refined oils, wine and other beverages. However, the competitiveness of
the food industry is limited. Besides retail and wholesale, meat and beverage sub-sectors, most
of the food industry companies in Albania are of relatively small size.
Sub-Sectors
Retail & Wholesale
Meat
Dairy
Beer
Mineral Water/
Soft drinks
Milling
Oilseed
F&V
Wine
Herbs
Fish
Euromax ,
Mercator (Slovenian)
Conad
Frigo Food (poultry)
EHW GmbH
KMY
Floryhen (poultry)
Mireli
Ferlat (Meggle)
Stefani & Co
Birra Tirana
Birra Korca
Alfa Glina
Tepelene
Uji Qafshtama
Coca Cola
Bloja, Mielli, Atlas
Erbiron, Olim
Sejega
Kantina Gjergi Kastriot Skenderbeu
Albducros
Euro Fish, Poseidon
2.5.2
SWOT Analysis
Strengths
•
•
•
•
Weaknesses
Suitable climate especially for F&V products
Low labour costs
Business orientation and entrepreneurship
Food Safety Agency has recently been
established
•
•
•
•
•
•
•
Fragmented primary production
Low supply of raw material to processing
industry due to VAT exemption of
farmers
Processing industry mostly small scale
Albania is a net importer of food.
Low purchasing power
Low law enforcement in food safety
Certification bodies for quality
management (HACCP) not accredited,
leading to higher certification costs when
exporting
Opportunities
•
•
•
Threats
Low labour costs
Import substitution for a variety of products
(in areas, where price competitiveness is
possible)
Development of retail sector
•
•
•
•
•
2.5.3
Competition from imports
Corruption
Countability of political parties
Infrastructure (power cuts, road network,
waste/waste water management etc)
Image of Albania (more ‘poor’, ‘chaotic’)
despite enormous changes in the country
•
Food retail chains are a brand new sales practice in Albania in the last three years. The
retail sector has been one of the most dynamic sectors in Albania. Shopping centre
development has been a key contributor to retail growth over the past few years. Due to
the economic crisis, the index of retail sales notes a decrease during 2009. However this
has not impeded investment plans in the retail sector. In the medium term (2-5 years), it is
foreseen that the retail market in Albania will continue a positive high growth with over
100,000 m2 of retail development.
•
These developments open good perspectives for more food varieties, canned foods, etc
where Albanian production is still very much lagging behind.
•
Larger supermarket chains operating in Albania are Euromax, Mercator (first market
opened in December 2009 in Tirana), Alfa-Beta Vassilopoulos, Conad.
•
The Kosovo based chain ETC expressed also interest to expand to Albania.
•
Slaughterhouses: In Albania many slaughterhouses are not in operation and the active 20
slaughterhouses only slaughter few cattle or pigs or small ruminants daily. All
slaughterhouses are operating far below their capacities due to low supplies. Usually the
facilities are outdated and in most cases they do not even comply with the Albanian law.
EU standards on hygiene, public authority, traceability and HACCP are not fulfilled.
•
There are three major slaughterhouses for poultry in rather good condition: Chicken Farm
in Kavaja belonging to Frigofood company), AGRIZOO in Lushnja region, DRIZA in Fier
region.
•
The situation in the chicken sub-sector looks much better as here are several investors
active also in other agribusinesses, e.g. feed production companies or slaughterhouses.
There is a trend to establish a complete integrated chain of operations, from chicken farms
to feed mill and retail outlets. Aiba Company shpk (www.aiba.al) and Floryhen shpk
(www.floryhen.com) dominate the chicken and egg production in Albania and belong to the
three big fodder producers together with AGROTEK ALB shpk, control 70 – 80 % of the
market in Albania. Wheat and barley for animal feed is purchased mainly locally, but other
inputs are imported from Greece, Italy and Serbia.
•
Meat Processing: There are currently 14 consolidated meat processing enterprises that
operate throughout Albania. The current market size is €55 million, processing 21,500
metric tons of meat per annum, 85% of which serves the domestic market.
•
95% of the meat processed in Albania is imported, primarily from South America. Local
meat is too expensive and of limited availability. The processed meat is mainly pork, but
also poultry and beef. Meat processing companies use modern technology in processing
frozen meat but face limited know how in processing fresh meat since most processing
companies import meat for processing.
•
The leading companies have a sound documentation of their production including
traceability and applied HACCP. Albanian standards according to Food Law and orders of
MAFCP are often applied; even EU standards on hygiene, public authority, traceability and
HACCP are in place at big companies which are almost ready for EU export licences.
•
The premises of the top meat processing companies like EHW, KMY, TONA are very
modern and fulfil already EU standards. Therefore, best opportunities are among this
relatively small, but dynamic group of companies that aim to produce for export markets.
These companies often import their raw materials from the world market and export to
adjacent markets like Kosovo, Macedonia, Yugoslavia.
•
The total national milk production of Albania was ~ 1 mln tons in 2008, out of which
860,000 tons are cows’ milk. The commercial market consists of informal (direct selling
from farmers) and formal market channels (collection & distribution by dairies).More than
half of the milk produced in Albania is used for self consumption, sold directly in the
informal markets or used for feeding of animals and less than 50 per cent reaches the
processing industry.
•
The dairy processing industry is still on the way of modernizing structures and
technologies. The system of value added tax (VAT) is a major obstacle for the processing
industry. A 20 % VAT is charged on all products. Since farmers are excluded from VAT
payments, the tax is levied on processed products only. This increases the retail price and
aggravates competition of processed products compared to the informal market.
•
There are about 27 modern dairy processing plants in Albania operating with a capacity of
10-40 tons per day but struggling with competition from the informal market. None of them
can utilize its capacity. The dairy plants with complete milk processing lines are producing
pasteurized milk, yogurt, UHT milk, butter, butter milk, curd, cheese and fruit yogurt.
•
Meggle is now the first foreign milk processing company active in the milk processing
business in Albania. MEGGLE Eastern Europe Ltd. officially became in August 2010 a
100% owner of the Albanian dairy Ferlat sh.p.k. with a headquarter situated in Rhogozine.
The Dairy Ferlat sh.p.k. is one of the largest dairies in Albania, located in Tirana province.
According to Meggle, with more than 10 tons purchased raw milk per day Ferlat has growth
and capacity enlargement potential, especially with regard to its 57% market share in
consumer milk. Other larger dairies in Albania are Greal in Korca, Mireli in Kavaja,
Deltadoni in Lushnja, and Gjirofarma in Gjirokastra.
•
Cereal production and flour mills: Wheat production in Albania reaches 300,000 tons in
2009; not showing much increase in the last decade. Albania's milling industry uses mostly
imported grain. The five important milling plants (Sh. A. Mielli, Prima- Bloja SH.A,. Atlas
SH.A., Mulliri i Arte and Prima) in the country cover about 50% of market needs
according to data from the factories and the Ministry of Food & Agriculture.
•
Edible Oil: Larger companies dominate the domestic markets. One is the prominent
company of OLIM processing a variety of seeds with sunflower the most important. Other
larger companies are Vajra Bimore Fiol and Erbiron.
The olive oil sector provides potential for SMEs, in particular in the field of organic olive
oil. At the same time there are hurdles to be overcome: product quality should be
improved, the value chain is rather inefficient, and international trade is not yet mature. In
view of the growing market for organic olive oils in Western Europe, the production
conditions in Albania can offer an attractive sourcing option. Agrotal 1 SHA is one of the
few Albanian companies with EBRD as shareholder (30%).
•
•
The main vegetables produced in Albania are cucumber and tomato. Winter season
vegetables cultivated include lettuce, spinach, carrot and cauliflower. The absence of profit
tax on farmers on the one hand, and of protective measures for home production on the
other, have had a considerable influence on agriculture production, especially in
greenhouses, reducing imports and beginning to export modest quantities of vegetables.
•
The vegetable and fruit processing industry fulfils only 30% of the needs of the domestic
market. The processing industry is dominated by micro and small enterprises. There are
only two companies, with more than 100 employees using both local and imported raw
material. One of these companies, Sejega, is located in Tirana, and the other, Sidnej, in
Berat. These are the only companies producing both for the domestic market and for
export. In addition, there are several medium sized companies: In this group are Shpiragu
(in Berat) and Kampion (in Shkoder).
•
Albanian grape production is primarily dominated by small, independent vineyards. Quality
standards of the grapes are generally low due to heterogeneity of cultivars and inefficient
agronomic production practices. Some quality improvement trends have been recorded
recently, but the quality achieved still falls short of the standards of many wineries in EU.
70%-75% of wine consumed in Albania is produced by farmers and/or small wineries which
are not licensed. Important spirit producers and wineries are Aquila Liquori,and Kantina
Gjergj Kastriot Skenderbeg.
•
More than 80% of total Albanian wine imports come from the EU countries, with Italy as the
main supplier (82% of EU imports).
•
In the past few years local beer producers have made investments totalling up to € 30-40
mln with production capacity providing for more than 120% of national beer consumption.
The beer industry has used its influence within the state administration in terms of
protectionism and negotiations on free trade agreements with other Balkan countries and
the European Union. The competition for the industry comes mostly from Greece and
Serbia.
•
Birra Malto is the largest brewery in Albania. The company sells a pilsner beer under the
Birra Tirana brand, named after the capital, Tirana, where the beers are brewed. Further
important beer brewers are Birra Korca and Stefani & Co.
•
Soft drink market is dominated by Coca Cola; important mineral water producers are from
Alfa Glina, Tepelena, Dilo shpk Uji Qafshtama produced by EHW Group.
Niche products (Fish)
•
In the fish sector, investment opportunities are related to bad conditions of the fleet, and
investments are needed in almost every part of the supply chain including harbour facilities,
fleet renovation and maintenance facilities, fish collecting/warehousing and fish processing.
Aquaculture becomes more and more important in Albania as well.
•
Opportunities for outsourcing production in the fish processing are already a successful
experience since many years in Albania for many Italian companies. In fish processing
there are some 27 companies in the field, all of which need modernisation. Important
processing companies are Italian companies Euro Fish and Poseidon. Konservimi
Adriatik and Rozafa, Albanian company is well known for fresh and processed fish.
Niche Products (Herbs and Spices)
•
Most exported products from Albania in the agro-business sector have been medicinal
plants noting a 16% growth from 2007 to 2008. The International Trade Centre ranks
Albania as a champion country and having a very high comparative advantage for these
products in the world market.
•
Albania produces over 60 varieties of herbs and spices, including cooking spices, medicinal
herbs, and essential oils. This is an innovative and growing industry that has become a
major supplier to global food companies, as such Albanian herbs are renowned the world
over.
•
There are about 10 export companies, exporting their products mainly to the US, the EU
and Turkey. Spices and herbs normally have the same trade structure and distribution
channels and very few traders deal exclusively in herbs. Leading companies in Albania in
the herbs sector are: Albducros, Filipi (exporting sage to the US), Xherdo (producing
essential oils)
Packaging, logistics, machinery and equipment
•
Packaging comes mostly from imports. Albanian imports in paper and packaging product
reaches up to 20% of the total sales of the food processing industry. Currently most of
packaging is imported (metallic packaging is all imported), while paper/cartoon packages is
offered also by several domestic producers.
•
MORPACK ALBANIA SH.A: Morpack produces irrigation pipes and plastic packaging
materials and belongs to Elbisco Holdings S.A.. Other companies in this field are Edipack
and Alb Paper.
2.6
Kosovo UN Res. 1244
2.6.1
On 17 February 2008 the Kosovo Assembly adopted a resolution declaring Kosovo
independent. It is now named Kosovo under UNSCR 1244/99. Over the past few years
Kosovo’s economy developed further and made progress to a more market-based economy.
However, remittances from abroad are still very important (~14% of the GDP) and
unemployment (over 40%) is a significant problem.
Kosovo has one of the most open economies in the region, with low customs rate on imports
(1% for products from CEFTA countries, 10% for goods from EU, 0% for agricultural inputs and
capital goods), and customs-free access to the EU and the US market.
Kosovo is a relatively small country with an area of about 1.1 million ha, of which around 53% is
considered to be agricultural land. Approximately 87% of the agricultural land was in private
hands, the remainder is administered by the Kosovo Privatisation Agency (KPA). Irrigation
systems are a constraint to agricultural production, and Kosovo has limited water resources.
Cereal and fodder crops account for the largest share of arable land in Kosovo, followed by
vegetables. Overall production levels are very low and cannot satisfy domestic demands (e.g.
self-sufficiency for vegetables: 13% and for fruits only 6%). Cattle production including milk
production is mostly taking place on very small-scale farms. Farms are usually small (3.2 ha in
average) and mostly semi-subsistence production, with a very significant share of on-farm
consumption and informal trade. Market integration is low. Agro-processing firms used to be
part of Agro-Kombinats, which were mostly privatised. Kosovo has a tradition in wine
production, but most of the plantations are relatively old now.
Kosovo is a strong net-importer of agri-food products. Overall export level is insignificant, and
agri-food imports are amounting to more than 400 million EUR (2008). Most of the agri-food
trade is with the neighbouring countries Serbia, Macedonia and Albania. The main agri-food
import products are: Tobacco, Beverages, Meat, Cereals, Dairy produce, eggs, honey. Most of
the companies in the food sector in Kosovo are still relatively small, with the exception of a
larger retail & wholesale company Elkos Group, ETC, the company Abi, and the brewery Peja.
Sub-Sectors
Retail & Wholesale
Elkos Group (ETC, private)
Interex
Albi Shopping
Benaf
Beer
Peja Beer (beer, soft drinks)
Wine
Stone Castle
Haxhijaha
F&V (incl. potatoes)
Pestova Company (proc. potatoes)
ABI & Elfi (part of ABI)
Milk
Devolli Company
Abi Dairy
Meat
Koral – Prishtine
Alaska (meat importer)
Flour mill
M&Sillosi
Others
APS – Medical & Aromatic Plants
2.6.2
SWOT Analysis
Strengths
•
•
•
•
•
•
Weaknesses
Long tradition in agriculture, Suitable
climate for a variety of products
Low labour costs
Young population
Links to diaspora
One of the main suppliers of potatoes
in the region
Well developed retail sector
•
•
•
Opportunities
•
•
•
•
Opportunities on the domestic market
(Import substitution)
Opportunities for export for specific
products (e.g. potatoes, products for
the diaspora)
CEFTA member (access to markets
in the region), Custom free access to
EU market (EU Western Balkan
Pact), Bi-lateral free-trade agreement
with the US and other countries
Privatisation opportunities
2.6.3
Fragmented primary production, limited
storage and post harvest capacities
Fragmented processing (mostly small family
businesses)
Frequent power cuts and general weak
infrastructure (roads, irrigation)
Threats
•
•
•
•
Relatively small domestic market
(~ 2 million inhabitants) with low purchasing
power of the population (very high
unemployment)
Dominance of foreign products and brands
Underdeveloped quality control mechanisms
Limited price competitiveness
Retail and wholesale (food products)
•
Kosovo’s retail market traditionally is fragmented, with competition mainly among small
family shops. In recent years, supermarkets are increasingly dominating (with areas of
around 3,000 m², with foods and drinks taking up 25-30% of the total trade area. The new
trade centres are being built mainly on the outskirts of big cities.
•
The rise in number of foreign-owned stores is expected to boost the import of goods
offered under the chains’ own brand. Many products are imported from Serbia, some
experts estimate that nearly 70% of consumer goods in Kosovo come from Serbia.
•
Elkos Group (ETC markets) is the main distribution company in Kosovo. ELKOS was
founded in 1990 as a retail store, and then moved into wholesale, and steadily grew further
until 1998/1999. From 2000-2005, growth rates were again extraordinary high, as ELKOS
established itself as a distributor for European producers and opened around 14
supermarkets in all major cities. Other supermarket chains are Interex (France), Albi
Commerce, and Benaf.
•
Meat consumption: ~102,000 tons (2007). Raw material and final products are to a large
extent imported.
•
Livestock: Local production is mainly on a very small-scale. There is a considerable
amount of on-farm consumption and informal trade. Local farms supply between 15-20 %
of Kosovo’s formal meat market, with a remaining balance of some 80-85% being imported
(2007). Traditionally Kosovo was an important exporter of lamb meat.
•
Kosovo has ~12 meat processing companies that together process approximately 3,000
tons of locally produced meat annually (2007). There are about 6 relatively large meat
processors supplying around 15-20% of Kosovo’s domestic market. Almost 100% of the
packaging material needs are imported. The Government is elaborating a strategy how to
improve the food safety standard in dairy and meat processing plants. One can expect that
some establishments will be closed, and others need to invest to meet the required
standards.
A major meat processor is Koral, Prishtina. A chicken meat and egg producer is KonSoni,
Gjilan. Alaska and Valvis, Prishtina and Prizren have the biggest slaughtering facility in
Kosovo, using mostly imported livestock.
•
•
Demand for milk is estimated at ~320-340,000 tons. Local milk production is estimated at
~ 240-260,000 tons (number of milk cows estimated at ~140,000). Milk is mostly consumed
directly on the farm or sold as raw milk or sour cream, white cheese on local markets.. Only
about 10-15% of the milk is supplied to dairies (estimate about 34,000 tons). Imports
amount to ~82,000 tons per year (milk products in milk equivalent litres), amounting to 2530 million EUR annually. Import products are mainly UHT milk, yogurt, butter, white cheese
and yellow cheese. About 80% of its imports come from the EU, mainly from Hungary,
Slovenia and Germany.
•
Kosovo has ~26 processing units, of which only 18 are licensed. Of those, about 5-6
diaries may be called ‘commercial’ (with 5,000-40,000 litres intake per day). The dairies
mainly produce liquid milk, yogurt, white cheese. The dairy processing industry in Kosovo is
currently in the process of implementing and integrating quality management systems.
•
Devolli Company, Peja, began in 2003 with the production of Vita UHT milk. Vita milk is a
cooperation between Devolli and Tetra Pak. In addition to producing UHT milk, Devolli also
packages coffee and different juices. Abi Dairy (linked to Abi supermarkets) processes
about 20,000 litres of raw milk. Another growing dairy is Bylmeti.
•
Cereals (wheat, maize, barley) are the main cultures that cover the major part (70%) of the
cultivable land (arable land and gardens) in Kosovo. Production (2007): Wheat: ~250,000
tons; Maize: ~ 330,000 tons; Barley: ~11,000 tons (~86% for beer production). For the
latter, 36 farms growing barley for a single brewery.
•
Kosovo has 22 feed mills with an annual capacity of ~113,000 tons (2007). One of the
biggest is M&Sillosi in Xerxe, Rahovec, which was privatized several years ago.
•
Bakeries seem to be mainly small.
•
Vegetable production on 25-28,000 ha (mainly in regions Dukagjin and Anamorava), of
which about 200 ha greenhouse area. Vegetable production is estimated at ~200,000 tons
of potatoes, ~65,000 tons cabbage, ~100,000 tons of green peppers, ~55,000 tons
tomatoes. However, statistical data on overall fruit and vegetable production in Kosovo are
not always reliable, and differ often from source to source).
•
Fruit production on about 3,000 ha. Production (2006): Pears: ~15,000 tons, Apples:
~60,000 tons, Sour Cherries: ~ 3,500 tons, Plums: ~25,000 tons. Watermelons and melons:
~53,000 tons. Local demand cannot be met, although primary production has increased in
recent years. The majority of processed fruit products are imported.
•
There is a demand for high quality local produce from the supermarkets. The current
bottlenecks are missing post harvest handling capacities (cold storage, grading, and
packaging) and modern processing capacities. In 2007, it was estimated that local
processors cover just some 30% of local market needs for vegetables, and less than 10%
for processed fruit products, with the balance being imported.
•
Pestova is a leading potato producer and processor in Kosovo and one of Kosovo’s few
exporters. The company was founded in 1991, was severely damaged during the Kosovo
conflict in 1999, and resumed its activities in 2000. The company started with primary
production of potatoes, and later invested into production of crisps and potato frozen
products.
•
Abi & Elif 19, also known by its brand name Progress, is a processor of fruit and vegetable
products, i.e. marmalade, jams and jellies, ketchup, peppers, cucumbers, green bean and
other products. PAbi& Elif 19 is the most significant food processor of fruit and vegetables
in Kosovo with 150 employees.
•
Other smaller processors are MOEA (recently started fruit juice production), Dona, Tango,
Frutti (juice production based on concentrates.
•
In 1980s, Kosovo winemakers produced 50 mln litres of wine a year, of which up to 40 mln
litres were exported. However, about 50% of the vineyards were destroyed in the 1990s.
Now, there are about 5,000 ha vineyards. Production is taking place mainly in the south
and west of Kosovo. Processing capacities of wineries are ~ 125 mln litres (2007).
•
There were four formerly state-owned wineries with the following capacities, of which three
are now privatised. One of the privatised wineries is Stone Castle (“New Cellar“) in
Rahovec. Stone Castle produces about 10 mln litres and exports more than 90% of it.
Another private winery is Haxhijaha (“Old Cellar”)
•
•
There is own main brewery in Kosovo, the Peja Brewery, which is in Slovenian ownership.
Peja brewery is also distributing soft drinks.
Bonus Bonita, Lipijan, is the key producer and distributor of mineral water.
•
There is a small number of companies specialised in niche products, such as APS, Istog
(medical and aromatic plants), APC, Podujevo (forest fruits, mushrooms), and Trofta, Istog
(fish reproduction and production).
2.7
FYR Macedonia
2.7.1
About half of all agricultural land in FYR Macedonia is pasture, 40% arable land, with the rest
being land under permanent crops and meadows. Average farm size of private farms is 1.4 ha,
but there are also some larger agricultural companies leasing land from the state. Vegetables
and horticultural products make up the largest share of agricultural output (28%). Wine
represents about 7% of the agricultural output. The area under cereals shows a downward
trend, as imported wheat can be found at lower prices than domestic production. Regarding
animal production, pork meat contributes more than 40% to total domestic meat production,
followed by cattle (38%), sheep and goat.
FYR Macedonia is a net-importer of agri-food products (€550 mln exports and €440 mln imports
in 2009). The main food products exported are wine and other beverages, fruits, vegetables and
nuts. Half of Macedonian agri-food commodities are exported to the Western Balkans (among
which Serbia is the leading export market), followed by the EU markets. The main agricultural
import products are meat, products of milling industry, cereals, sugars and confectionary, dairy
produce, eggs, and honey. Import duties for agricultural products are relatively high, for some
fruit and vegetable as well as lamb carcasses 20-40%, and for wine and some processed
vegetables even as high as 45-50%. Import tariffs for beef meat, milk and butter are about 1325%. Import duties are low or zero for cereals and for agricultural machinery.
In FYR Macedonia, there is currently a strong expansion of supermarkets and hypermarkets
ongoing. So far, there are still various players in this field (Tinex, Veropulos, Skopski Pazar,
Kam Market), and further chains plan to enter this market (e.g. Mercator). In the processing
industry, the involvement of foreign companies is increasing, e.g. Imlek Serbia/DFG invested
into two dairies in Macedonia, and Agrokor invested in a winery and recently in a vegetable
wholesale market. A number of Greek investors are also present, e.g. Veropulos supermarket,
flour mill Zito Luks.
Sub-Sectors
Retail & Wholesale
Wine
Fruits and Vegetables
Tinex MT
Veropulos (Greece, Spar intern.)
Skopski Pazar (SP)
Kam Market
Tediko Super
Ramstore (Migros Turk)
Tikvesh
Skovin Winery
Povardaric (capital from Serbian)
Lozar Veles (Mac&Island capital)
Vila Marija (3 wineries)
Anska Reka Valandovo (Agrokor)
Vitaminka
Vori
Zora sped
Di EMGP
Bonum
Makedonija AG
Frukta
Sub-Sectors
Meat
Beer, Soft Drinks
Milk
Flour mills, bakeries
Edible oil
Confectionery / Snacks /
meal solutions
2.7.2
Pekabesko
MIK Sveti Nikole
Pivara Skopje
Pivara Prilep
Pivara Bitola
MD Mlekara Bitola (Imlek/DFG)
Dairy Ideal Sipka
Zdravje Radovo
Zito Luks (Greek ownership)
Zito Vardar
Brilijant oil factory,
Blagoj Gjorev-Kristal
Swisslion Skopje
Vitaminka AD
SWOT Analysis
Strengths
•
•
•
•
•
•
Weaknesses
Suitable climate, in particular for wine and F&V,
long tradition in agricultural production
Long tradition of wine export to the EU and to
Serbia and of vegetable export to other
countries in the region
Low labour costs
Crossroads of 2 main European transport
corridors, very low corporate tax, several
investment zones 10 years tax holidays
Agriculture is a priority of the Government
Processing companies have invested in
expansion, modernisation and quality control
•
•
•
•
Opportunities
•
•
•
•
Wine export mainly in bulk
leading partly to higher production
costs of primary production, and
difficulties in organising sufficient
quantities for export
Insufficient organisation of joint export
(problem of quantities)
Many processing companies are still
relatively small in size
Threats
Retail structures expanding rapidly, leading to
more demand for larger processing and
production units
Opportunities to increase export (bottled wine,
vegetables, and niche fruit products)
Opportunities for import substitution on the
domestic market
Duty free access to EU market (e.g. bulk wine
export quota); CEFTA member, incl. Export
opportunities via Serbia to Russia; Free-trade
agreement with Ukraine and Turkey
•
•
•
•
•
•
Relatively small market
(~2 million inhabitants)
Retail structures may be saturated
soon
Natural risks (draughts, floods)
Difficulties over the country’s name
leading to delays in the start of
negotiation for EU accession (even if
Macedonia is a candidate country)
and to difficulties for exports with
‘Macedonia’ label
Rural depopulation
2.7.3
•
The retail market was growing strongly until 2008, with expansion slowing down in 2009
due to the financial crisis. Most supermarkets/hypermarkets are in Skopje and in other
larger towns. The retailers are keen to boost their market shares by developing own
brands as well – a trend that has long been present in developed economies. Using their
own brands, retailers offer cheaper products, with free advertising, thus positioning
themselves better on the market. In Macedonia this trend is still at an initial stage.
•
Tinex is the Macedonian market leader (~25.5% market share, ~€80 mln turnover in 2009).
Tinex retail chain was established in 1994 and is the oldest and largest retail chain in
Macedonia. It boasts 32 stores and has a headcount of about 800 people.
•
Other larger retailer are Vero retail chains (~€50 mln turnover in 2009), Vero supermarkets
are part of Greek Veropulos retail chain, which is in turn part of the international chain
SPAR International. Veropulos entered the Macedonian market in 1997.
•
Kam market (~€36 mln turnover in 2009), and SP market (Skopski Pazar AD) (~€33 mln
turnover in 2009). Further, there are Tediko, Ramstore Market (Migros Turk) and Tus
(Slovenia), Mercator (Slovenia), Dauti Komerc, etc.
Meat and meat products
•
There has been a decreasing trend of livestock production in the last decade. FYR
Macedonia greatly depends on imported feed, maize, proteins and vegetable fats and well
as complete fodder mixture. Pig production is significant (40% of total meat production).
However, production is mostly small-scale for home-use. FYR Macedonia is a net-exporter
of lamb meat. However, there is a downward trend (2000-2008) in sheep production
because of reduction in the fodder base, high fodder prices, and low producer prices for
meat, milk and wool.
•
The Macedonian market for cooled and processed meat products is estimated by
Euromonitor (in: Gtai) to be 10,400 tons with a value of ~57 million EUR (2009).
•
Pekabesko a.d. is the market leader (23,5% market share, ~ €33 mln turnover in 2009),
followed by MIK Sveti Nikole a.d. (~ €15.7 mln turnover in 2009) and Promes (~ €17.1 mln
turnover in 2009). Others are, for example Soleta, Rimes, and Mega. All modern, larger
meat processors have HACCP and ISO 9001.
•
Average annual milk production is about 200 million litres (2000-2006). Productivity has
increased from 2000-2008, but is still far below the EU average. Most primary production is
taking place in small-scale entities. Due to a crisis in the processing sector (failure of
Swedmilk), milk prices and sales opportunities decreased. As a consequence, milking cows
were reduced.
•
Sales of dairy products amounts to ~ €0.2 bln (2009). The fastest growing product group of
nutrition/staples in 2009 was cheese with a value growth of 14%. However, average unit
prices decreased in 2009 due to the increasing share of economy brands in a number of
subsectors (Euromonitor International).
•
At the processing level, there are about 85 registered dairies, which are mainly small to
medium sized enterprises. Dairies have mostly been taken over by foreign companies, e.g.
from Serbia, Croatia . However, Swedmilk has gone bankrupt in 2009.
•
Market leaders are Mlekara Bitola AD-IMB (Imlek Serbia/DFG) with its brand bimilk (~ €29
mln turnover), Ideal Sipka a.d., Bitola (~ €13 mln turnover; owned by Dukat/Lactalis), and
Zdravje Radovo, Kumanovo (~ €11 mln turnover). Others are, for example, Beka
Company Eko Shar, Bucen Kozjak (Imlek/DFG), Rudine, Laktis, and Dairy Stip.
•
Swedmilk Makedonija started to operate near Skopje in June 2007, but went bankrupt in
2010.
•
Nearly half of the arable land is under cereal crops (i.e. about 200-250,000 ha), where wheat
is the dominant crop, followed by barley and maize. Average annual cereal production
amounts to ~ 564,000 tons. Sunflower was grown on about 6,000 ha (2000-2005), but there
was a significant decrease in 2006. Nowadays, most sunflowers are imported.
•
Large flour mills are Zito Vardar, Veles (~€26 mln turnover), Zito Luks a.d., Skopje (Elbisco
Holding, Greece) (~ €18 mln turnover)
•
Larger edible oil producers are Brilijant Oil factory (~ €34 mln turnover), and Blagoj
Gjorev-Kristal (~ €10 mln turnover).
•
Macedonia is a net exporter of processed and preserved vegetables, particularly
processed peppers and other preserved vegetables such as gherkins, cucumbers and
mushrooms.
•
Vegetable production reaches about 680-750,000 tons (2000-2006), of which 160193,000 tons potatoes. In 2007, the most significant vegetable production is in: tomatoes
(17%), peppers (19%), cabbage (14%), melons and watermelons (19%) and potatoes
(31%). The production takes place in open fields, in heated glass-house (260 ha), and
under plastic tunnels with or without heating.
•
Fruit production: Orchards on about 15,000 ha with an average annual total production of
125-150,000 tons, of which apples account for 50-60%, while the stone fruits (cherries, sour
cherries, peaches, apricots and plums) accounted for 35% (2000-2006). Fruit production is
mainly concentrated in the western part of the country. Apple production is mostly in the
Prespa area around Resen.
•
Larger companies are Vitaminka AD Prilep (~€19 mln turnover in 2009). Further, there is
Bonum (production and processing of mushrooms and of vegetable products), Vori Ltd.,
Zora Sped, Agro Komerc, Altra, DI EMGP, Frukta, Makedonija AG, Vipro, DIM Komerc and
a number of smaller processing companies.
•
Agrokor (Croatia) started construction of a wholesale and distribution centre in Strumica for
vegetables in autumn 2010. The market will contain cooling chambers, calibrators,
packaging halls and a transport system for admission and distribution of 20,000 tons of
industrial vegetables.
Wine / Grape production
•
Vine growing on about 25,000 ha (of which about 11,000 ha in the Tikvesh district) with an
average annual production of about 230-250,000 tons (2/3 for wine, 1/3 table grapes).
Wine is the main source of income for over 30,000 households. Macedonia produces
between 90 and 110 million litres of wine annually, with 90% of it exported in bulk and 10%
in bottles. Volume growth in wine export is predicted to be in the Serbian market.
•
Per capita wine consumption of 12 litres is still below that of traditional and established
wine producing countries (wine is still perceived as an occasional treat rather than an
everyday alcoholic drink).
•
There are more than 50 wineries in Macedonia, the largest of them being Tikves AD (~
€21 mln turnover in 2009). Tikves is a privately owned joint stock company (majority owned
by M6, a Macedonian investment group). The annual processing capacity is about 50,000
tons of grapes and about 35 million litres of wine. 60% of the production is exported, mostly
to former Yugoslav countries. Tikves together with Rici, a German company, created a new
mixed company ‘Tikves Wines International’ in Munich.
•
Other wineries are Skovin Winery, Bovin Winery, Fonko, Popova Kula Winery, Imako,
Povardaric, Aska Reka Valandovo (Agrokor), Rigo Impex, Vila Marija, Lozar Veles, Vinojug,
etc.
Beer and mineral water
•
Beer sales amounted in 2009 to ~ 94 million litres, ~ €144 mln Domestic manufacturers
dominate beer with almost 80% of sales (Euromonitor International). Macedonia is neither a
significant importer nor a large exporter of beer.
•
Market leaders are Skopje Brewery (~25% market share, ~€69 mln turnover in 2009),
Prilep Brewery (~€17 mln turnover in 2009) and Bitola Brewery.
•
A larger producer of bottled water is Gorska Voda.
Confectionary / Snacks / etc.
•
The market is dominated by products from international companies and companies of the
region (e.g. Kraftfoods, Unilever, Nestle, and Kras, Croatia).
•
Larger local companies are Vitaminka AD (see also fruits and vegetable, total ~€19 mln
turnover in 2009) and Swisslion Ltd, Skopje (~ €35 mln turnover).
2.8
Montenegro
2.8.1
Montenegro has a very small population, i.e. a small domestic market size. Most of the country
is covered by high mountains, therefore together about 88% of the agricultural land is used for
pastures and meadows. Only 9% of agricultural land is arable land and 3% of land is under
permanent crops. An agricultural census recently took place in 2010 and data will be available
soon. Production is mostly taking place in very small-scale structures. More than 2,500 ha are
regularly irrigated in the area close to Podgorica, including more than 2,000 ha of vineyards of
AD Plantaze.
Montenegro is a net importer of food. Most of the imports are from Serbia (in particular
fodder, livestock/meat, and milk). The total import value of agri-food products in 2008 was 426
mln EUR, compared to 46.7 mln EUR exports. More than half of the export value comes from
one group – beverages, of which EUR 17.2 mln comes from wine export. Other export products
are tobacco, fruits and vegetables, meat and meat preparations.
Except for retail chains and a few larger companies (such as 13-jul Plantaze), most other
companies in the country are of relatively small size.
Sub-Sectors
Retail & Wholesale
Delta (Delta Serbian)
Voli
Wine
13-jul Plantaze (state owned)
Meat
Mesopromet
Goranovic
Milk
Dairy Zora
Dairy Niksic
Bakeries
Aleksandrija, Daz
INPEK
Beer / Water / Soft Drinks
Niksic Brewery
Water Group
Confectionery
CRNAGORACOOP
2.8.2
SWOT Analysis
Strengths
•
•
•
Weaknesses
Montenegro has a positive image as a holiday
destination and ecological state (image
supportive for wine export)
13 jul Plantaze is one of the largest vineyards
in one place (~ 2.300 ha, most of it irrigated)
Low labour costs
•
•
•
•
Opportunities
•
•
Small-scale processing
(except for 13 jul-Plantaze)
Difficult logistics in the North (high
mountains, difficult access in winter)
Threats
Domestic market and tourist
Export markets for wine and some speciality
products (e.g. ham)
•
•
•
•
Very small domestic market
(only ~ 620,000 inhabitants)
Limited quantity of raw material
Dominance of foreign products
Natural risk (drought)
2.8.3
•
Voli is one of the leading retailers in Montenegro, owned by Voli Trade. Voli is a grocery
retailer operating about stores in Podgorica and in four other towns. The company employs
about 800 persons. The market share of Voli is about 10% (2009). Voli is a distributor of
Carnex, Vital and Albus (Serbia), Vindija (Croatia), Zora (Berane), and Suza (new water
brand, Montenegro).
•
Delta Holding, Serbia, opened the first larger shopping mall in Podgorica in 2008,
including a Maxi Supermarket. Further, Delta has a number of supermarkets in other
towns.
•
Montenegro needs to import livestock, meat and meat products. The demand for meat
products and the capacities of the local meat processors is much larger than can be
covered by local primary production. In particular, pigs / pig meat is imported, as local
production is not is constrained by insufficient fodder production in the country. The total
cattle population amounts to 106,000 head. Annual meat production is about 7,500 tons
cattle meat, 3,500 tons sheep meat, plus poultry and pig meat. A speciality of Montenegro
is smoked ham (however, with mostly imported livestock or meat as the basis).
•
Mesopromet DOO is the leading Montenegrin meat producer and processor holding about
30% of the market share in Montenegro. Mesopromet buys pork and young bull, beef and
chicken, and also established a network for selling its products. It produces smoked
products and sausages.
•
MI Goranovic Ltd Niksic is privately owned by the Goranovic family, since 1986. With a
daily capacity of 20 tons of meat products, MI Goranovic is one of the leading meat
processors.
•
Martex started as a family business and has continuously expanded. It operates a factory
producing traditional dried/smoked pork products near Cetinje.
•
There has been a downward trend regarding the size of livestock because of structural
problems and depopulation of rural areas. Annual milk production is 160,000 tons. Only 1520% of the total milk production is delivered to dairies, the rest is used in households for
fattening calves, making dairy products or direct sale on local markets.
•
Dairy Niksic is a private medium sized dairy. Dairy Zora AD was established by Lux
Development and later handed over to the Ministry of Agriculture. Dairy Podgorica is for
sale.
Bakeries, flour mills and edible oil
•
Cereal production is at a very low level, because of the special landscape of Montenegro.
Cereals are grown on 5,000 ha (2008), with more than half used for corn-maize production.
•
Aleksandrija, Daz d.o.o., Herceg Novi, and INPEK, Podgorica are larger bakeries
producing bread and various noodles‘ products. Sajo, Spuz is one of the larger flour mills.
•
Total annual fruit production: 30,000 tons of fresh fruits (23% oranges and tangerines,
19% plums, 16% apples).
•
Vegetable production 2008: on ~ 8,000 ha, of which 60 ha in greenhouses. Products are
cabbages, melons, tomatoes and peppers. Potato production on 10,000 ha, and
productivity shows an increasing trend.
•
13 jul-Plantaze, Podgorica (see also ‘wineries’) has a peach plantation of ~85 ha and
produces about 1200 tons/year. Most other producers and processors are relatively small
in size.
•
Vineyards cover 4,300 ha, of which about half is irrigated.
•
The most significant production is around Podgorica on the state owned vineyard and
winery 13 jul-Plantaze (~2,300 ha, the largest vineyard in one complex in Europe). The
capacity of the wine cellar is 30 million litres; sales are about 17 million litres annually. The
state owns ~52% of Plantaze. The company was founded in 1963, and it deals with
production of wine and table grapes, peach, production and distribution of wine and grape
brandies, fish growing, catering and retail trade. Products are exported to the region, but
also to EU, Russia, China and America. In 2008, the annual turnover was ~35 million EUR.
•
There is one dominant brand on the beer market: Niksic pivo. The brand is well-known not
only in Montenegro, but also in all of the Western Balkans, in particular in Serbia.
Accordingly, Niksic Brewery (Inbev) is the market leader for beer.
•
In recent years, there had been also more investments in water production. Bottled water
companies are Water Group d.o.o., Kolasin and Bjelasica-Rada AD, Bijelo Polje.
Confectionary and niche products
•
Niche production in Montenegro is mostly taking place at small scale level.
•
Crnagoracoop in Crikvenica / Danilovgrad is a larger producer of coffee, tea, chocolate,
and biscuits. It has an ISO 22000:2005 certificate.
•
Olives and olive oil: Olive growing occupies 3,200 ha. The production potential of ~2,000
tons olive oil is only 50% exploited. Olive oil in attractive bottles is sold to tourists.
Olioprom, Bar, is one of the oil producing companies.
•
Fish: 13 jul Plantaze produced 86 tonnes of trout in 2008.
ANNEX:
1.
BIBLIOGRAPHY a n d
INTERESTING LINKS
Serbia
− Balkan Regional Center for Trade Promotion. Balkan Trade Bulletin. Serbia
− Business Monitor. Serbia – Food & Drink Report. London: 2010
− Economist media group. TOP 300. 2008
− Ekonomski Institut. Sector Study in the Field of Agriculture and Food Industry in
AP Vojvodina. Novi Sad: 2010
− Exporter. Belgrade: 2010
− InterCapital Securities. Serbian Food & Beverages. Belgrade: 2010
− Ministry of Agriculture, Forestry and Water Management. Rural Development
Strategy 2010 – 2013. Belgrade: 2009.
− Serbia Investment and Export Promotion Agency (SIEPA). Fruit Industry in
Serbia.
− SIEPA. Vegetable Industry in Serbia.
− USAID. Cultivated Berry Value Chain Assessment. USAID Agribusiness
Project. Serbia: 2008
− USAID. Dairy Value Chain Assessment. USAID Agribusiness Project. 2008
− USAID. Herbs, Mushrooms, and Forest Fruit (Medicinal and Aromatic Plants):
Value Chain Assessment. USAID Agribusiness Project. 2008
− USAID. Tree Fruits. Value Chain Assessment. USAID Agribusiness Project.
− USAID. Vegetable Value Chain Assessment. USAID Agribusiness Project.
Serbia: 2008
2.
Croatia
− AgriPolicy- Enlargement Network for Agripolicy Analysis: AN ASSESSMENT
OF THE COMPETITIVENESS OF THE DAIRY FOOD CHAIN IN CROATIA,
2009. ww.agripolicy.net
− Business Monitor International. Croatia Food and Drink Report Q4 2010.
London: 2010
− Croatian Chamber of Economy. Croatian Exhibitors, Prodexpo 2008, Zagreb:
2008
− Lider 2010: Who is Who: Prehrambena industrija. www.liderpress.hr
− Ministry of Agriculture, Fisheries and Rural Development of the Republic of
Croatia. Croatian Agriculture. Zagreb: 2009
− Royal Danish Embassy Zagreb, Trade Council of Denmark: Food & retail
market in Croatia, 2007
1
3.
− Euromonitor International. Bottled Water in Bosnia-Herzegovina. London: 2010
− Euromonitor International. Confectionary in Bosnia-Herzegovina. London: 2009
− Foreign Investment Promotion Agency of Bosnia and Herzegovina. Agriculture
and Food Processing Industry. Sarajevo: 2005
− GFA Consulting Group/USAID. Trade Capacity Assessment for BiH Exports.
Hamburg: 2007
− GTZ. Development Studies for Sectors with Potential. Food Sector Study.
Eschborn: 2001
− Ministry of Foreign Affairs. Danish Support to Credit Programme in Support of
Micro, Small and Medium Enterprises (MSMEs). Programme Document. Final
Report. Copenhagen: 2009
− RZB Group. Market Profile - Bosnia. 2009
− The World Bank. Project Appraisal Document in a Proposed Credit in the
Amount of SDR 13.8 Million to Bosnia and Herzegovina for an Agriculture and
Rural Development Project. Washington: 2007
− USAID Sarajevo Office. Investment Opportunities in Bosnia and Herzegovina.
Sarajevo
4.
Moldova
− American Chamber of Commerce in Moldova. Products of Moldova. Chisinau
− Germany Trade & Invest. Wirtschaftstrend Kompakt Republik Moldau. Berlin:
2010
− GFA Consulting Group. Export Marketing Survey: German Market for Fruits and
Vegetables. Export Promotion project funded by the EU. Chisinau: 2009
− GFA Consulting Group. Export Market Survey: Fruits and Vegetables Market –
Ukraine. Export Promotion Project funded by the EU. Chisinau: 2009
− GTZ. Überblick über den landwirtschaftlichen Sektor in der Republik Moldau.
Chişinău
− Ministry of Agriculture and Food Industry of the Republic of Moldova. AgroIndustrial Sector. Chisinau: 2009
− Ost-West Contact. Special Moldau. Berlin: 2010
− USAID CEED 2009: Moldovan Wine sector appraisal, prepared by Chemonic
− Various internet based information of USAID-CNFA Agriculture Development
Project in Moldova
5.
Albania
− Albinvest: Fact sheets 2008
− AgriPolicy- nlargement Network for Agripolicy Analysis: AN ASSESSMENT OF
THE COMPETITIVENESS OF THE DAIRY FOOD CHAIN IN ALBANIA, 2009.
ww.agripolicy.net
− Danish Ministry of Foreign Affairs. Programme Document, Value Chains for
Sustainable Livelihoods VCSL, Albania. Copenhagen: 2009
2
− DSA 2009: Olive Oil Value Chain, Authors: Luciano Leoneti et al.
− Ministry of Agriculture and Food, Albania: Sector Strategy of Agriculture and
Food 2007 – 2013
− Royal Danish Embassy in Tirana. Food Agriculture and Agro Business (FAA).
2010. http://www.ambtirana.um.dk
− World Bank. Joint IBRD – IFC Country Partnership Strategy for Albania for the
period FY11-FY14. Washington: 2010
− World Bank. Albania, Strategic Policies for a More Competitive Agriculture
Sector. Washington: 2007
− World Bank: Strategic Policies for more competitive agriculture sector, 2007
6.
Kosovo
− Chemonics International. Kosovo’s Meat Market Potential. Kosovo Cluster and
Business Support project, financed by USAID. 2005
− Chemonics International. Dairy Market Assessment Study. Kosovo Cluster and
Business Support project, financed by USAID. 2008
− Danida. Employment Promotion through Business and Skills Development 2008
– 2012. Programme Document. 2007
− EAR Marketing Support Project: Wine Sector Producer, Wholesaler & Trader
Survey (Draft)
− Ministry of Foreign Affairs/Danida. Project Description Document. 2005
− Ministry of Trade and Industry. Top Enterprise 2009. Pristine
− Ministry of Trade and Industry. Trade Exchanges of Kosova. Pristine: 2008
− Ministry of Trade and Industry. Agriculture and Food Processing Industry.
Pristine: 2008.
− Privatisation Agency of Kosovo. Annual Report 2009. Skopje: 2009
7.
Macedonia
− Agency for Foreign Investment of the Republic of Macedonia. Food Processing
Industry Investors’ Guide 2007.
− Euromonitor International. Alcoholic Drinks in Macedonia. London: 2009
− Euromonitor International. Frozen Processed Food in Macedonia. London: 2009
− Faculty of Agriculture and Food. Challenges faced by the Agro-food Sector in
the Republic of Macedonia regarding its Integration in the EU Markets: Skopje.
− GFA. Horticulture Marketing Study. Hamburg: 2000
− Price Waterhouse Coopers. Guide to doing Business and Investing in
Macedonia. Skopje: 2010
− The World Bank. Implementation Completion Report on a Credit in the Amount
of SRD 5.4 Million to the FYROM for a Private Farmer Support Project.
Washington: 2003
3
8.
Montenegro
− Directorate for Development of Small and Medium–sized Enterprises.
Montenegro Business Guide. Podgorica.
− Ministry of Agriculture, Forestry and Water Management. Montenegro’s
Agriculture and European Union - Agriculture and Rural Development Strategy.
Final Report of the EU funded Project. Podgorica: 2006
− The Royal Danish Ministry of Foreign Affairs / Montenegrin Ministry of
Agriculture, Forestry and Water Management. Programme Document. Organic
Agriculture Development Programme Montenegro 2009 – 2011. Copenhagen:
2008
9. South-Eastern European Countries
− AHK, Deutsche Auslandshandelskammern. Konjunkturbericht MOE 2010. 2010
− Bundesministerium für Ernährung, Landwirtschaft und Verbraucherschutz.
Deutscher Agraraußenhandel 2009. Berlin: 2010
− Commission of the European Communities. Commission Staff Working Paper.
EU regionally relevant Activities in the Western Balkans 2008/09. Brussels:
2009
− Commission of the European Communities. Communication from the
Commission to the European Parliament and the Council. Western Balkans:
Enhancing the European Perspective. Brussels: 2008
− DEG. Annual Report 2004. Cologne: 2005
− DEG. Auslandsdirektinvestitionen
Cologne
in
Entwicklungs-
und
Reformländern.
− Eurochambres. Obstacles to Investing in the Western Balkans. The View of the
Private Sector. Brussels
− European Bank for Reconstruction and Development. Agribusi9ness Sector
Strategy. London: 2010
− FAO/EBRD. Review of the Sugar Sector. Serbia and Montenegro. 2004
− Gärke, Inge. Strategic Location Planning – for Foreign Direct Investments in the
Food Industry and Agribusiness in South East Europe - . Hamburg: 2005
− IAMO. Agriculture in the Western Balkan Countries. Halle: 2010
− Noleppa, Steffen. Territoriale Entwicklung im ländlichen Raum Südosteuropas.
Analysen und Handlungsempfehlungen für die Erstellung eines Konzepts. 2010
− Podkaminer, Leon. Assessing the Demand for Food in Southeast Europe by the
years 2015 and 2020.
− UNDP. Review of Growing Sustainable Business Project in BiH, Macedonia,
Moldova, Serbia and Turkey. 2007
− The World Bank/IFC. Doing Business 2010. Reforming through Difficult Times.
Washington: 2009
− The World Bank. Enhancing Regional Trade Integration in Southeast Europe.
World Bank Working Paper. Washington: 2010
Further, information was taken from various websites
(of companies, of chambers of commerce, foreign investment agencies, news
agencies, etc.)
4
Interesting Links
Organisation
Ministries of Agriculture
Website
Albania
(only on entity level, at state level: Sector for
Agriculture at the Ministry of Economy)
Croatia
Kosovo
Macedonia
Moldova
Montenegro
Serbia
Ministries of Economy
www.mbu.gov.al
www.fbihvlada.gov.ba (Federation)
Albania
Bosnia & Herzegovina
Croatia
Kosovo
Macedonia
Moldova
Montenegro
Serbia
www.mete.gov.al
www.mvteo.gov.ba
www.mingorp.hr
http://mef-rks.org
www.economy.gov.mk
www.mec.gov.md
www.minekon.gov.me
www.merr.gov.rs
www.vladars.net (Republika Srpska)
www.mvteo.gov.ba (Ministry of Economy, BiH)
www.mps.hr
www.ks-gov.net
www.mzsv.gov.mk
www.maia.gov.md
www.minpolj.gov.me
www.minpolj.gov.rs
Investment Promotion
Agencies
Albinvest, Albania
FIPA, BiH
Trade and Investment Promotion Agency, Croatia
Remark: The Act on the Termination of the
Croatian Trade and Investment Promotion
Agency became active with the 8th of November
2010 (Official Gazette 124/2010).
IPAK, Kosovo, and
Office Vienna
Agency for Promotion of Entrepreneurship,
FYR Macedonia
MIEPO, Moldova
MIPA, Montenegro
SIEPA, Serbia
www.albinvest.gov.al
www.fipa.gov.ba
www.apiu.hr; www.croinvest.org
www.invest-ks.org;
www.ipak-vienna.org; www.eciks.org
www.apprm.gov.mk
www.miepo.md
www.mipa.co.me
www.siepa.gov.rs
Chambers of Commerce (or
Trade, Economy)
Albania
Croatia
Kosovo
FYR Macedonia
Moldova
Montenegro
Serbia
www.cci.al
www.komorabih.ba
www.hgk.hr
www.oek-kcc.org
www.mchamber.org.mk
www.chamber.md
www.pkcg.org
www.pks.rs
5
Organisation
Statistical Offices
Website
Albania
Croatia
Kosovo
Macedonia
Moldova
Montenegro
Serbia
General information and
statistical data
www.instat.gov.al
www.bhas.ba/new
www.dzs.hr
http://esk.rks-gov.net
www.stat.gov.mk
www.statistica.md
www.monstat.cg.yu
http://webrzs.stat.gov.rs
Eurostat
FAO
World Bank
East Agri Network
Euromonitor
Nov-Ost Info
CEFTA
http://eurostat.ec.europa.eu
http://faostat.fao.org
http://data.worldbank.org
www.eastagri.org
www.euromonitor.com
www.nov-ost.info
www.cefta2006.com
www.ceftatradeportal.com
http://exporthelp.europa.eu
www.gtai.de
EU Export Help Desk
GTAI
Financing Organisations
DEG
EBRD
IFC
EIB
www.deginvest.de
www.ebrd.org
www.ifc.org
www.eib.org
Regional associations in
Germany
OA
OMV
www.ost-ausschuss.de
www.o-m-v.org
6

Food Industry Study in Southeast Europe Final

Transcription

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