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  • Food Processing Export Strategy Cheese Action Plan

    Consultation Document - Draft Final -

    Project: Trade Enhancement Programme A (TEP-A Lot 2, Comp 4)

    Assignment: 4.15.10 Policy and Capacity Building: Food Processing Export Council

    Author: Paul Baker Date: September 2007

    Disclaimer: The views and propositions expressed herein are those of the expert (Paul Baker) and do not necessarily represent any official view of the European Commission or any other organisations mentioned in the Report

  • Export Strategy for Processed Food Cheese Action Plan

    Paul Baker September 2007 i

    Preface This report has been produced as part of an assignment to support capacity building of the Food Processing Export Council (FPEC) in order to ensure that the Council is able to perform and act as a qualified partner for the Ministry of Trade and Industry (MTI), representing and serving the development of the Egyptian food processing sector. The purpose of the report is to briefly analyse the export situation of the cheese sector and to put-forward suggestions for a possible series of actions to support cheese exports (Action Plan). In its current form, the report attempts to raise a number of relevant issues to be addressed by the industry, and policy-making and support institutions, as part of the development of an industry-wide medium-tern strategy for cheese exports. Finally, the reader should note that the views and propositions expressed in this report are those of the author and do not necessarily represent the views of the European Commission (funding agency), COPCA (contractor), the Egyptian Food Export Council (beneficiary) or any other organisation mentioned in the Report.

  • Export Strategy for Processed Food Cheese Action Plan

    Paul Baker September 2007 ii

    Table of Contents

    1. Introduction ............................................................................................................. 1 1.1. Food Export Strategy Recommendations .............................................................. 1 2. Global context: diary and cheese developments ................................................... 3 2.1. Dairy sector situation in mid-2007 .......................................................................... 3 2.2. Dairy sector short-term prospects .......................................................................... 5 2.3. Demand side developments ................................................................................... 5 2.4. Supply side developments...................................................................................... 8 2.4.1. Processed cheese developments (European Union)..................................... 10 2.4.2. Prospects for cheese in the European Union................................................. 11 2.4.3. Prospects for cheese in Middle East and North Africa................................... 13 2.5. Trade patterns....................................................................................................... 16 2.5.1. Global trade patterns ...................................................................................... 16 2.5.2. Gulf Region trade patterns ............................................................................. 17 2.6. Global supply demand balancing ...................................................................... 18 3. Egypts strategic positioning ................................................................................. 19 3.1. Brief overview of the Egyptian cheese sector. ..................................................... 19 3.2. Current export position ......................................................................................... 20 3.3. Strategic issues..................................................................................................... 24 3.3.1. Scenarios for future development................................................................... 24 3.3.2. Geographical market focus............................................................................. 26 3.3.3. Other issues.................................................................................................... 32 4. Outline cheese export action plan ...................................................................... 35 4.1. Current situation.................................................................................................... 35 4.2. Strategy development: defining, agreeing and aligning priorities ........................ 35 4.3. Overview of key issues and action areas............................................................. 37 4.3.1. Assessment of future prospects and scenarios for the cheese sector .......... 37 4.3.2. Enhancing awareness and information on international markets .................. 38 4.3.3. Image building and awareness raising ......................................................... 39 4.3.4. Export market diversification .......................................................................... 41

  • Export Strategy for Processed Food Cheese Action Plan

    Paul Baker September 2007 iii

    Index of Tables Table 1 Cheese consumption and growth by region................................................... 6 Table 2 Per capita cheese consumption and growth by region .................................. 6 Table 3 Cheese imports and growth by region............................................................ 7 Table 4 Cheese production and growth by region ...................................................... 9 Table 5 Cheese exports and growth by region............................................................ 9 Table 6 EU15 production of processed cheese (2001-2005) ................................... 10 Table 7 EU15 exports of processed cheese (2001-2005) ........................................ 11 Table 8 GCC: imports of cheese and curd (HS 0406) in 2005 ................................. 17 Table 9 Egypt cheese exports: value 2005 2007 ................................................... 21 Table 10 Egypt cheese exports: volume 2005 2007 ................................................ 21 Table 11 Egypt cheese exports: average unit values 2005 2007 ............................ 21 Table 12 Egypt cheese exports: main markets by value 2005 2007 ....................... 22 Table 13 Egypt cheese exports: main markets by volume 2005 2007 .................... 22 Table 14 Egypt cheese exports to COMESA .............................................................. 23 Table 15 Egypt cheese exports to other sub-Saharan Africa.................................... 23 Table 16 Country specific tariff quotas for cheese applied by the EU ........................ 29 Index of Figures Figure 1 Monthly index of international prices of dairy products (98-00=100)............. 4 Figure 2 EU stocks of skim milk and butter .................................................................. 4 Figure 3 Prices of milk in selected countries, and indicative world price ..................... 4 Figure 4 EU export shares of world markets ................................................................ 4 Figure 5 Outlook for the EU cheese market (million tonnes), 1991-2014.................. 13 Figure 6 Cheese trade flows (>= 10,000 tonnes) ....................................................... 16 Index of Boxes Box A International investments in cheese production in MENA ............................... 15 Box B: ESR recommendations for a brand orientated approach for white cheese..... 27

  • Export Strategy for Processed Food Cheese Action Plan

    Paul Baker September 2007 iv

    List of Acronyms ABARE Australian Bureau of Agricultural and Resource Economics ALEB Agricultural-Led Export Businesses Project (funded by USAID) CAP Common Agricultural Policy (European Union) CIS Commonwealth of Independent States COMESA Common Market for Eastern and Southern Africa EAC East African Community EFPS Egyptian Food Processing Sector EGP Egyptian Pound ESR Export Strategy Report (Food Export Strategy Study PS137 Final Report,

    STEM-VCR, May 2006, for IMC) EU European Union EU-10 Member States that joined the European Union on May, 1st 2004 EU-15 Member States of the European Union before May, 1st 2004 FAO Food and Agriculture Organisation of the United Nations FAPRI Food and Agricultural Policy Research Institute FDI Foreign Direct Investment FP Food Processing FPI Food Processing Industry FPEC Food Processing Export Council FSR Food Sector Review (Egyptian Processed Food Sector Review Final Report

    ECORYS-NEI, May 2005, for IMC) GCC Gulf Cooperation Council GOEIC General Organization for Exports and Imports Control IMC Industrial Modernisation Centre IPRT Inward Processing Relief Traffic MENA Middle East and North Africa MFN Most Favoured Nation MTI Ministry of Trade and Industry NDM Nonfat Dry Milk OECD Organisation for Economic Cooperation and Development SMP Skim Milk Powder SWOT Strengths, Weaknesses, Opportunities, Threats TARIC Integrated Tariff of the European Communities TEP-A Trade Enhancement Programme A ToR Terms of Reference TRQ Tariff Rate Quota WMP Whole Milk Powder

  • Export Strategy for Processed Food Cheese Action Plan

    Paul Baker September 2007 1

    1. Introduction

    This Report is intended as a consultation document, providing background analysis of international and Egyptian cheese trade performance, leading to development of an outline Action Plan for cheese exports. Through the document a range of issues are raised that in the opinion of the author should be addressed as part of a comprehensive Export Strategy and Action Plan for the cheese sector. Deliberately, the document tries to focus on aspects that are specifically relevant for enhancing exports but it is recog