1
Annual Na(onal Workshop for Dairy Economists and Policy Analysts
Session II: Interna(onal Markets and Policy
Developments and Status of European Dairy Markets
Véronique Pilet, CNIEL, France Boston, May 13 & 14 2013
Recent developments in the world
2
World dairy produc(on (all categories included)
Geographic breakdown of world milk produc(on in 2012 (million tonnes)
World total: 760 million tonnes
Europe 219 29% EU-27 159 Russia 32 Ukraine 11 Belarus 7
Asia 282 37% India 132 China 45 Pakistan 33 Turkey 17 Africa 39
5% Sudan 8 Egypt 6 Kenya 4
Central America 17 2% Mexico 11
N. America 99 13% United States 90 Canada 8
S. America 71 9% Brazil 33 Argentina 12 Colombia 8
Oceania 29 4% New Zealand 20 Australia 9
FAO Food Outlook November 2012, IDF-DCANZ for NZ
Asia s(ll biggest contributor to milk output increase
Evolu(on of dairy produc(on (all categories included) 2007 to 2012
World total: + 84 million tonnes
Europe + 6 Mt
Asia + 44 Mt
Africa + 8 Mt South America + 15 Mt
Oceania + 4 Mt
CNIEL / IDF, FAO Food Outlook Mt: million tonnes
North & Central America + 6 Mt
World average annual growth rate
+ 2.4%
3
Growth dynamics in main dairy producing countries (1/2)
CNIEL / FAO Food Outlook
70
80
90
100
05 06 07 08 09 10 11(e) 12(p)
80.3 82.5 84.2 86.2 85.9 87.5 89.0 90.2
Million tonnes
+ 1.7% / year
USA
140
150
160
05 06 07 08 09 10 11(e) 12(p)
147 146
152 154 153 155 158 159
+ 0.9% / year
EU 25, 27
- 0.6%
Million tonnes
10
14
18
22
05 06 07 08 09 10 11(e) 12(p)
14.6 15.2 15.9 15.6 17.0 17.1
18.9 20.4
+ 4.9% / year
New Zealand Million tonnes
25
30
35
40
05 06 07 08 09 10 11(e) 12(p)
29.7 31.2 33.2 33.1 34.4 35.5
31.8 32.5
+ 3.6% / year
Pakistan
- 4.3% / year + 1.3% / year
Million tonnes
4
NB : deliveries in Europe and Japan
CNIEL / USDA, ZMB, PZ, Alimentos argentinos, DCANZ, Dairy Australia
6
7
8
9 Million tonnes
2010 2011 2012
Japan
2013
83
85
87
89
91
93 Million tonnes
2010 2011 2012
United States
2013 133
135
137
139
141
143 Million tonnes
2010 2011 2012
EU 27
2013 15
17
19
21 Million tonnes
2010 2011 2012
New Zealand
2013
30
31
32
33 Million tonnes
2010 2011 2012
Russia
2013
6
8
10
12 Billion litres
2010 2011 2012
Australia
2013
4
6
8
10 Billion litres
2010 2011 2012
Argentina
2013
Growth dynamics in main dairy producing countries – rolling 12 month basis
Geographical varia(ons of dairy product consump(on
Apparent dairy product consump(on levels in 2012 (kg per capita)
CNIEL / IDF, FAO Food Outlook, PRB
World average: 108 kg/capita Less than 50 kg
50 to 100 kg
100 to 200 kg
More than 200 kg
China 38
India 105
Indonesia 13
Japan 71
Philippines 10
Iran 90 Algeria
153 Mexico 108
Argentina 237
Brazil 173
USA 276
Canada 242
EU 287
Russia 245
Australia 309
5
Geographical varia(ons of dairy product consump(on
CNIEL / IDF, FAO Food Outlook, PRB
Apparent per capita consumption (kg – in milk equivalent)
2006 2012 %
World 101 108 +7
Asia 61 71 +16
Africa 42 48 +14
Latin America 129 151 +17
Russia + Ukraine + Belarus 253 255 +1
EU + North America + Australia + New Zealand
290 284 -2
Income and dairy consump(on in the BRIC countries
NB : Human consumption of dairy products, butter excluded, in milk equivalent ; losses and dairy used as animal feed excluded.
CNIEL / FAOSTAT, FMI
0
50
100
150
200
0
4000
8000
12000
71 76 81 86 91 96 01 06 11
GNP per capita (USD) Dairy product consumption per capita (kg)
Russia (USSR before 1992)
0
10
20
30
40
0
2,000
4,000
6,000
71 76 81 86 91 96 01 06 11
GNP per capita (USD) Dairy product consumption per capita (kg)
China
0
20
40
60
80
0
500
1000
1500
71 76 81 86 91 96 01 06 11
GNP per capita (USD) Dairy product consumption per capita (kg)
India
0
50
100
150
0
4,000
8,000
12,000
71 76 81 86 91 96 01 06 11
GNP per capita (USD) Dairy product consumption per capita (kg)
Brazil
6
*Russian imports do not account for volumes originating from Belarus NB: Evolution of imports based on volume
CNIEL / Ubifrance, national customs
Demand is sustained on main markets
Recent import tendencies on substan(al markets
United States Import January 2013 / 12 months 2012
Cheese : - 1% / + 8% Caseins : + 15% / - 3%
Japan Import 2 months 2013 / 12 months 2012
Cheese : + 1% / + 9%
China Import 2 months 2013 / 12 months 2012
SMP : - 34% / + 29% WMP : + 50% / + 27% Whey : - 6% / + 10%
Russia Import* 2 months 2013 / 12 months 2012
Butter : + 60% / - 8% Cheese : + 12% / + 7%
Brazil Import 2 months 2013 / 12 months 2012
WMP: - 37% / + 29% Cheese : - 22% / - 29%
Algeria Import 11 months 2012
SMP: - 12% WMP: - 8%
Presence on the world market Recent export tendencies among major suppliers of the world market
NB: Evolution of exports on a volume basis
CNIEL / USDA, Dairy Australia, Commission, ZMB, Ubifrance, national customs
Australia Export January 2013 / 12 months 2012
SMP: + 4% / + 21% WMP: - 54% / - 3%
Cheese : + 5% / stable
United States Export January 2013 / 12 months 2012
SMP: - 19% / + 2% Cheese : + 13% / + 16%
Argentina Export January 2013 / 12 months 2012
WMP: - 27% / - 1% Cheese : - 10% / - 10%
EU - 27 Exports 12 months in 2012
Skim milk powder: +1% Whole milk powder: -1%
Butter: +8% Cheese: +14%
Whey: +7%
New Zealand Export 2 months 2013 / 12 months 2012
SMP: + 17% / + 9% WMP: + 21% / + 15% Butter : - 14% / + 8%
Butter oil : + 26% / + 33% Cheese : + 17% / + 25%
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Global dairy product trade
Global trade structura(on of Dairy Products in 2012* (in milk equivalent – FAO methodology)
53 million tonnes
7% of global production
* Except intra-EU trade
Main supplying countries (%)
New Zealand 32
European Union 24
United States 10
Australia 6
Argentina 4
Belarus 4
Top 2 : 56 % Top 5 : 76 %
Main markets (%)
China 12
Russia 6
Saudi Arabia 6
Mexico 5
Algeria 5
Indonesia 3
Top 2 : 18 % Top 5 : 34 % CNIEL / FAO
1
2
3
4
5
6
WMP
2008 2009 2010 2011 2012 2013
World market prices booming
FOB price in Oceania US$ 1,000 / tonne up until April 2013
CNIEL / USDA
1
2
3
4
5
Butter
2008 2009 2010 2011 2012 2013
1
2
3
4
5
6
SMP
2008 2009 2010 2011 2012 2013
2
3
4
5
6
Cheddar cheese
2008 2009 2010 2011 2012 2013
8
Farmgate milk prices throughout the world…
NB: fat and protein content references differ from one country to another.
CNIEL, Alimentos argentinos, ZMB, USDA, China Dairy
250
300
350
400
jan fév mar avr mai jun jul aou sep oct nov déc
€ / 1000 litres
2011
USA 2012
2013
220
250
280
310
jan fev mar avr mai jun jul aout sep oct nov dec
€ / 1000 litres
2011
Argentina
2012
2013
340
370
400
430
jan fev mar avr mai jun jul aout sep oct nov dec
€ / 1000 litres
2011
Russia
2012 2013
300
350
400
450
jan fév mar avr mai jun jul aou sep oct nov déc
€ / 1000 litres
2011
China 2012 2013
…Absorbed by high input prices
Eurostat, USDA, CLAL
100
300
500
700 09 11 13
USD / tonne 07
Soya meal Brazil FOB
45-46% proteins 0
50
100
150 09 11 13
USD / baril 07
Brent crude oil spot FOB
100
150
200
250
300 13
€ / tonne
07 09 11
Feed wheat Market price- European average
100
150
200
250
300 13
€ / tonne
07 09 11 Fodder maize
Market price – European average
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European Markets
10
Cow’s milk deliveries
6,0
11,7
30,2
24,5
1,9
3,0
13,6 5,4
4,9
10,9
2,9
0,9 1,4
0,9
0,7
0,5
0,7
0,5
0,7
1,4
9,8
Cniel / Eurostat, ZMB
More than 15 million tonnes
5 to 15
1 to 5
Less than 1
2,4 3,3
2,3
0,2 (Cyprus) 0,04 (Malta)
0,3
Year 2012 Total EU 27 : 140,7 million tonnes
100
110
120
130
140
150
96 98 00 02 04 06 08 10 12
EU15 EU 25
Cow’s milk deliveries
Million tonnes
EU 27
Ireland, Germany, Netherlands & France most dynamic countries
-22%
-16%
+1,2%
-11%
-34%
+7,1%
-3,2%
+6,0%
+8,3%
+7,4%
Cniel / Eurostat, ZMB
Strong progress (> 5%)
Moderate progress (0 to 5%)
Moderate decline (0 to -5%)
Strong decline (< -5%)
+6,4 %
Cyprus
- 0,1%
+4,1%
+6,0%
Strong ambition to grow:
Ireland (+ 50% between 2010 and 2020) Germany (+ 10 Mt within 10-15 years) The Netherlands (+ 1 Mt after the end of quotas for FrieslandCampina) Austria (+ 25% after the end of quotas ) ….
Evolution of milk deliveries between 2007 and 2012
11
10.8
11.2
11.6
12.0
00/01 02/03 04/05 06/07 08/09 10/11
Netherlands
Quota
Deliveries
million tonnes
+0,5%
excess
4.9
5.2
5.5
5.8
00/01 02/03 04/05 06/07 08/09 10/11
Ireland
Quota
Million tonnes
+1,1%
excess
Deliveries
27
28
29
30
00/01 02/03 04/05 06/07 08/09 10/11
Germany
Quota
Million tonnes
+0,1%
excess
Deliveries
22
23
24
25
26
00/01 02/03 04/05 06/07 08/09 10/11
France
Quota
Million tonnes
-3,6%
Under-use
Deliveries
Cniel / European Commission
Ireland, the Netherlands and Germany are for now limited by quotas. France is reac(ng (or used to react) differently.
Quota u(lisa(on
Under-‐use and excess of milk quotas in Europe
Excess
Limited under-use (< 3%)
Significant under-use (3 à 6%)
Considerable under-use (> 6%)
Situa(on by member state in 2011/12
Malta
Cyprus
110
120
130
140
150
00/01 02/03 04/05 06/07 08/09 10/11
UE
Quota
Deliveries
Million tonnes
-4,7%
Overall under-use
EU 15 23 25 27
12
Amplified vola(lity on global markets finds its way to European internal markets
1
2
3
4 1 000 € / tonne
European SMP prices
01 13
1
2
3
4 1 000 € / tonne
World butter prices
01 13
1
2
3
4 1 000 € / tonne
World SMP prices
01 13
2
3
4
5 1 000 € / tonne
European butter prices
01 13
200
300
400
01
€ / 1 000 litres
13
Farmgate milk price
In Germany
NB : European quotations measured in France
CNIEL / FranceAgriMer, ZMB
Implementa(on of the Milk Package
Milk Package Reg. 1234/2007 (Single CMO) as amended by European Parliament Reg. 261/2012 with a specific part on « milk and dairy products ». Adopted 14th March 2012 – applica(on 2nd April 2012 un(l 2020
Main aspects: Contractual rela4ons between a milk producer and his client can be specified
in wri(ng
Nego(a(ng power : possibility to create Producers Organisa4ons (or PO Associa(ons) with or without transfer of ownership – no change for exis(ng coopera(ves which keep their status
Max. size : 3,5% of EU milk i.e. 5 billion litres
POs must be declared to the Member State
Transparency : processors must declare to the Member State the collected volumes each month
Inter-‐branch organisa4ons (IBO) can be recognised by Member States
PDO/PGI cheese supply regula(on allowed
13
A greener CAP
30% of subsidies linked with environmental measures
A fairer subsidy distribu4on
Single payment per hectare per member state
Moderate rebalancing of na(onal envelopes
Capping of payments per farm
Targe(ng of support to ac(ve farmers only
More funds for young farmers and small producers
More compe44veness to guarantee food security
Emergency measures in case of a crisis: interven(on, mutual funds
Rural development support jointly funded by the Community and Member States
Simpler procedures
CAP reshaping process 2013-‐2020
Evolu(on of CAP expenditure (1980 – 2020)
Notes: - 2011 = Budget; 2012 = Budget prévisionnel; - 2013 = Sous plafonds FEAGA pour paiements direct et dépenses de soutien des marchés + engagements pilier 2. Les montants développement rural 2013 inclus la modulation volontaire UK et Article 136 “montants non dépensés”. Comme ceux-ci s’arrêtent fin 2013, les montants correspondant sont intégrés dans les aides directes à partir de 2014.
DG AGRI
14
Dairy Europe and its mul(ple faces
A region present on the global market showing a poten(al for growth…
…but facing a number of uncertain(es:
A new vola(lity, The end of the quotas, Reform of dairy policies with different impacts
according to the zones
CONCLUSION