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The Warsaw Voice » Special Sections » October 26, 2012
Polska… tastes good!
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Dairy Exports on the Rise
October 26, 2012   
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Poles are eating more dairy products these days. The country’s dairy product exports are also growing.

Today the average Pole consumes 190-191 liters of dairy products (in milk terms) annually. This is about 10 liters more than three years ago, but still less than the European Union average, which is about 260 liters.

However, the gap separating Poland from other EU countries in terms of dairy product consumption is expected to decrease in the coming years. International market research company Euromonitor estimates that in 2015 sales of cheese, for example, will be more than 20 percent higher in Poland than last year, and sales of drinking yogurts will increase by nearly 50 percent. The value of the Polish dairy market will also increase, according to Euromonitor. In 2011, consumers in Poland spent zl.14.3 billion on dairy products, zl.600 million more than a year earlier. Four years from now, the value of the dairy market is expected to be nearly zl.17 billion.

Exports are also contributing to increased revenues in the Polish dairy industry, alongside the expanding domestic market. Since Poland entered the European Union in 2004, the value of Poland’s dairy industry exports has increased almost fourfold. Polish dairy products were mainly exported to other European Union countries, but due to increased demand in Asia, the Middle East and Africa, Poland has significantly increased its sales of powdered milk to Algeria, and the same was true of its whey exports to China, Indonesia and Malaysia.

2011 was a record year in terms of the value of dairy product exports, when they totaled 1.36 billion euros, around 15 percent more than in 2010. There is every indication that this year will also be good for Polish dairy exports. In the period between January and September this year, exports increased in the case of nearly all dairy products except butter and yogurt-and-fermented-beverages, whose sales abroad were 12 and 8 percent lower respectively than in the same period of 2011.

According to studies by the Institute of Agricultural and Food Economics, the strongest growth in exports was recorded in the case of liquid milk and cream, ripening and spread cheeses, whey and casein (24-28 percent). Powdered milk exports also increased (by 17 percent) and ice-cream exports went up by 14 percent. Total exports of dairy products in terms of raw milk equivalents increased by 6 percent to 1,299 million liters, and their value grew by 5 percent to 837 million euros.

Studies by the Institute of Agricultural and Food Economics show that the breakdown of exports by commodity has changed. First of all, the role of butter decreased in terms of value (from 11.5 to 7.1 percent), and the share of whey rose from 9.2 to 12.2 percent as a result of significant changes in transaction prices. The price of whey, a product popular among foreign importers, increased by 11 percent, and the price of butter fell by 27 percent and the profitability of exports decreased.

In the first half of 2012, cheese remained the most important item among Poland’s dairy product exports, accounting for 37.2 percent of their total value. This is not surprising because Poland is a powerhouse on the global market for cheese. More cheese is produced only in the United States, Germany, France, the Netherlands and Italy. Statistics from the Foreign Agricultural Markets Monitoring Unit (FAMMU) and the Foundation of Assistance Programs for Agriculture (FAPA) show that in the first six months of this year 83,400 metric tons of cheese products were shipped abroad, 15.7 percent more than in the same period last year. A 13-percent increase was recorded in the value of these exports, to 259.4 million euros.

The most important type of exported cheese is ripening cheese. Its exports in the first half of 2012 accounted for 54 percent of the total value (nearly 140.45 million euros) and 59 percent of the total volume (49,500 tons) of all cheeses that were exported from Poland between January and the end of June this year. This meant a 21-percent increase in value, with an 8-percent drop in volume compared with the same period of 2011.

The main recipients of Polish cheese and curd are other EU countries (70 percent in terms of value—180.9 million euros). Few changes took place in the first half of this year among the key export markets for cheese. The value of cheese sold to the Czech Republic, the main recipient of Polish cheese, continued to grow. In the first six months of 2012, 13,500 tons of cheese and curd were shipped to the Czech Republic for 41.8 million euros. A significantly higher increase was recorded in the sale of cheese to Germany, the number two market in the structure of Polish cheese exports (the volume increased by 44.8 percent to 10,600 tons, and the value went up by 40 percent to 30.6 million euros).

In another positive trend, considerable increases are still being observed in exports to countries outside the EU Single Market. These particularly include a 94.5-percent increase in the value of exports to Russia (to 28.6 million euros), which in the first half of the year was the third largest export market for Polish cheese. Exports to Ukraine doubled in terms of both value (to 7.9 million euros) and volume (up to 2,100 tons).

Imports of dairy products in the period January-September amounted to 485 million liters in raw milk equivalent terms and were 18 percent lower than in the same period a year earlier. The sharpest decline in the volume of imports was recorded in the case of yogurt and fermented beverages (by 29 percent), butter (26 percent), and powdered milk (24 percent). Imports of ice cream and casein increased strongly (by more than 40 percent). Expenditure on imports declined by 7.5 percent to 292 million euros. As a result, the positive balance of foreign trade in the dairy sector improved by 13 percent to 545 million euros, with a 30-percent increase in the quantitative surplus of exports over imports to 814 million liters in terms of raw milk equivalents.
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