Poland – a land flowing with milk and honey
Honey has served people as food since the dawn of time. The first mentions of honey are as old as literature. In ancient Greece, it was considered the food of gods; the Bible refers to the land flowing with milk and honey, and one of the Southern American legends describes the world with the following words - “At the beginning, animals were people and fed only on honey.”
Ancient Egyptians generally used honey as an addition to meals and at the same time valued its healing properties. In ancient Egypt, honey used to be an element of ceremonies and often constituted a part of offerings made to gods. The oldest records of raising bees for honey come from Egypt. Ancient Greeks used honey in a similar way and it played an important role in their culture.
During the renaissance period, honey was commonly used as an addition to various types of dishes and as a sweetening agent. Unfortunately, it was later supplanted by sugar. Additionally, culinary habits changed and honey stopped being used to flavour food so often. In the contemporary times, even though we value honey for its taste and beneficial properties, it is unfortunately only a variety rather than an everyday component of our diet.
Apiarian traditions in Poland date back to the times of Slav settlements. It needs to be underlined that medieval Poland was famous for honey and wax. It was considered a land of milk and honey where beekeepers used to be generally respected and took advantage of special legal care or were even granted their own exceptional beekeeper’s rights. Death was the penalty for destroying beehives or stealing bees! Honey and wax were always present on royal and ducal tables. Mead breweries (places where mead matured) were unable to meet the increasing demand and wax candles used to illuminate temples, royal castles and courts.
Beekeeping began to be a thing of the past in Poland in the 19th century when a natural turn in bee raising took place and people started to set up apiaries next to their own households.
The turn of the 19th and the 20th century on the Polish territory was connected with the most unusual development of beekeeping movement and popularisation of apiarian education. In those times, a dozen or so apiary organisations, mostly beekeeping and gardening associations, were established. At the same time, the apiary publishing movement developed and had praiseworthy influence on the dissemination of apiarian education.
Bee honey
There are approximately 41,000 active beekeepers in Poland at the moment; the number of bee families is estimated to total about 1 million. Honey production in Poland reached almost 18,000 tons in 2008. Undoubtedly the systematically growing number of youngest beekeepers (below 35, about 10.7% of all beekeepers in Poland) and the increasingly higher quality of bee products are some of the most beneficial changes in the beekeeping industry that have taken place during the last three years.
The results of quality controls of honey, performed by the Agricultural and Food Quality Inspection (IJHARS) in the period from 2004 to 2007, show that the honey offered on the Polish market is of very high quality.
The control results explicitly indicated quality improvement of honey supplied directly by manufacturers. As compared to previous years, the number of batches not in agreement with the order of the Minister of Agriculture and Rural Development concerning detailed requirements in terms of commercial quality of honey fell down noticeably.
Polish beekeepers take extreme care of the quality of their products. Polish honey is very popular with the consumers from Western Europe. It is not filtrated or processed physically, thereby contains microelements and pollens, and is characterised by an exceptional aroma. Polish products are many a time safer than the ones produced in the west.
“Due to high fragmentation of Polish agriculture, apiaries located in Polish villages and forests are in a much more privileged situation than the ones in Western Europe due to weaker industrialisation of agricultural production technology. In the west, strong contamination of the natural environment, mostly with insecticides which destroy entire apiaries and negatively affect the whole population of bees as well as the health of industrial food consumers, has been observed” - says Waldemar Badeñski from PPHU Nektar
“As the owner of S±decki Bartnik Company, I have been an enthusiast of beekeeping and lover of bees for many years. Our company makes every effort to provide a customer with an opportunity to try out the results of strenuous and hard work of bees, and not only a product that is only packed nicely and called honey” - says Janusz Kasztelewicz – “Besides the fact that we have our own apiary with more than 1500 bee families, we also purchase honey, which has to successfully undergo a series of tests before can be launched to the market, from other parts of Poland. We also operate based on the ISO and HACCP Quality Management Systems and according to the BRC and IFS food safety standards” - he adds.
In recent years, honey production in Poland has gone up. Several factors have had influence on this situation. Relatively good conditions and increasing honey productivity of a hive are the two most important of them. It is not without significance that the structural changes imposed by various support mechanisms (the Rural Development Plan or the National Program for Support of Apiary) have positively affected the condition of the Polish beekeeping industry.
“Apiary in Poland meets the strict requirements of the veterinary inspection; however, the market and large commercial networks are mainly interested in inexpensive honey, whose quality is very often nowhere near the quality of proven Polish honey” - says Waldemar Badeñski from PPHU Nektar - “Honey sold under the Polish norm is characterised by much better parameters than the honey imported from abroad. Due to high costs of production, Polish apiarian products are mostly purchased by those customers who are aware of their benefits and resign from industrial food. Because of production fragmentation, the potential of the industry is still fairly big and the number of small apiaries, which do not use the industrial methods of moneymaking (popular in the USA, China and other countries), is getting bigger” - he adds.
It is worth underlining that recent years have been exceptionally tough for the global apiarian industry. An epidemic of infectious diseases attacking bees as well as various parasitic diseases, like varroatosis, have caused serious losses in apiaries. “The CCD syndrome (colony collapse disorder), which consists in mysterious extinction of bee families at beehives, has been the worst problem of the last five years” - informs Janusz Kasztelewicz.
Many different varieties of honey are available in Poland and there are many methods of collecting honey.
“In general, honey is divided into two main categories - nectar honey and honeydew honey” - explains Janusz Kasztelewicz from S±decki Bartnik.
Nectar honey is made from nectar of various flowers. It can be divided into multiflorous, linden, buckwheat, acacia, rape oil, dandelion or heather varieties. Such rare varieties as raspberry honey or goldenrod honey are available on the Polish market too. Honeydew honey is a specific type of honey because its production is possible thanks to a certain species of aphis feeding on coniferous trees. In Poland, honeydew honey is considered the best and is often called royal honey. Multiflorous honey is definitely the most popular variety in terms of market share.
Poland is one of the leading producers of honey in Europe. Nevertheless, honey consumption is significantly smaller than in the rest of the European Union. Annual honey production in Poland amounts to approximately 18,000 tons. Meanwhile, consumption per capital totals only just 45 decagrams per year. Honey as a therapeutic and nutritious product is underestimated in Poland, which is indicated in the low honey consumption as compared with the Western Europe.
Building proper awareness of Poles is necessary to increase the consumption and interest in honey. Hence, the Polish Beekeeping Union has decided to launch a campaign called “¯ycie miodem s³odzone” (Life sweetened with honey) financed in 50% by the European Union. Its main objective is to popularise honey consumption among Polish citizens and overcome the seasonalness of consumption. Currently, honey is consumed mainly in the autumn/winter season. The undertaken actions are aimed at stressing the gustatory and nutritional values of natural honey and strengthening consumers’ knowledge on the beneficial properties of bee products. The campaign is carried out in the scope of “Support of promotional and informational actions on the markets of selected agricultural products of the European Union.”
“Honey is still a product purchased very rarely in Poland and its consumption is low. Annually, Poles consume on average 400g of honey per capita; while in Germany, this figure amounts to 1400g” - admits Janusz Kasztelewicz.
Polish citizens’ awareness of the benefits connected with the consumption of honey and bee products is limited to the tradition of eating honey only when we fall ill.
Export of Polish honey
The European Union, as a region, is the biggest importer of honey in the world (approximately 500,000 tons of honey a year). For many years, Poland has recorded a surplus of honey import over export. Insignificant discrepancies in these proportions depend on the quantity of honey produced in a given year. In 2006, a record high amount of honey (22,000 tons) was produced in Poland, which is why proportionally smaller quantities of this product were imported from abroad in 2007.
About 184 tons of honey were exported from Poland in 2005 – nearly 78% (642 tons) less than in 2004. During the 11 months of 2006, 350 tons of honey were sent abroad, which in relation to the corresponding period of 2005, meant an increase of exports by 50%. The highest value of honey exportation was recorded in 2004 and amounted to 2.5 million EUR. In 2005, this figure totalled 0.66 million EUR, and 0.92 million EUR for the period from January to November 2006.
Based on the data provided by the Agriculture Department at the Ministry of Finances, in the period from January to September 2008, the export of honey to the EU and third countries reached 1.2 million EUR in value terms and 323 tons in volume terms.
“The export of honey is an important element for our company” - admits Janusz Kasztelewicz from S±decki Bartnik - “Unfortunately, it is not as developed as we would like it to be. I cannot say that we export large amounts of honey because we are able to export much more. Unfortunately, it is very difficult to promote a Polish brand of honey on European and global markets. In recent years, the relation between exports and the entire production at our company has oscillated around 20%. At present, we sell our products mainly to Germany, Great Britain, Canada, the USA and France. We export confectionary honey in jars there. We also send raw material in barrels or containers to the west.”
Nektar also exports honey varieties to the USA, Canada and Great Britain, and intends to continue doing so despite the unfavourable situation on the currency market in 2008.
Which Polish products are most popular with foreign customers?
“Every country has its own peculiar culture, habits and preferences” - says Mr Kasztelewicz - “Light-coloured honey, in particular the multiflorous, acacia or linden varieties, sells best in Great Britain. We sell very dark honeydew honey mostly to Germany and Austria, where our coniferous fir honeydew honey is particularly valued.”
According to Waldemar Badeñski from Nektar, consumers decide to buy multiflorous, linden and honeydew honey varieties most often.
Mead – Polish
Czwórniak, Trójniak, Dwójniak and Pó³torak
Mead is a natural product produced without the use of stabilisers, preservatives, artificial dyes or aromas. Many years ago, mead was one of the most important alcoholic beverages for our ancestors. Mead production in Poland is distinguished by a long-standing tradition and very wide diversity. As a result of the development and improvement of the production method throughout the ages, many varieties of mead were created. The first mentions of mead date back to 966.
Mead was probably the first alcoholic beverage people ever produced. Mead is said to have been the ambrosia drunk by gods at the Olympus. The reports written by Gaius Plinius mention that the Greek and Romans used to produce mead, and the most famous cookbook of the Roman Empire, compiled by Apicius, included a recipe for mead.
The quality and properties of mead are influenced by the selection and quality of honey, which is available in countless varieties. Other factors affecting the quality of this product include water quality, time of honey barrel brewing as well as the amount and moment of adding spices, hops or fruit juice.
The specific nature of old Polish mead is a result of using and strictly observing the fixed proportion of water and honey in a honey barrel. Pó³torak, the noblest mead of all, contains one volume of honey and 0.5 volume of water in the finished product. Based on the old Polish traditional recipe, the product’s character requires a precise period of mellowing and maturing to be observed. In the case of the old Polish Pó³torak, it means at least 18 months.
According to El¿bieta Paw³owska, Head of the National Winery and Mead Making Council’s Office
(Krajowa Rada Winiarstwa i Miodosytnictwa), the Polish market of mead is relatively small. There are only a few producers. “In our opinion this market has a big potential for development, which is confirmed by an increased number of producers” – she says.
Apis from Lublin is currently the leader on the market of these alcoholic beverages in Poland. The company produces approximately 500,000 litres of mead a year and its market share totals about 85 percent. It is the owner of such brands as Kurpiowski, Lubelski, Staropolski, Piastowski, Grzaniec Polski, Bernardyñski and Korzenny.
The sale of liquor based on mead generates half of the company’s receipts. The remaining part of the revenues is generated by natural honey in various forms; since last year, the company has also offered mead with the Q10 coenzyme, which slows down the process of cell ageing.
Most of the company’s production volume is sold outside the company and large commercial chains start to play an important role in the distribution of products. Export is very important for the company, yet the majority of mead products produced in Lublin are sold on the domestic market. The company has exported its Pó³torak, Dwójniak, Trójniak and Czwórniak mead varieties to the United States, Canada, Australia and Germany, and recently also to Sweden and Italy.
The company hopes to double the export of produced mead in the next three years. It already sells about 100,000 litres of mead abroad and exportation is rising faster than the sale on the domestic market (by 25% annually).
The second largest producer of mead is PASIEKA Jaros Maciej, which has produced mostly mead products since 1991. The company’s production technology is based on the old Polish tradition and recipes. PASIEKA produces about 130,000 litres of mostly the Trójniak and Dwójniak mead varieties annually.
Mead provides Polish producers with an opportunity to become known on the global market of alcoholic beverages. For three years now, Polish producers have tried to protect Polish traditional mead varieties at proper bodies of the European Union in order to ensure their original trademarks and recipes. In 2008, four Polish products were entered on the EU’s Traditional Specialty Guaranteed list. The European Commission has registered the Old Polish Czwórniak, Trójniak, Dwójniak and Pó³torak mead varieties. Therefore, the promotion of these products as traditional goods will be strengthened, which will allow producers to demand higher prices.
Foreign customers are fond of all mead varieties; however, every country has its own preferences. Mead is exported, amongst others, to Germany, Sweden, the USA, Canada and Australia.
Approximately 650,000 - 700,000 litres of this golden beverage are produced in Poland every year, of which about 100,000 litres are assigned for exportation. The sale abroad has been growing faster than domestically – at a rate of more than 25% per year.
“At present, exportation constitutes approximately 20% of the entire sale of mead. We hope that the export sales will continue to rise and the producers will have the chance to enter new markets” - says El¿bieta Paw³owska from the National Winery and Mead Making Council. She also adds, that another opportunity for Polish mead makers may be the successfully completed procedure of registering mead at the European Commission (under the Traditional Specialty Guaranteed list).
According to Ms Paw³owska, Polish products do not differ from the ones produced in the west in terms of safety. Mead producers pay special attention to the quality of their products. Most of the companies have already implemented the ISO 22000:2006 quality management and HACCP systems. The quality of Polish mead products is confirmed every year by various awards and distinctions granted during fairs and exhibitions both in Poland and abroad as well as in consumer contests.
Dairy products
Calcium is called the element of life. In the case of calcium deficiency in the organism, we feel weak and tired; children may suffer from spinal defects and have weak bones, whereas women tend to fall ill with osteoporosis earlier. Experts recommend consuming 800-1200 mg calcium every day depending on the sex, age and lifestyle. It is an equivalent of four slices of cheese, three glasses of milk or two glasses of yoghurt, kefir, buttermilk and one kilogram of cottage cheese. Hard cheese, cottage cheese, yoghurt, kefir, buttermilk, cream cheese, butter, cream and of course milk all belong to the category of dairy products.
Dairy produce consumption in Poland is one of the lowest in Europe. An average Pole consumes approximately 190 litres of milk a year, which does not look good if we compare it with the remaining European states where the average consumption of milk amounts to 370 litres (more than 400 litres in Germany and France, and above 500 litres in the Scandinavian countries).
“A customer who purchases dairy products is increasingly educated as far as a healthy and properly balanced diet is concerned. Therefore, such dairy products as milk desserts or yoghurt are becoming a planned purchase” - says Marta Chowañczak, Product Manager at Bacha.
“A modern consumer is a man of action – extremely hard-working, busy and at the same aware of what proper nutrition is about. He or she consumes most of all high-quality ready products – healthy and delicious as well as nicely and conveniently packed” - says Dariusz Sapiñski, President of Management Board at Mlekovita Capital Group.
Despite low consumption per capita, dairy products sell well. Yoghurt, cottage cheese, hard cheese, milk and cream were shortlisted among the 20 best-selling products in the last research period. According to the data gathered by AC Nielsen, in the period from December 2007 to November 2008, the sale of yoghurt increased by 14% in terms of value and 7,2% in terms of volume as compared to the corresponding period of the previous year. The sale of curd cheese products (natural, cottage, cream, mozzarella and feta cheese) grew by 16,7 % and 5.4% respectively in the same period. The net gross profit from the sale of cheese rose by 8,8% but the volume of sold kilograms decreased by 3,2%. Milk recorded a value increase of sales by 12,3% with an insignificant volume drop by 1,5%.
“The market is becoming visibly polarised – we have the economic segment on one side and the premium one on the other side” - says Jacek Wyrzykiewicz, PR & Trade Marketing Manager with Hochland Poland - “The so-called central segment tends to disappear. It is connected with the increasing income of Polish consumers and their stratification. There are more and more customers who pay attention to the quality and taste of a product as well as brand’s image, and are ready to pay extra for them”.
He adds that the demand for cheese manufactured by Hochland is particularly high in the case of ripening cheese in slices, cottage cheese and processed cheese, which have recorded a volume growth as compared to the previous year. “We would be pleased with a quicker growth of the blue cheese market, but it is probably just a matter of time. Traditionally, our best-selling and flagship product is the Hochland cheese spread, followed by the Almette and Valbon cheese types, which have their own loyal consumers” - says Jacek Wyrzykiewicz.
The Focus Research Polska Institute, which monitors promotions advertised in the brochures of large commercial chains, demonstrated that the biggest number of promotions in the researched period from January to October 2008 concerned hard cheese (18.5%), margarine (8.6%), butter, blue cheese and fruit yoghurt (above 6% each).
There are a few very large producers and many local dairies operating on the Polish market of dairy products. International companies are present as well. In the case of milk products, manufactures decide to create production lines in almost all possible categories at the same time. Leading home-based companies are Mlekovita Group, Mlekpol Group and Bakoma. Their biggest competitors come from the West and include Danone, Unilever, Hochland, Zott, Arla Foods, Raisio, Lactalis and Bongrain, which intensely promote their brands on the Polish market.
According to Focus Research Polska, amongst all the dairy produce categories, most of the promotions were connected with the products offered by Danone (8.5%), SM Mlekpol (4.9%), Unilever Poland (4.2%), Hochland Poland (4.2%) and Bongrain Poland (3.9%).
Milk
Based on the data provided by AC Nielsen, in the period from December 2007 to November 2008, the UHT milk generated sales of the total value of 300 million Euros, which constituted an increase of more than 12% as compared to the corresponding period of the previous year. 4.82 million hectolitres of this white liquid were sold. It is also worth mentioning that the volume of UHT milk sale decreased by 7.55 million litres in relation to the same period the year before. The milk containing 3.2% fat was the most popular product within this category – it constituted 47.6% of the total sale. It was followed by products containing 2% and 1.5% fat. The first one had a 21% volume share and 23.2% value share in the market, whereas the latter one - 17.2% and 15.5% respectively. We are definitely not fond of flavoured milk - the sales value amounted to merely 4.5% of the total sale. As far as the type of packaging is concerned, 99.6% of milk is sold in cartons. The product sold in plastic bottles constituted only 0.4%. Thereby, the natural UHT milk had the 98.4% volume share and 95.5% value share in the market.
Mlekpol from Grajewo is the leader on the Polish market of UHT milk. Based on the MEMRB data, it had a 42% share in the milk market in terms of volume and a 46% share in terms of value. Mlekpol’s milk was followed by producers’ private labels. OSM £owicz was in the third place with a 12% share in the market (in terms of both volume and value).
Cheese
About 90 kinds of cheese are manufactured in Poland. The market is mainly divided into hard cheese, curd cheese, processed cheese and blue cheese.
Hard cheese
The AC Nielsen’s report demonstrated that from December 2007 to November 2008 - 73,123 tons of hard cheese were sold for a total amount of 347,5 million EUR. A profit from the sale grew by 8.8%, whereas 3.2% less hard cheese was purchased in terms of volume. The Gouda-type cheese had the highest value and volume shares in the market of hard cheese – 28.2% and 30.5% respectively. This type of cheese was followed by the Edam cheese, salami cheese and Podlaski cheese.
The sale of hard cheese at supermarkets constituted 42% of the total value with a 2.1% increase, whereas the sale at hypermarkets remained the same and amounted to 29.3% of the total sales value. It is clear that the modern channel of distribution plays an important role. SM Mlekpol, Mlekovita Group, Hochland, Spomlek, Bongrain Poland, Lactalis Poland, Polmlek and Arla Foods offer a wide selection of cheese products. Amongst the hard cheese producers who promoted their products in the brochures of commercial chains from January to October 2008, SM Spomlek (8.2%), SM Mlekpol (7.7%) and Polmlek (7.4%) were the leaders.
“The Polish market of hard cheese is very dynamic. It offers a wide range of products: Dutch-type and Swiss-type cheese as well as the so-called exclusive cheese” - says Dariusz Sapiñski - “The increasing nutritional awareness of the consumers causes that cheese consumption in Poland is on a rise. MLEKOVITA offers hard cheese in the three aforementioned varieties. They are offered in different packaging (depending on the basis weight) and have been extremely popular with consumers. They are not only tasty but also highly nutritious.”
The current range of products of the company consists of approximately 300 dairy products, including amongst others Dutch- and Swiss-type ripening hard cheese, smoked and processed cheese, salad and spread cheese, cottage cheese, Mozzarella cheese, UHT milk of diverse capacity and content of fat, pasteurised milk, UHT cream, concentrated milk, flavoured milk, kefir, yoghurt, buttermilk, curd cheese and flavoured cheese curds, cream and homogenised cream, butter and buttery mix, powdered milk and powdered whey.
“Ripening cheese is the second, after curd cheese, biggest segment of the Polish market. For several years now, this market has been growing and is highly fragmented - ripening cheese products are offered by both smaller and larger producers, whereas the full range includes several hundred products” - says Jacek Wyrzykiewicz from Hochland - “We are still observing a rather low level of cheese consumption as compared to the developed countries, but there has been a noticeable growth tendency in recent years. More and more consumers decide to purchase cheese, which results in the increase of sales volume in a natural way. New producers and products appear on the market, which obviously makes the competition fiercer. Amongst all of the available ripening cheese products, consumers still prefer the ones sold by the weight. However, this tendency is changing in favour of cheese in slices packed by a producer” - he adds.
Curd cheese
The previously quoted report prepared by AC Nielsen showed that the sale of curd cheese rose by 16.7% last year and amounted to 405 million EUR. Almost 129,000 tons of curd cheese were sold; natural curd cheese had the biggest share in the market (32.1%) in terms of sales value, while the products packed individually were most popular (62.9%). Cream cheese constituted 36.2% of the total sale, whereas cottage cheese had a share of 21.5%. The least popular curd cheese types were Feta, Mozzarella, ewes’ milk cheese Bryndza or smoked ewe’s milk cheese Oscypek.
“Cottage cheese has its own traditional image yet it is not the weakest player on the market. It is considered a natural product characterised by high nutritious values, thanks to which these products are not eliminated and, in spite of increasingly fiercer competition, do very well on the dairy produce market” - says Joanna Wojciechowska, Commercial Director at OSM WART-MILK in Sieradz - “Cottage cheese consumption is growing all the time. Confectionary cottage cheese sells best and experts predict that it will push curd cheese sold by the weight out of the market. The consistency of cottage cheese, the use of flavour additives and various modifications of product packaging will have substantial influence on the decisions to purchase a given product” - she adds.
Processed cheese
According to AC Nielsen, from December 2007 to November 2008, Poles spent 157 million EUR on processed cheese, i.e. 15.5% more than in the corresponding period of the previous year. The sales volume totalled 33,300 tons and rose by 2.1% as compared with the same period the year before. Products sold in blocks, which had a 36.5% value share and a 40.6% volume share in the market, were the best-selling processed cheese types. Cheese in slices was the second most popular product with respectively 32.5% and 30.5% shares in the market. It was followed by portioned cheese, which had an 18.2% value share and a 15.8% volume share in the market. Polish customers most often bought processed cheese at supermarkets (almost 34% of value share in the market). The said products were also purchased at small and medium-sized groceries, which altogether had a 41% share in the market.
Blue cheese
These types of cheese products were increasingly popular among Polish gourmets and cooks – their sale grew by 16.4% in terms of value and 6.8% in terms of volume. In the analysed period, 7,467 tons were sold for a total sum of 57,5 million EUR.
Yoghurt
According to AC Nielsen, the Polish market of yoghurt is worth 455 million EUR (260,611 tons of sold products). In comparison with the period from December 2006 to November 2007, a sales increase by 14% in terms of value and 7.2% in terms of volume was recorded. Fruit yoghurts were most popular – they had more than 76% volume share in the market. Natural yoghurt had 17% share in the market, whereas for non-fruit products this figure totalled 6.8%. The most popular containers were the ones from 101 to 249 grams – they were selected by 44.9% of customers. 23.8% of the profit was generated by 301-400 gram containers, whereas larger containers (401-500 grams) had a 12.5% share in the market. Undoubtedly, Danone and Zott were the main suppliers of yoghurt to the Polish market. Bakoma, Bacha, Mlekpol, Mlekovita Group, SM Spomlek, Polmlek Group were the most important Polish producers of yoghurt.
Kefir
The market of kefir, according to the AC Nielsen’s report, recorded a sales increase from 45,25 million EUR in 2006/2007 to 50,31 million EUR in 2007/2008. The volume sales went up slightly and amounted to 52,447 tons. Natural kefir (92.6%) in a plastic container (69.1%) was the unquestionable market leader. Kefir in plastic bottles had a 26.2% share in the market.
Butter
Butter is the biggest segment in the yellow fat category in terms of sales value. The sale of butter exceeds the sale of margarine and butter mixes put together. However, this segment is extremely fragmented. At the same time, 213 different types of butter are sold at hypermarkets alone. In Poland, nearly 250 dairies specialise in the production of butter.
According to the AC Nielsen’s data covering the period from October 2007 to September 2008, the yellow fat market (including butter, margarine and mixes) was worth 625 million EUR (280,000 tons). 47.4% of the total sale was generated by butter, mainly in containers of up to 245 g (75.4%). Margarines and mixes took 52.6% of the market; large containers of more than 400 g (59.4%) were most popular in this category.
“Butter consumption in Poland, despite being fairly high, will probably still grow taking into account the difference in relation to Western European countries. It is mostly caused by the fact that butter is more often used in hot kitchen applications, including baking; therefore, the market share of margarine in packets is shrinking” - says Monika Go³êbiewska, Marketing Communication Specialist at Raisio Poland. She adds that supplies to confectionary companies and ice-cream manufacturers are a significant part of the entire butter market. Additionally, butter production is supported by European Union surcharges within the common agricultural policy.
*/We assumed the exchange rate 1 € = 4 PLN/.
Export of Polish dairy products
After Poland’s accession to the European Community, export of Polish dairy products abroad increased a lot. After Poland joined the European Union, the Polish dairy exports rose by 70% in 2004 and by 50% in 2005 amounting to more than 900 million EUR – other branches and industries can only dream of similar export figures. After the 2006 stabilization when the value of exports grew by 4% only, 2007 witnessed a noticeable improvement of the Polish foreign trade in dairy products. The positive and favourable situation on global dairy markets was the reason for another prosperity period for the Polish dairy industry. Exportation from Poland rose by 27% in terms of goods value. 687,000 tons of dairy products (3% less than in the previous year) were sent from Poland abroad. The value of exports for the first time ever exceeded 1.16 billion EUR, whereas the receipts from export in dollars were 38% higher than the year before and amounted to 1.58 billion USD. It was possible due to very high prices on international markets.
According to the Agriculture Department at the Ministry of Finance, the export of milk and cream (not concentrated) was worth 118,089 million EUR and totalled almost 181,000 tons in the period from January to September 2008. In the same period, we exported 98,000 tons of concentrated milk and cream for a total amount of 221,38 million EUR. The exportation of buttermilk, sour milk and cream as well as yoghurt totalled 88,088 million EUR (75,000 tons). We exported almost 104,000 tons of hard cheese and curd cheese to the European Union markets and third countries for a total amount of 361 million EUR.
According to the Foundation of Assistance Programmes for Agriculture (FAPA), the total value of dairy products exportation from January to September 2008 amounted to 949 million EUR. The total exports volume was 611,000 tons and exceeded the volume recorded in the corresponding period of the previous year in almost all product groups (besides the yoghurt and butter segments). After the first three quarters of 2008, the value of exports was slightly higher (by 6%) than the level recorded in the corresponding period of 2007.
The growth rate of dairy exports oscillated around 6% in the period from January to September 2008. After the first three quarters of 2008, the share of dairy exports in the total exportation of foodstuff slightly decreased (from more than 12% to over 11%).
According to FAPA, dairy exports were directed mostly to the European Union member states - more than 81% of the total value of dairy produce export (as compared to 77% in the previous year). The largest markets for Polish dairy products included Germany (26%), the Czech Republic (7.9%), Italy (7.8%), the Netherlands (7.4%), Hungary (5.8%), Algeria (3.8%), Slovakia (3.5%), France (3.4%) and Spain (3.0%). However, the export of dairy products to the Netherlands and France, and especially to Algeria (by 1/3) decreased in comparison with the corresponding period of 2007.
FAPA indicates that we owe the positive result of Polish dairy produce export after 9 months of 2008 to good sales of cheese. In total, 115,500 tons of cheese were exported, i.e. 12% more than in the previous year, and due to higher prices, the exports value increased by nearly 1/3 and reached 360 million EUR. Ripening cheese was the most important type of exported cheese. It constituted 54% of the value (almost 195 million EUR) and half of the volume (i.e. 57,700 tons) of all the cheese types that were exported abroad in the said period. Edam cheese was the most popular type of exported hard cheese. The exportation of processed cheese, mostly cheese spread, developed less dynamically. Its volume grew only by 3% and amounted to 24,000 tons, however its value increased by 28% to almost 82 million EUR, which constituted 23% of the total value of exported cheese. Curd cheese was the third significant exportation category. The sales value reached 78.7 million EUR (a 22% share in the total export of cheese). EU member states, particularly Poland’s neighbours, were the most significant importers of cheese and curd cheese from Poland. The export to Germany rose exceptionally dynamically (by 40% to 66.3 million EUR, i.e. a share of more than 18%). The Czech Republic also imported many Polish dairy products (an increase of 16% to 52.1 million EUR; i.e. a share of more than 14%). Italy, Hungary and Slovakia were other important recipients of Polish cheese.
Low-fat powdered milk was still one of the flagship Polish dairy products - its export rose by 8% in terms of volume, but the value decreased by 21%. The export of unskimmed powdered milk recorded an increase in terms of both volume (+82%) and value (by 2/3).
Powdered milk was exported most of all to the European Union markets. The sales volume to Germany almost doubled (to 32,600 tons), but its value increased by only 10% and reached 69.3 million EUR.
Liquid milk, in particular cream, is an important component of Polish dairy exports. The sales volume of these products rose by nearly 1/3 to more than 180,000 tons, while the value increased by 8% and totalled 118 million EUR. Germany was the dominating market where these products were exported.
According to the data provided by FAPA, the export of yoghurt, kefir, milk drinks etc. was characterised by a tendency different from the one visible on the powdered milk market. The exports volume went down (slightly by 1.5%), whereas the value rose considerably by 17% to 88 million EUR. Therefore, the share of the said goods in the total value of Polish dairy exports exceeded 9%. The products from this category were mostly exported to Italy, where 8,100 tons of yoghurt and milk desserts were sold (+11%) for 20.8 million EUR, which resulted in a 24% share in the total exports value for this category.
Butter, sent mostly to the European Union member states, was not of particular importance for the entire export of diary products. 24,600 tons of butter were sold abroad from January to September 2008, i.e. 9% less than in the previous year. The exports value amounted to 65 million EUR.
Polish dairies are becoming increasingly present on the developing Asian markets such as for example China. The Polish dairy industry hopes that exports to Arab countries, where Polish powdered milk, cheese or sour milk have been offered for some time, will be very beneficial and advantageous in the near future.
Export is an exceptional opportunity for the dairy industry in Poland. Dairy products are exported by thirty dairies out of more than 200 companies operating in this industry. They are among others: MLEKOVITA Group, Mlekpol Group, Spomlek, SML Ostro³êka, SM £owicz, OSM Radomsko, MSM Ostrowia or OSM Krasnystaw.
According to Dariusz Sapiñski, MLEKOVITA is the unquestionable export leader among all Polish dairies. MLEKOVITA’s products are exported to all global markets, including the most demanding ones: the European Union, the USA and Japan. MLEKOVITA has been at the top of the Ranking of 10 Biggest Exporters of dairy products, prepared by the Agricultural Market Agency, for years and is the only diary company on the Polish market which has been given the Polish Outstanding Exporter title and the POLISH EXPORT LEADER special award in the Polish Outstanding Exporter competition organised by the editorial staff of the Rynki Zagraniczne weekly.
MLEKOVITA Group is fully owned by Polish capital. At present, it is the most modern dairy in the country with long-standing traditions and well established brand not only in Poland but also abroad. Production is conducted according to the requirements of the ISO 9001 and ISO 14001 certified integrated quality management systems and based on the standards of the ISO 22000 HACCP system.
SM MLEKPOL assigns a significant part of its production for export to many countries around the world. The products are delivered to the European Union, Africa and the Far East. Approximately one third of SM MLEKPOL’s production is exported mainly to Italy, France, Germany, the Netherlands, Belgium, Spain, the Czech Republic and Great Britain. The export offer includes hard cheese, low-fat powdered milk, butter and powdered sour milk, which can be found on store shelves in the Netherlands, France, Italy, Germany, the USA, Canada, Russia, Brazil, Algeria, Venezuela, Mexico, Vietnam or Pakistan. Foreign customers highly value the powdered milk from Grajewo, which constitutes up to 64% of the company’s total export. The remaining export offer includes mostly cheese, butter, curd cheese, concentrated and flavoured milk, UHT milk and cream, low-fat powdered milk and sour milk. Since 1999, MLEKPOL’s goods have met all our customers’ needs and legal requirements at every stage of a production process. Fulfilling these requirements is guaranteed by the Quality Management System based on the ISO 9001 Norm.
Summary
Producers are trying to seize any opportunity that comes along to promote their dairy products. Danone has won the trust of Polish consumers thanks to the “Partnerstwo dla Zdrowia” (Health Partnership) project. This initiative is aimed at promotion of healthy nutrition, especially among children. Danone, in cooperation with Maspex, Biedronka and the Institute of Mother and Child, has created a product that constitutes a full-of-value breakfast for schoolchildren – an instant milk porridge named “Mleczny Start” (Milky Start).
The “Stawiam na mleko” (I decide on milk) campaign, launched last year, turned out to be a huge success. 83.5% of mothers declare they will give milk products to their children more often, 82.7% will give their children more milk and 74.1% will consume more milk products on their own. 73.1% of mothers indicate they will drink more milk.
Polish dairies make an effort to promote their products abroad as well, amongst others during international trade fairs and exhibitions or in the form of various promotional campaigns focused on foreign customers.
The level of knowledge in the field of product’s health safety is constantly increased. Customers also want to have as updated information on the current legal requirements as possible. Companies carry out detailed controls at the stages of supply purchase, production as well as storing and distributing products. Suppliers are proven partners who guarantee high quality and safety of delivered materials. Polish producers are fully aware of the fact that ensuring safety of products has extreme influence on the health of consumers. Therefore, companies invest in HACCP systems and posses certificates of conformity with the requirements of the ISO 2200 and ISO 9100 norms. More companies want to receive the IFS or BRC certificates, without which winning customers abroad is very difficult or virtually impossible.
It is worth mentioning that the Polish dairy industry has designed and implemented the “Guide of Good Hygiene and Processing Practice in Dairy Sector.” It is important in so far as the Regulation (EC) No 852/2004 of the European Parliament and of the Council of 29 April 2004 obligates the member states to compile such guides by the diary sector organisations.
Tomasz Masal