Spain is holding the rotating EU presidency in the first half of 2010 and Agricultural Minister Elena Espinosa is using the period to raise calls for higher levels of EU support to its farmers as the reform of the costly Common Agricultural Policy (CAP) continues through the outlook period.
Spanish farmers are currently struggling across the board, but perhaps no agricultural sector is suffering more than sugar. Sugar consumption should remain stable given the fact that Spain is a developed country and that sugar is an established item within it. However, consumption will likely be curtailed slightly given rising health-consciousness. To 2014, BMI expects consumption to rise by a meagre 0.6%. This level of growth remains nothing more than a dream for domestic sugar producers, who have been hit with decreased EU support and are now under pressure from African, Caribbean and Pacific (ACP) sugar producers, who are now being given preferential access to EU markets. Latin American sugar producers are being afforded the same treatment. While Spanish firms took notice and began a process of sector consolidation to try to maximise efficiency, we still predict a pronounced production decrease of 50% from now until 2013/14.
Domestic dairy producers are feeling the same crunch. While the Spanish government tried to align milk prices with indexed retail demand. However, this will unlikely mitigate farmer concerns with falling milk prices (which dropped 13% between January 1 and mid-March) and CAP quota reforms that will no longer provide such lucrative subsidies based on production levels. Based on this, we predict a slight decrease in production output, which is expected to fall 6.96% to 6.8mn tonnes. Despite this contraction, given that milk consumption is forecast to decrease 5.8% to 3.6mn tonnes, which will leave a large surplus within the country. Eventually, a greater chunk of this surplus production may be directed towards cheese, where output levels are currently well-below consumption levels (which are expected to grow by 15% to 2014, by far the biggest increase for any domestic dairy product).
Two sectors that should see growth over our forecast period are in livestock and grains. We predict a massive jump in barley production from now until 2013/14 of 90.02%, as a greater percentage of domestic acreage is planted with the crop. Similarly corn production, which contracted by 21.08% between 2005 and 2009, will improve markedly, mainly because of its potential to develop sustainable fuels at a time when such considerations are increasingly pertinent globally. We forecast output to increase by 30.28% to a reasonable 4.97mn tonnes by the end of our outlook. Finally, regarding livestock, we believe the pork sector possesses the greatest expansion potential and this will stay the case over the next five years, given its place in the national diet and reputation for high quality. We predict output to increase by 6.99% to almost 3.48mn tonnes by 2013/14, higher than forecasted growth for both beef (2.25%) and poultry (1.45%).
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Partial Table of Contents:
Executive Summary
SWOT Analysis
- Spain Agriculture SWOT
- Spain Political SWOT
- Spain Economic SWOT
Industry Business Environment Overview
- Introduction
- Global Agribusiness Business Environment Ratings
Supply Demand Analysis
- Spain Dairy Outlook
- Spain Milk Production & Consumption
- Spain Butter Production, Consumption & Trade
- Spain Cheese Production, Consumption & Trade
- Spain Milk Production & Consumption
- Spain Butter Production, Consumption & Trade
- Spain Cheese Production, Consumption & Trade
- Spain Sugar Outlook
- Spain Sugar Production, Consumption & Trade
- Spain Sugar Production, Consumption & Trade
- Spain Grains Outlook
- Spain Wheat Production, Consumption & Trade
- Spain Corn Production, Consumption & Trade
- Spain Barley Production, Consumption & Trade
- Spain Wheat Production, Consumption & Trade
- Spain Corn Production, Consumption & Trade
- Spain Barley Production, Consumption & Trade
- Spain Livestock Outlook
- Spain Poultry Production, Consumption & Trade
- Spain Pork Production, Consumption & Trade
- Spain Beef & Veal Production, Consumption & Trade
- Spain Poultry Production, Consumption & Trade
- Spain Pork Production, Consumption & Trade
- Spain Beef & Veal Production, Consumption & Trade
Competitive Landscape
- Agricultural Commodity Producers & Traders
- Agribusiness Suppliers
- Integrated Agricultural Producers
Commodity Price Analysis
- Monthly Softs Update
- Cocoa
- Coffee
- Milk
- Sugar
- Monthly Grains Update
- Corn
- Rice
- Soybean
- Wheat
Downstream Supply Chain Analysis
- Industry Forecast Scenario - Food
- Table: Spain Food Consumption Indicators -- Historical Data & Forecasts
- Table: Canned Food Value/Volume Sales -- Historical Data & Forecasts
- Table: Confectionery Value/Volume Sales - Historical Data & Forecasts
- Industry Forecast Scenario - Mass Grocery Retail
- Table: Mass Grocery Retail Sales by Format (US$bn) -- Historical Data & Forecasts
- Table: Grocery Retail Sales By Format, 2008 and 2018 (%)
Macroeconomic Forecast
- Table: Spain - GDP By Expenditure, 2007-2015
BMI Forecast Modelling
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