Estonian Dairy Sector 2006

Tiina Saron, MBAEstonian Dairy Associationmanaging director

General information

% 1996 1998 2000 2001 2002 2003 2004 2005 2006

Share of milk production in GAO

27 28 29 31 31 28 30

Share of milk processing in food industry

26 28 28 30 27 26 32 30,3 28,2

Share of milk products in export of foodstuffs

33 32 28 25 22 20 22 19,7 17,5

Number of enterprises

28 41 44 38 38 41 42 40 38

Number of cows, milk yield, total milk production

228 224 187 162 169 159 147 131 129 112 113 109

0

200

400

600

800

1000

1200

1400

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 20060

1

2

3

4

5

6

7

no of cows

total

per cow

Number of cows in herds, %

Lehmade arv karjades, % 1994-2006

0

10

20

30

40

50

60

70

1994 1997 2000 2003 2006

1...10 lehma

11...100

101...600 lehma

600...lehma

Herd size 1994 1997 2000 2003 2006

1...10 cows 6,2 6,8 9,3 7,3 4

11...100 cows 11,5 15,7 20,5 20,4 19,2

101...600 cows 65,4 60,3 51,3 52,7 53,7

600...cows 16,9 20,8 18,8 19,6 23,2

Milk production in herds, %

Piimatoodang erinevates karjades, % kogutoodangust, 1994-2006

0

10

20

30

40

50

60

70

1994 1997 2000 2003 2006

1...10 lehma 11...100 lehma 101...600 lehma 600...lehma

1994 1997 2000 2003 2006

1...10 cows 7,4 7,2 9,9 6,4 3,2

11...100 cows 11,1 15,7 20,2 18,8 16,5

101...600 cows 61,3 56,7 49,1 52,1 54,3

600...cows 20,1 20,4 20,8 22,6 26

Milk Quota

•Total amount of quota for 2006/2007 was 646 th tons

•633 th tons of the delivery quota and13 th tons of the direct sales was allocated for 2006/2007.

•Delivery quota was fulfilled by 93,6% and direct sales quota by 57,4%

•1525 quota owners

Raw milk market, 2006

Toorpiima turujaotus 2006

Tere14%

E-Piim14%

Rakvere Piim6% Maag

2%

Saaremaa 5%

Põlva Piim Tootmine

5%

Valio23%

Teised31%

Quality of raw milk, 2006

52%38% 39%

41%58% 57%

41%

58%67% 71%

79% 83% 87% 88%

43%

32%27% 23%

17% 14% 12%

6% 3% 3,70%10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

grade I

elite or highergrade

elite grade

higher grade

Raw milk price, EEK

Raw Milk Price, EEK/kg natural weight

0

1

2

3

4

5

6

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Estonia

EU average

Latvia

Finland

Raw milk price, EEK

Raw Milk Price, EEK/kg, 1st half- year

2,75

3,873,83

4,003,83

2,00

2,50

3,00

3,50

4,00

4,50

2003 2004 2005 2006 2007

Market management

•861 tons of butter was sold to intervention in 2006

•886 tons of butter was sold out of intervention in 2006

•Marketing support was granted for 10 tons of butter and 34 tons of cream

•60,8 mln EEK was paid for export refunds

•School milk programme - 76,8% of target group is covered

Structure of the Dairy Industry

• 32 processing enterprises with 38 processing units

• 29 enterprises use raw milk

• 8 farm- dairies

• foreign investments in 6 enterprises, which own 8 processing units

Development of enterprises 1989-2006

0

50

100

150

200

250

300

1989 1992 1996 2000 2003 2004 2005 2006

Dairies Meat companies

Consumption of milk products (by milk value kg/per capita)

050100150200250300350400450500

1990 2000 2001 2002 2003 2004 2006

Consumption of drinking milk, kg/per capita

0

10

20

30

40

50

60

70

80

90

1996 1997 1999 2001 2002 2003 2004 2005 2006

Consumtion of cheese, kg/per capita

Juustu tarbimine, kg inimese kohta

0

1

2

3

4

5

6

7

1996 2000 2003 2004 2005 2006

juust

Consumption in other countries

Consumption of Milk, Cheese and Butter in Europe in 2002, kg per capita annually

020406080

100120140160180

Irela

nd

Finl

and UK

Sw

eden

Denm

ark

Neth

erla

nds

Fran

ce

Hun

gary

Aust

ria

Ger

man

y

Cze

ch R

ep

Bel

gium

Pol

and

Slov

enia

Est

onia

Gre

ece

Lith

uani

a

0

5

10

15

20

25

30cheese butter milk

milk

butter,

cheese

Trade of dairy products, mln EEK

-5000

-4000

-3000

-2000

-1000

0

1000

2000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

agricultural products milk and milk products

Export of dairy products (EU and 3rd countries), 2006

Piimatoodete väljavedu, mln EEK

0

500

1000

1500

2000

2500

3000

3500

1995 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

EL-15 EL-10 Venemaa Teised kokku

Promotional campaignes 2005, 2006,...

Life originates from milk

Estonian Milk Girl, 2004, 2005,2006,2007

Piimast algab elu

Thank you for your attention!