Mrs Dr. Katalin Szántó TörökManaging director

Belgrade, 19 October, 2010

THE ROLES AND POSITIONS OF THE WHOLESALE MARKETS IN

HUNGARY

1. SIMILAR PROBLEMS2. POSITIONS OF WHOLESALE MARKETS IN HUNGARY3. ROLE OF WHOLESALE MARKETS IN SALES OF FRUITS AND VEGETABLES4. POSITION OF DOROZSMA WHOLESALE MARKET IN HUNGARY5. OBJECTIVES OF DOROZSMA WHOLESALE MARKET 6. ROLE OF DOROZSMA WHOLESALE MARKET IN SALES OF FRUITS AND VEGETABLES7. PRESENTING THE PRODUCER ORGANIZATIONS 8. POSITIONS OF PRODUCER ORGANIZATIONS I-II.9. FINDING OPPORTUNITIES FOR COOPERATIONS10. COMMON SUCCESS11. COMMON TENDER

CONTENT

• The spead of new commercial forms (the wide range of variety of fruits and vegetables available for the population in the big multina-tional stores) – in Serbia there isn’t any multinational store, wholesale markets have monopol situation

After joining the EU

• Growing supply, cease of the shortage economy

The large part of the consumption of households is the food.

A large part of the local small economics had been victims of the accession to the common market.

• Decrease the public purchasing power

• Changing habits of the consumers

Local position Global challenge

• Disintegration of the former producing and marketing channels (altering of the private ownership, new ways of sales channels appeared, privatization of food processing)

• Fossilized of agricultural problems (the goods flowing in from the more developed countries fill the quality shortage whereas there is redundan-cy in produced goods on the spot

1. SIMILAR PROBLEMS

2. POSITIONS OF WHOLESALE MARKETS IN HUNGARY

In the early 90’s it became obvious that which of the wholesale markets would be outstanding in our country

The largest markets: Budapest Wholesale Market (BWM), Dorozsma Wholesale Market (DWM), Miskolc Wholesale Market (MWM)

BWM: the goods offered decreased by 10% between 2003 and 2009

MWM: the level of producer sales decreased annualy by 15 %, decreasing demand

3. ROLE OF WHOLESALE MARKETS IN SALES OF FRUITS AND VEGETABLES

Tendencies of producting vegetables and fruits: Before joining the EU : 2,5-2,8 million tonneFort fluctuating because of the extreme wheather conditionsIn the next years the half of the domestic consumption will be

from the hungarian productingBetween 2001 and 2009 worth of export rose by 50%, the import

trippledConsumption of the vegetables and fruits : priceflexible, totally

reducedSince 2000 the quantity of the vegetables and fruits increased with

200 000 tonnes, (by 10-15% )

4. POSITION OF DOROZSMA WHOLESALE MARKET IN HUNGARY

Dorozsma Wholesale Market plays a notable role :The second largest market in the country, and the biggest in the

region• The Economic Prestige Award: „Medium Enterprise of the Year” • The producers are primarily from the Southern Great Plain area• The dealers’ interest is international• Developments: investments worth HUF 850 million2 modern trading hall complexes, several packing material

storages, 500-tonne-capacity cold-store

5. OBJECTIVES OF DOROZSMA WHOLESALE MARKET

• To develop the Dorozsma Wholesale Market into an international agro-logistics centre complying with European standards

• Development of infrastructures• Networking • Cooperation with the serbian and romanian wholesale

markets

6. ROLE OF DMW IN SALES OF FRUITS AND VEGETABLES

Market share of the Ltd. in the target segments increased by 33,4 %The agglomeration of producers and dealers has stabilised The dealers take the produce to the Transdanubian Region,

Northern and Eastern Hungary, and to neighbour countries65% of the produced goods in the region will get to the Dorozsma

Wholesale MarketProducts going through our market fulfil the needs of about 200.000

homesAlmost half of our annual volume of goods comes directly from the

producers, and the others are foreign productsIn 2009 nearly 360 000 transporting veicles and 410 000 tonns of

goods got to the market

7. PRESENTING THE PRODUCER ORGANIZATIONS (OP)

Form establisement: cooperative, ltd, plc or other organizationsThe producers own membershipThe aim of the establisement is that promoting producers can

reach the market, moreover to improve their market positions . Have the right to obtain resources from the EU

Before joining the EU 100 producer organizations were establised, eversince their number halved

It provides for their members: secure market, organized sales, professional recommendations and other services

Disadvantage: the producer gets the money more slowly, usually gets lower price, administration

8. POSITIONS OF PRODUCER ORGANIZATIONS I.

20 000 members, 35 000 ha arable landTotal revenue: HUF 43 mrd in 2008 (HUF 36 mrd from

members)Part of the producer organizations’ sales is 20% of total sales

in the field of vegetables and fruitsProducer organizations in Csongrád county: Kunkert PO, Röszkert PO, HORTICO Vegetable PO, Forrásker-

PO, PaprikaKert PO Ltd., Mórakert Vegetable-Fruit PO, Southern Gardeners Vegetable-Fruit PO, FLORATOM-KER PO, KISTÉR- PO, Kistelek and Region PO, GREEN-Product PO, Gorzsai Pepper PO, DŐNE FRUCT Vegetable-Fruit PO

8. POSITIONS OF PRODUCER ORGANIZATIONS II.

Developing domestic producer organizations had stoppedCause: Black economy, increase of VATSouthern Plain producer organizations’ financial situation became instableDebts towards members

In the long run it could be the potential competitor of Dorozsma Wholesale Market however in the short run the suppliers would prefer to market their products in the wholesale market

Joint development of local agricultural markets, joint the global markets by achieving the critical mass

Producting the local stability fund of product that suitable the standards of the Union (food safety, standards, regulations)

Development of infrastructure (market hall, parking places, stb.)

Joint border tenders, complamentary developments

Electronical sales (virtual produce exchange) common marketing (exhibition)

Sale

Logistics

Quality of product

Special field Activites

9. FINDING OPPORTUNITIES FOR COOPERATIONS

Ensure the stable revenues for the sustainable local governments

•Ensure cheap and qualitative products for the inhabitants and agglomeration of producers and dealers

•Ensure competitiveness for the agricultural enterprises

Strategical european cooperation between the two country with promoting their own and special products

Fortify the center positioned local agricultural market-places of great importance

Aim Results

10. COMMON SUCCESS

11. COMMON TENDER Enhancing economic cooperation in the field of integrated agricultural supply of goods along the

Serbian-Hungarian borderApplication ID: HU-SRB/0901/211/159Name of the Lead Beneficiary: City of SuboticaTotal project budget: 180 000 EURRequested IPA funding: 153 000 EUROwn contribution: 18 000 EURState contribution: 9 000 EURResults of the project: The experience exchange regarding market-places, retail and wholesale market-places,

and producers Establishment and harmonization of models of wholesale market-places with the

network of regional wholesale market-places and buy-up centres Establishment of an integrated agricultural supply of goods in the border region adjusted

to market demand Extension of market-place assortment with more organic valuable products Promoting market-place activities and quality labelling of regional and local products as

well as more efficient informing of target groups. Awareness raising and training of relevant target groups.

THANK YOU FOR YOUR ATTENTION!

Address: H-6791 Szeged, 2-4. Kettőshatári Road

Phone: +36-62/461-095Fax: +36-62/559-651

E-mail: toroknekatalin@dornagypiac.huwebsite: www.dornagypiac.hu