Conditions and challenges to dairy sector in Bulgaria

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Conditions and challenges to dairy sector in
Bulgaria

• Atanas Kiskinov
• National Dairy Board
• Co-financed by the European Union within the
  programme "Europe for Citizens" 2007 2013

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National Dairy Board - structure

• General Assembly
• Board of Directors
• Executive Director
• General administration
• Administration with specific functions

Eight Regional Dairy Boards Sliven, Plovdiv,
Kyrdjali, Blagoevgrad, Vratsa, Pleven, Ruse,
Dobritch
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Representation and support of its members
interests before the governmental and
non-governmental institutions, organizations and
other parties. - Co-operation, assistance and
information exchange among its members - NDB
give consultancies and carries out informational
campaigns upon implementation of Bulgarian and
European legislation in dairy sector, upon the
Rural Development Programme 2007-2013 - Gives
proposals to the Minister of Agriculture and
Foods concerning allocation of financial aid for
milk producing - Carries out activities for the
purpose of increasing Bulgarian dairy farms
competitiveness - Collects and summarizes
information coming from the Regional Boards and
if necessary NDB notifies the government and asks
for dairy market interventions
National Dairy Board tasks
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National DAIRY Board takes part

• In drawing-up and implementation of dairy sector
  strategic plans
• In drawing-up of dairy sector annual reports
• In developing of legislation concerning dairy
  sector

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Allocation of milk producing farms
2005 ?. 2006 ?. 2007 ?. 2008 ?.
Number of dairy farms 152 900 136 400 122 900 103 900
Number of dairy cows 368 800 345 500 342 500 333 000
Number of sheep farms 201 700 181 200 172 300 152 700
Number of sheep 1 330 200 1 309 400 1 268 600 1 189 800
Number of goat farms 229 400 196 400 170 700 154 800
Number of goats 590 200 507 500 446 500 411 700
Number of buffalo farms 1 200 1 500 1 300 700
Number of buffalo-cows 4 800 4 300 4 600 5 400
Total milk production 1 508 069 1 515 637 1 327 461 --------
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Decrease in overall number of milking animals in
Bulgaria

• Jan 1st 2008 decrease of the total number of
  animals in milking farms in relation to the same
  period of the previous year
• Dairy cows decrease 2,8 (332,9 thousand cows),
• Milking sheep decrease 6,2 (1 189,8 thousand
  sheep),
• Milking goats decrease 7,8 (411,7 thousand
  goats)
• At the end of 2008 total number of milking
  animals decreased 2,5 in relation to the end of
  2007 and the number is about 1 822,5 thousand.

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Farms groups by legislation

• First group (category)
• Meet veterinary-sanitary requirements for
  establishment and equipment
• Produce milk with the following indicatior
• Total Bacteria Count lt 100 000/ml
• Somatic Cell Count lt 400 000/ml
• Second group (category)
• - Meet veterinary-sanitary requirements for
  establishment and equipment
• Produce milk with indicators over
• Total Bacteria Count lt 100 000/ml
• Somatic Cell Count lt 400 000/ml
• Third (category)
• DO NOT meet veterinary-sanitary requirements for
  establishment and equipment
• Produce milk with indicators over
• Total Bacteria Count lt 100 000/ml
• Somatic Cell Count lt 400 000/ml

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Dairy sector trends

• Increase in the number of the First group farms
  and decrease of Second group farms (passing from
  Second to First). There is no active efforts for
  passing from Third group to First and Second.
• Bigger farms increase in the average number of
  animals per farm
• Decrease in total number of milking animals in
  Bulgaria
• Decrease in total quantity of milk produced in
  Bulgaria - 7.7 down in relation to the previous
  year

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Dairy processing companies (DPC) in Bulgaria
Number of DPC DPC eligible to sell on the EU market
1989 ?. 53 none
1995 ?. 826 none
2000 ?. 470 4
2003 ?. 330 14
2005 ?. 273 33
2006 ?. 208 34
2007 ?. 223 22
Oct 2008 ?. 237 86
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Dairy products foreign trade
2005 ?. 2006 ?. 2007 ?. 2008 ?. Jan-Jun
Import, tons 20 944 20 902 29 804 20 223
Export, tons 18 804 15 854 23 242 14 032
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Milk and dairy products import, tons
Products 2004 2005 2006 2007 2008 Jan-Jun
Milk, cream - non-concentrated and non-sweetened 198 183 294 4 477 4 076
Milk and cream concentrated and sweetened 12 168 8 380 8 183 11 107 9 393
Yoghurt and yoghurtlike products 75 129 167 752 387
Whey concentrated or powdered 5 845 6 668 7 299 7 678 3 482
Butter 2 040 1 861 1 361 1 693 1 273
Cheese 4 107 3 723 3 598 4 097 1 612
Total 24 433 20 944 20 902 29 804 20 223
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Milk and dairy products export, tons
Products 2004 2005 2006 2007 2008 Jan-Jun
Milk, cream - non-concentrated and non-sweetened 225 266 316 672 531
Milk and cream concentrated and sweetened 76 28 79 1 047 480
Yoghurt and yoghurtlike products 108 239 1 100 4 334 2 826
Whey concentrated or powdered 2,5 6 4 64 55
Butter 149 2 366 570 1 083 503
Cheese 15 228 15 899 13 784 16 042 9 617
Total 15 788 18 804 15 854 23 242 14 032
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Dairy sector opportunities

• Improvement of produced milk quality
• Extension of farms capacity
• Implementation of new technologies and genetics
  practices
• BIO-Agriculture development
• Development and launching of new dairy products
• Positioning and promotion of new dairy products
• Improvement and strengthening the connection
  between milk producers and dairy processors
• Improvement of management knowledge and
  abilities, as well as the effectiveness, of
  dairy farms and dairy companies
• Opportunities of Rural Development Programme
• Structural switch to milk-sheep-breeding,
  milk-goat-breeding, milk-buffalo-breeding
• Legal protection of traditionalli specified
  products

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Dairy sector threats

• High number of small and uncompetitive farms
• Decrease in number of farms
• Import competitive pressure
• Low rate of waste conversion solutions
• Low productiveness, low level of genetics used in
  the farms
• Decrease of overall milk production
• Serious differences in raw milk quality
• High expenses concerning quality control in farms
  
• Lots of farms will die for not meeting the
  hygiene requirements
• Economical instability decreases the farmers
  willingness to invest and improve milk quality
• Poor management knowledge and abilities in farms
  high expenses
• Low consumers purchasing capacity
• Social risks concerning the owners and employees
  of the closed farms

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Troubles

• Government cannot answer effectively to the dairy
  sector crisis
• There are not clear priorities and goals of the
  state financial aid even farms not meeting the
  requirements gain financial support
• Slow and ill-working cow milk quota system
• Long delay in establishment of specialized
  laboratories for raw milk quality control
• Bank credit crisis impacts on the process of
  gaining support through the Rural Development
  Programme
• Usage of plant fat and other supplements in
  traditional products which leads to loss of trust
  on the Bulgarian and foreign market.

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Opportunities

• Measures for making it easier for the dairy farms
  to gain bank credits.
• Developing of new dairy products, promotion and
  common efforts for expanding the dairy market
• Prolonging the transitional period after 2009 for
  farms working on projects under Rural Development
  Programme
• Differentiation in financial support between
  business-oriented big farms and small farms
  (socially significant)
• Development of integral strategic plan for dairy
  sector development with the active participation
  of branch organizations

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Thank you for your
attention!ContactsE-mail office_at_nmb.bg?el
02/942 1999