estonian agriculture, rural economy and food industry

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8. Dairy industry is the largest Dairy industry accounted for 28%, the meat industry 15.8%, the fish industry 15.3%, the beverage industry 21.5%, flour and cereals production 0.7% and bread and baker's wares 8.7% of the total food industry in 2000. Investments The food industry has made substantial investments in the improvement of processing conditions and production efficiency in the recent years. Great attention is now being paid to the health of the consumer and the related improvement of food safety. About 300 million EEK was invested in the non-current assets of the food industry in 2000. As from 1 January 2003 the Food Act will enter into force in full and this implies that food handlers continue to be required to make great investments in food safety assurances. Enterprises have to invest mainly in order to comply with the general and special requirements of food safety. General requirements include requirements for production buildings, facilities, walls, ceilings, floors, and the dressing rooms of employees. Special regulations cover the requirements for equipment and means of handling. Investments made in compliance with special requirements so far show that enterprises do pay the necessary attention to product safety as well as product quality. When compared to other areas of agricultural production, relatively greater foreign investments have been made in the food industry. The main investments in 2000 were made in the dairy industry. Foreign investments in beer, meat, and bread production have already been made in previous years. The fish industry has proved to be less attractive for foreign investors. TABLE 1. Millions of kroons, % 1994 1995 1996 1997 1998 1999 2000 Total food industry output (millions of kroons) 6 513 7 554 8 534 10 903 10 802 8 433 8727 Meat and meat products Fish and fish products Milk products Flour and cereals Ready-made feedstuff Baker's wares Beverages 1 382 627 1 195 51 363 507 890 1 221 1 156 1 368 62 361 606 1 091 1 241 1 039 1 883 79 292 756 1 54 1 237 1 492 2 260 91 246 929 1 566 1 454 2 055 2 983 87 351 984 1 806 1 533 1 938 3 022 103 412 995 1 721 1380 1349 2435 58 299 759 1874 Employment in the food industry (% of total employment in the processing industry) 23.8 24.6 23.7 24.4 24.5 21.5 19,9 Export of food industry (millions of kroons) Relative share in total export (%) 2 028 12.3 1 496 7.1 1 977 7.9 3 543 8.7 3 735 8.2 2 417 5.6 2392 4.4 28
8. Concentration The concentration of enterprises varies across branches of the food industry. The most concentrated is the beer industry, where the four major breweries account for 97% of total sales. The meat industry is also fairly concentrated: the four major industries yield 80% of total sales. The milk industry is so far less concentrated: four major enterprises only account for 40% of the total sales of this branch of industry. Concentration can be expected to increase in the fish, meat, and milk industries in the forthcoming years. One of the reasons for this is the stricter food safety requirements: smaller industries are not able to make the necessary investments to comply with these requirements. On the other hand, competition between enterprises toughens both in regard to finding markets and market penetration. As major enterprises prove to be stronger in competition, smaller industries should merge with large-scale industries. Best Estonian Food competition The Best Estonian Food competition has been held annually since 1994, its initiator and organiser is the Estonian Association of Food Industries. The goal of the competition is to encourage entrepreneurs to develop new products and improve product quality. The competition is also a channel for introducing products to consumers and trade enterprises and to shape a positive attitude and trust toward domestic food and the food industry. A total of 627 products from 91 enterprises have participated in the seven competitions held so far. Since 1999, export potential has been assessed alongside the novelty and healthiness of the competing products. Eighty-seven products from 24 enterprises participated in the competition in 2000; 27 products were assessed as being suitable for export. The packages of products that have won the competition bear a special label, which has been granted to 97 products so far. Milk products have won the Best Estonian Food competition the greatest number of times. According to the data of the Estonian Institute of Economic Research, 55% of buyers are familiar with the Best Estonian Food mark. Meat processing concentrates in large-scale enterprises There are presently many small meat processing enterprises in Estonia. As it is difficult for small enterprises to comply with food safety requirements, the meat industry is concentrating and undergoing structural changes. As a result of this process, up to 30% of the presently more than two FIGURE 1. 40% 30% 20% 10% 0% FIGURE 2. 30% 25% 20% 15% 10% 5% 0% Share of food industry in industrial output 37,7% 31,6% 32,8% 28,9% 27,2% 26,9%33,4% 27,8% 25,1% 1992 1993 1994 1995 1996 1997 1998 1999 2000 Milk Structure of food industry sectors in the food industry total output Beverages Meat Fish Bread and baker’s wares 1999 2000 Other 29
Page 1 and 2: ESTONIAN AGRICULTURE, RURAL ECONOMY
Page 3 and 4: Contents 1. What Estonia is like 3
Page 5 and 6: 1. What Estonia is like Estonia is
Page 7 and 8: 1. Climate • Estonia’s climate
Page 9 and 10: 2. Reforms have changed Estonian ag
Page 11 and 12: 2. rural inhabitants in agriculture
Page 13 and 14: 3. Trade is largest with European U
Page 15 and 16: 4. Economic results of agriculture
Page 17 and 18: 4. smaller enterprises (up to 40 ha
Page 19 and 20: 4. in ownership relations, a situat
Page 21 and 22: 5. Young people are interested in a
Page 23 and 24: 5. forestry, and processing of agri
Page 25 and 26: 6. Forests are an important natural
Page 27 and 28: 7. Fishing is an important industry
Page 29: 8. Food industry yields a quarter o
Page 33 and 34: 9. Measures taken to assure food sa
Page 35 and 36: 10. Rural enterprise is developing
Page 37 and 38: 10. ments, development of alternati
Page 39 and 40: 11. Different landscape types have
Page 41 and 42: 11. tion areas. The areas belonging
Page 43 and 44: MINISTRY OF AGRICULTURE STRUCTURE A

estonian agriculture, rural economy and food industry

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