Food Industry Study in Southeast Europe - AHK Mazedonien - AHKs

Food Industry Study in Southeast Europe 

Final Report 

Southeast Europe 

Presented to 

Deutsche Investitions- und Entwicklungsgesellschaft, DEG 

December 2010

Your contact person 

with GFA Consulting Group is 

Inge Gärke 

Food Industry Study 

in Southeast Europe 

Final 

GFA Consulting Group GmbH 

Eulenkrugstraße 82 

22359 Hamburg 

Germany 

Telephone 0049-40-60306-170 

Telefax 0049-40-60306-179 

E-Mail Inge.gaerke@gfa-group.de

TABLE OF CONTENT 

FOREWORD 

1 OVERVIEW ON THE REGION 

1.1 General overview 

1.2 Sub-sector overview 

2 FOOD INDUSTRY IN THE DIFFERENT COUNTRIES 

2.1 Serbia 

2.2 Croatia 

2.3 Bosnia and Herzegovina 

2.4 Moldova 

2.5 Albania 

2.6 Kosovo UN Res. 1244 

2.7 FYR Macedonia 

2.8 Montenegro 

ANNEX: Bibliography and interesting Links 

I 

1 

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3 

9 

9 

18 

25 

30 

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42 

47 

53

LIST OF ABBREVIATIONS 

APF Agricultural Policy Forum 

BAM Bosnia-Herzegovina Convertible Mark 

BAS Business Advisory Services 

BiH Bosnia and Herzegovina 

bln Billion 

BMELV 

German Ministry of Food, Agriculture and Consumer 

Protection 

CEFTA Central European Free Trade Agreement 

CeProSARD 

Centre for promotion of sustainable agricultural practices and 

rural development 

CPI Corruption Perception Index 

DEG 

Deutsche Investitions- und Entwicklungsgesellschaft mbH 

(German Investment & Development Company) 

EBRD European Bank for Reconstruction and Development 

EFSE European Fund for South East Europe 

EIB European Investment Bank 

ETC Early Transition Country 

EU European Union 

EUR Euro 

FAO Food and Agriculture Organisation 

FDI Foreign direct investment 

FYR Former Yugoslav Republic (of Macedonia) 

FTA Free trade agreement 

F&V Fruits and vegetables 

GAP Good Agricultural Practices 

GDP 

Gross domestic product 

GFFA Global Forum for Food and Agriculture 

HACCP 

Hazard Analysis Critical Control Point 

HQ 

Headquarters 

HRK Croatian Kuna 

IFC International Finance Corporation 

IFI International finance institution 

IPF Infrastructure Projects Facility 

ISO International Organization for Standardization 

KfW Kreditanstalt für Wiederaufbau 

MCC Millennium Challenge Corporation 

MDL Moldovan Leu 

MKD Macedonian Denar 

mln Million 

n/a Not applicable 

OA 

Ost-Ausschuss der Deutschen Wirtschaft 

(Committee on Eastern European Economic Relations)

OMV 

Ost- und Mitteleuropa Verein e.V. 

(East and Central European Business Association) 

PET Polyethylenterephthalat 

SD Serbian Dinar 

SEE South East Europe 

SEEC South East European Countries 

SME Small and medium enterprises 

SWG Standing working group 

SWOT Strengths, weaknesses, opportunities, threats 

TAM Turn Around Management 

TC Technical cooperation 

UHT Ultra-high temperature processed 

US(A) United States (of America) 

USAID United States Agency for International Development 

USD US Dollar 

VAT Value added tax 

WTO World Trade Organisation

FORE WORD 

DEG as the private investment daughter company of KfW seeks to boost private 

investments in the region South Eastern Europe, in order to assist long-standing 

economic growth and modernisation of the food industry in these countries. 

DEG has contracted GFA Consulting Group GmbH to summarise information from 

existing studies and information on the food industry in eight (8) countries in South East 

Europe (Albania, Bosnia and Herzegovina (BiH), Croatia, Kosovo UN Res. 1244, FYR 

Macedonia, Moldova, Montenegro, and Serbia), with a particular view on identifying 

potential larger-scale investment opportunities. 

From October to December 2010, GFA has conducted a review of existing studies and 

exchanged with experts and organisations (investment promotion agencies, trade 

chambers, etc.) during short visits to the countries. Besides the core team of Inge 

Gaerke, Sigrid Giencke, Zoran Kapor and Conrad Hoyos, we have involved the following 

local short-term experts: Nikola Karabasil (Serbia), Ana Marusic Lisac (Croatia), Ardian 

Marku (FYR Macedonia), Edin Focis (BiH), Aida Nani (Albania), Oleg Stipca (Moldova), 

and Fatmir Selimi (Kosovo). Further, we would like to thank the various interviewed 

persons as well as Gabriele Wäschle & Kathrin Matzen for final editing. 

i

1 OVERVIEW ON THE REGION 

1.1 General overview 

Overall, there is a population of approximately 28 million inhabitants in the 8 SEE countries. In 

the following, we have presented the 8 countries not in alphabetic order, but in order of the size 

of their population. The size of the population as well as GDP per capita, the income distribution 

and consumption patterns determine the size of the potential local food market. 

Ser Cro BiH Mol Alb Kos Mac Mon 

Population (million) 7.3 4.4 3.9 3.6 3.2 2 2.0 0.6 

Land (mln ha) 8.8 5.6 5.1 3.4 2.9 1.1 2.6 1.4 

Agricultural land 5.1 3.2 2.2 2.5 1.1 0.5 1.2 0.5 

Arable land (mln ha) 4.2 1.2 1.1 1.8 0.6 0.3 0,5 0.05 

GDP total 

30.5 45.4 12.1 3.9 7.9 3.8 US$ 3 

(bln €, 2009) 

4.48 

GDP/capita (€, 2009) 4,093 12,630 3,159 1,085 2,491 1,731 3,280 4,500 

GDP growth 

(est. 2010, IMF) 

1.5 -1.5 0.5 3.2 2.6 4.6 1.2 -1.8 

Contrib. F&A to GDP ~18% ~13% ~10% ~ 30% ~21% ~7% ~10% ~8% 

Contrib. F&A to 

Exports (%) 

~23% ~11% ~6.3% ~ 65% ~16% ~16% ~11% ~11% 

Corporate tax 10% 20% 10% 0% 10% 10% 10% 9% 

VAT 18% 23% 17% 20% 20% 16% 18% 17% 

VAT reduced / 

8% 0% 17% 8% or 20% 16% 5% 7% 

basic food 

lower 

Tax burden (% tax & 

duties in company 

profit, 2008) 

34 33 27 31 45 28 16 29 

Gross wage/ 

month (€) 

~500 ~1000 ~600 ~200 ~ 250 ~200 ~400 ~ 400 

Rank CPI, 

(Transparency) 

78 62 91 105 87 110 62 69 

Rank Ease of Doing 

Business, Rank 

89 84 110 90 82 119 38 66 

Rank Global 

Competitiveness 

96 77 102 94 88 n/a 79 49 

CEFTA x x x x x x x X 

EU accession status Pot. Cand Pot. _ Pot. Pot. Cand. Pot. 

Cand 

Cand. 

Cand. Cand 

Cand 

WTO membership -in Since -in Since Since - Since - in 

negot. 2000 negot. 2001 2000 

2003 negot 

Note: F&A = food and agriculture 

Food Sector Study South Eastern Europe - 1

The food and agricultural sector is still very important in the region, contributing significantly to 

GDP and to exports of the countries. However, most of the countries are net importers of food 

and agricultural products, contributing to the large trade balance deficits that the countries are 

facing. The sector is important for its contribution to overall employment, bearing in mind that 

generally, unemployment is quite high in these countries and has considerably increased since 

the global financial crisis. On the other hand, there is a strong tendency of rural depopulation in 

these countries, leading even to some seasonal labour shortages in rural areas, and also 

leading to a certain percentage of uncultivated land. 

All 8 SEEC are parties to the Central European Free Trade Agreement (CEFTA), which 

entered into force in 2007 (see www.ceftatradeportal.com). CEFTA has the purpose of removing 

trade barriers (tariff and non-tariff barriers); however, the process is still ongoing. 

The EU has established a Western Balkan Trade Pact, which was extended in October 2010. 

According to this, almost all products from the Western Balkans can be imported customs free. 

For some products such as wine, baby beef and certain fish products, there are preferential 

tariff quotas. So far, the import quotas have often not been used fully. 

Some of the countries have bilateral trade agreements, e.g. Serbia with Russia, Kosovo with 

the US, which also offers opportunities for customs-free export outside CEFTA and the EU. 

Advantages of the region regarding investments in the food industry: 

• 28 million consumers live in the region (~55 million in the wider region including Romania 

and Bulgaria). 

• Political situation is stabilized and the economies show a long-term growth trend. 

• Number of larger supermarkets with growing demand for reliable, standardised local supply 

is increasing (‘retail revolution’). 

• Number of larger processing companies with modern quality management systems 

(HACCP, ISO) is increasing. 

• Mergers and acquisitions will continue in the region, in particular in the retail sector and in 

enhancing vertical integration within the value chain. 

• Consumption patterns are changing (less domestic production). 

• There are considerable infrastructure and agricultural investments planned in the frame of 

EU accession or EU neighbourhood. 

• Investments into domestic production can contribute to reducing trade balance deficits 

(most countries are still net importers of food). 

� Opportunities on local markets exist. 

• All 8 countries are parties of CEFTA (Croatia only, until it enters the EU). 

• These countries are EU candidate or potential EU candidate countries (except Moldova) 

resulting in a need of the food industry to comply with EU regulations and to increase 

competitiveness towards EU companies. 

• Customs-free access to EU market (EU-Western Balkan Trade Pact). 

• Additional bi-lateral free-trade agreements allowing customs-free access to further markets 

(e.g. Serbia with Russia). 

� Opportunities for exports to the region, to EU, and other markets 

(in particular wine, fruits and vegetables, niche products) exist. 


Major Challenges / Risks remain: 

• Fragmented primary production leading to limited quantities of raw materials, higher costs of 

primary production, quality control and logistics (in particular for milk) 

• There are only a few larger processing companies, all others are small to medium-sized and 

productivity is often lower than in EU countries. 

• Oligopoly structures in the retail sector lead to less negotiation power of suppliers. 

• Even if quality management has improved during recent years, there is still a need for 

further improvement. 

• Some countries have not yet fully established the food safety system to export to the EU 

(which is in particular relevant for export of products of animal origin). 

• Logistics and Marketing are not yet so well developed. 

• Croatia will face strong competition, upon entering the EU. 

• Low purchasing power of the local population (the region is expected to need longer for 

recovery from the financial crisis, and faces increasing unemployment). 

• Strong depopulation of rural areas leads partly to labour shortage in rural areas. 

Most interesting countries for larger investment (>1 million EUR) in the food industry are 

Serbia and Croatia, followed by FYR Macedonia. Further, Moldova and Bosnia and 

Herzegovina can be interesting for larger scale investments if the regulatory environment further 

improves. In Albania, Montenegro and Kosovo, there is only limited potential for larger 

investments as most companies in the food sector are small. 

As there is currently a concentration process ongoing with strong acquisition activities of 

larger holdings (e.g. Agrokor, Croatia; Delta, Serbia) or investment funds (e.g. Danube Food 

Groups / Salford), the assessment of the sub-sectors is becoming less relevant than the 

selection of the right conglomerate. 

Potential investments can be for the following purposes: 

• Mergers and acquisitions; 

• Expansion on the domestic and regional market (e.g. new retail markets); 

• Expansion of production facilities (e.g. cooling, freezing, processing, new production lines); 

• Modernisation of production facilities (e.g. to improve productivity, to improve quality, to 

improve energy efficiency); 

• Logistics, packaging and marketing (e.g. logistic centres, storage, packaging, 

trucks/vehicles). 

1.2 Sub- sector overview 

1.2.1 Retail and wholesale 

During the last years, the region has experienced a ‘retail revolution’. Supermarkets and 

hypermarkets have been opened, and consumption has strongly shifted from smaller shops and 

groceries to supermarkets. This trend seems to have been accelerated during the food price 

crises in 2008 and the financial crisis in 2009. Supermarkets and hypermarkets were specifically 

offering discount foodstuff to attract customers looking for good bargains during difficult times. 

Another trend during the last years was that some larger retailers have grown constantly 

(through investments and acquisitions) and are now determining the market. As food sales are 

increasingly through supermarkets and hypermarkets, retailers are also getting increasing 

power over manufacturers and can, for example, increase shelf prices. 


Most of the retailers started in the capital cities and larger towns, but also extended now to 

smaller cities. Mergers and acquisitions are quite common and frequent. In some countries, 

there are market entry barriers for e.g. foreign retail chains, with a tendency to strong oligopoly. 

Products in these supermarkets are still often imported. However, step by step, imported 

products are also replaced by products from increasingly strong and reliable local suppliers, 

who are able to deliver the needed quantities in the qualities (ISO, HACCP), and packaging 

required. The need for processors to grow and to modernise will further increase, as 

supermarkets do not want to buy from a large number of smaller producers. Some retailers also 

invested in companies with own processing facilities and sometimes even primary production. 

Establishment of ‘private label products’ (e.g. Premia / Delta) are also increasing, often through 

supply contracts. 

Some countries have been trying to force retail chains to offer a specific percentage of local 

products of the overall products (Serbia, BiH), but this does not seem to be conform to EU 

regulation on open competition. However, there may be a raising interest to raise public 

awareness about ‘buying local/regional’, which may lead to stronger market pressure on the 

supermarkets to search for and develop local supply. 

Fast food chains are not expanding with such as speed as it was seen in Eastern Europe. So 

far, there are some McDonald, Pizza Hut, KFC branches, but not in a significant number. South 

East Europe has a tradition and established companies with own fast-food products (e.g. bakery 

products/burek, pizza, cevapcici, etc.). 

Market opportunities exist: 

• New retail markets in smaller towns outside the capital cities; 

• New retail markets in those countries, where the market is not yet saturated (e.g. Albania, 

Kosovo); 

• Sale through mini-markets in the centres and/or in residential areas. 

Investments have taken place and may further take place in the area of: 

• Expansion through mergers & acquisitions in the domestic market and in the regional 

market; 

• Green field investments (new supermarkets, hypermarkets, discount markets); 

• Acquisition of small shops to establish chains of mini-markets; 

• Acquisition of companies with processing facilities; 

• Establishment of ‘private labels’ of the retail chains. 

In some countries, saturation of the retail market is almost reached. In those cases, acquisitions 

are more common than new green field investments. 

1.2.2 Wine industry 

During the last years, larger private companies have developed, either: 

• via privatisation of state-owned companies, 

• via expansion of existing smaller vineyards and processing facilities, 

• via green field investments by local companies. 

Some vineyards and wineries are still not yet privatised (e.g. 13 jul Plantaze, Montenegro, and 

some of the Kosovo wineries). 

In most of the eight countries, the wine industry is strongly protected via high import duties (e.g. 

45-50% in FYR Macedonia). Main risk is that imports may flood the domestic and regional 

markets, once import tariffs decrease. 

Some countries are traditional exporters of wine (e.g. FYR Macedonia, Moldova), but the export 

is mostly in bulk. During the last years, modernisation and investments have taken place. 

Certifications such as ISO 9000:2001 and HACCP have been introduced, and a number of 

wines from the regions received awards and prices. 


Market opportunities exist: 

• on the domestic market to a certain extend (more consumption is expected with increasing 

disposable income, sale through supermarkets is expected to increase, i.e. wine of high 

brand recognition and medium to low prices); 

• on the regional export market, in particular Serbia; 

• on other export markets (in particular EU) based on increasing information about the quality 

wine from the region, and facilitated because of preferential trade agreements. 

Investments have taken and may further take place in the area of: 

• Privatisation (acquisition of former state owned wineries) and other merger & acquisition; 

• Investments in wine processing facilities mostly coupled with investments in vineyards 

(primary production); 

• Investments in wine tourism / rural tourism / wine festivals; 

• Investments in wine shops. 

1.2.3 Fruits and vegetables 

The region has favourable climate and soil conditions for fruit and vegetable production. As this 

production is also labour intensive, the relatively low labour costs are playing in favour of this 

sub-sector. Often, fresh or frozen products are exported; processed products are still mainly for 

the domestic and regional markets with some exceptions. Main fruit exporter in the region is 

Serbia, main vegetable exporter is FYR Macedonia. 

Fruits: Serbia is the world’s third largest producer of raspberries, and is also known for its sour 

cherries, blackberries, blueberries, apples and plums. Montenegro is producing peaches and 

mandarins on larger scale, peaches on the 13 jul Plantaze, and mandarins on private farms in 

the South of the country. Fruits are processed often into juices, jam and marmalade or frozen 

(e.g. in Serbia or Macedonia). 

Vegetables: The region is strong in vegetable production and processing. Vegetables are often 

sold as fresh products (in particular for early production). Increasingly, freezing facilities are 

available, and fresh frozen products are exported. Processed vegetables are mainly based on 

tomatoes (e.g. ketchup), pepper/paprika (e.g. Ajvar, Lutenica), and potatoes (e.g. chips). Potato 

production and processing seems to become more important, in particular for supply to local 

and/or international fast food chains. FYR Macedonia is the main exporter of fresh and 

processed vegetables in the region. The climate is favourable and allows greenhouse 

production without heating. Exports are mainly going to Serbia, Croatia, Bulgaria, some also to 

the EU. However, the competition of countries with similar climate, but with modernised 

production and processing structures and well developed logistic systems (Turkey, Greece, 

Italy, Spain, etc.) is strong. 

Organic farming: There is a great hope that organic farming and export of organic products will 

be interesting. However, this may well remain niche area, as even for organic farming, large 

production sizes are needed in order to stay price competitive and to assure a regular supply 

with standardised and certified products in sufficient quantities. 

Market opportunities are in the area of: 

• Sale of fresh and frozen products (in particular fruits from Serbia and early vegetables from 

Macedonia) on the domestic, regional, and - to a certain extent – on the EU market and 

other markets outside CEFTA and EU; 

• Processed vegetables (in particular specialised products such as Ajvar and Lutenica, 

soups and other finished meals) for domestic and regional market; 

• Processed fruits (in particular juices, jam) for the domestic and regional market; 

• Meal solutions (soups, microwave products); 

• Organic products for export (if sufficient quantities). 


Investments have taken place and can further take place in the area of: 

• Freezing facilities, storage, packaging; 

• New facilities for fruit processing (juices, jam, etc.); 

• New equipment and production lines for vegetable processing (e.g. for production of potato 

chips or French fries); 

• Greenhouse primary production; 

• Modern irrigation systems (e.g. in Macedonia, Moldova), mostly with public investment 

support. 

However, investments – besides large public funded irrigation investments - are usually 

relatively small (smaller than 1 million EUR) and may also stay relatively small in the future. 

1.2.4 Beer and other beverages 

Beer was the first area towards foreign direct investment in the food industry was directed in the 

1990s. Thus, most large breweries belong now to international chains or investment groups. 

The soft drink market is also dominated by international companies, who have invested in local 

bottling facilities. However, some local companies have also entered this market segment in the 

last decade. Fruit juices are increasingly interesting, and often produced and distributed by local 

companies. Bottled water has attracted strong interest during recent years, in particular in BiH 

and Montenegro, where there are large quantities of good quality water in the mountainous 

areas. 

Market opportunities: 

• Bottled water; 

• Fruit juices (100% fruit content); 

• Specialised beverages (energy drinks, sport drinks, protein mixtures). 

Investments have taken place and may further take place in the area of: 

• New facilities for bottled water; 

• Mergers and acquisitions; 

• Modernisation of facilities; 

• New production lines for fruit juices; 

• Product development (e.g. energy drinks); 

• Packaging (PET, Glass, etc.); 

• Marketing and distribution. 

1.2.5 Meat sector 

Meat processing went through a modernisation and growth period. Most of the larger 

processors have nowadays modern quality management systems (ISO, HACCP), and some 

companies also have Halal certificates (e.g. in BiH) or Gost-R (e.g. in Moldova, Serbia), the 

latter being important for export to Russia. Most of the production is aimed at the local market 

(import substitution). Besides the domestic market, the regional market (CEFTA) is of growing 

importance, and the export of some special products (lamb meat, smoked ham) to EU partners 

and abroad. However, the fragmented primary production leads to insufficiencies in raw material 

supply. 

Market opportunities are in the area of: 

• Domestic and regional market; 

• Export of lamb meat and baby beef (EU import quota for baby beef); 

• Export of specialised products (sausages, smoked ham). 


Investments have taken place and may further take place in the following areas: 

• Building and equipment of new slaughterhouses or modernisation and equipment of existing 

processing facilities; 

• Building and equipment of new processing facilities or modernisation and equipment of 

existing processing facilities; 

• Trucks (with and without cooling) and other transport means; 

• Logistics centres; 

• Packaging; 

• Retail outlets (specialised on meat); 

• Quality management systems. 

A risk is still whether the local meat producers will be able to be price competitive in the long 

run. In some cases, the meat sector is protected (import duties or market barriers for foreign 

companies) leading to relatively high retail prices for meat products. If those barriers may 

become lower, local processors can face more intensive competition. 

1.2.6 Milk 

Primary production is extremely fragmented in the region, leading to high costs of production, 

collection and quality control. Productivity per cow is slowly increasing in all countries; however, 

the milk production per cow is still 50% below the EU average. Local dairies are often relatively 

small. During the last years, restructuring in this subsector can be observed with more and more 

international companies taking over local dairies (e.g. Meggle, Danone, Lactalis). 

Market opportunities are in the area: 

• Domestic and regional market; 

• Fresh milk, UHT milk; 

• Cheese for local taste; 

• New products (e.g. drink yogurt with fruits). 

Investments have taken place and may further take place in the following areas: 

• Merger & Acquisition; 

• Expansion of capacities (processing, cooling); 

• Trucks, logistics; 

• New product development, new production line (e.g. goat cheese, feta cheese, mozzarella, 

fruit yogurts); 

• Packaging and marketing. 

However, as primary production costs are high, this sector is seen as a risky one. 

1.2.7 Other Sub- sectors 

Bakeries / Flour Mills / Edible Oil 

There is a potential for further investments in bakery products / pastry, mainly for the domestic 

market. In particular BiH and Moldova have a wide variety of bakery products. 

Serbia is strong in the production of edible oil, and may further develop the local and export 

markets. 

Confectionery / snacks / ready-made meals 

There is a potential for investments in confectionery, snacks and ready-made meals, as this is a 

strongly growing market. However, as it demands strong marketing/distribution and product 

development capacities, it may be in the long run only relevant for larger companies with wellestablished 

brands, as it is otherwise difficult to compete against brands from the EU. 


Sugar industry 

Sugar beets are produced in Serbia, Croatia, Moldova, and partly in BiH. The processing is 

dominated by large international companies (e.g. Südzucker in Moldova, Hellenic Sugar in 

Serbia, previously also Nordzucker in Serbia). On the one hand, Europe in general has 

difficulties with price competitiveness since the liberalisation of the sugar market. On the other 

hand, recent price increases in sugar have made the sector again more interesting. Potential 

investment opportunities in the sugar industry have to be analysed on a case-by-case basis, as 

there are only a few large players in the sugar industry. 

Niche markets: 

Most of the niche markets are too small for larger investments above € 1 million. However, there 

may be exception that could be worthwhile examining more closely, such as: 

• Nuts (Moldova) 

• Fish (Croatia, Serbia, BiH) 

• Smoked ham (Montenegro) 

• Herbs and spices (Albania, Serbia, BiH) 

• Mushrooms (Serbia, Croatia, FYR Macedonia) 

Packaging: 

Most of the packaging material is imported (e.g. Tetra Pack, carton boxes). In Moldova and 

Serbia, there are larger glass factories. Foreign investments in (re-)packaging can be found in 

Albania as well as in Croatia due to growing demand. Besides these, there is a number of 

smaller packaging production (e.g. wooden boxes, cartons) and some re-packing facilities (e.g. 

by agricultural input suppliers). Investments in the packaging industry may be in energy 

efficiency measures (e.g. in glass factories), in packaging and re-packaging facilities combined 

with logistic centres, in carton and wooden box production, and in PET production. Larger scale 

production with economies of scale is important. 


2 FOOD INDUSTRY IN THE DIFFERENT 

COUNTRIES 

2.1 Serbia 


2.1.1 Food and Agricultural Sector 

Serbia is the largest market in the region with a long tradition in agriculture and a favourable 

climate. The agricultural sector plays a major role in the Serbian economy accounting for 18% of 

GDP and 23% of exports in 2009. Cereals, raspberries and sugar are the leading export 

products. Net exports of food and agricultural products reached over 600 million EUR in 2009. 

The food processing industry has strongly developed and grown during the years of transition. 

However, primary production is still very fragmented. Of the approximately 5 million ha of 

agricultural land, 90% are in private ownership. Agricultural holdings have mostly less than 50 

ha of land. Private farms have an average size of < 3 ha. 

In Serbia, as well as in Croatia, a trend in the food industry is the expansion and growth of 

conglomerates which are active in several sectors. The largest is Delta Holding, which consists 

of 30 dependent companies in various sectors, also active internationally in Bosnia and 

Herzegovina, Montenegro and Bulgaria. The second largest conglomerate in Serbia is Victoria 

Group, mostly present in the agriculture industry, the chemical industry and the financial 

services industry. Slightly smaller is Invej, which in its diversified business. The fourth major 

conglomerate active in agriculture is MK Group which is operating in the fields of agriculture, 

food, trade, logistics, renewable energy sources, real estate and financial services. 

Aside from conglomerates from Serbia, some non-Serbian based holdings are also worthy of 

mention. East Point Holdings Ltd. is a Cyprus based company (part of Point Group) in 

wholesale grain trading including milling and bakeries. The Danube Foods Group (DFG) 

operates mainly in the food sector in Serbia and the region. Other large holdings in the Serbian 

food sector are Atlantic Group (Croatia) through acquisition of the Slovenian Droga Kolinska 

and Agrokor (Croatia). 

Sub-Sectors Larger Companies (ownership) 

Retail & Wholesale Delta M (part of Delta Holding) 

Mercator (Slovenia) 

Metro Group 

Idea (Konzum – Agrokor, Croatia) 

Univerexport (retail) 

Nelt (wholesale) 

PTP DIS (wholesale and retail) 

DELTA DMD (wholesale) 

Fruits and 

FRIKOM (Agrokor) 

Vegetables 

Aleva 

MONDI Serbia (MONDI Foods Group) 

Confectionary Soko Stark (Atlantic Group) 

Bambi-Banat (DFG) 

Pionir 

Swisslion-Takovo 

Marbo Product (Pepsi International) 

Bakery “Klas” - Belgrade Bakery Industry (East Point Holding) 

Flour mills et pasta Fidelinka 

Zitko (part of Verano Group) 

Danubius (part of Delta Holding) 

Edible oil production Dijamant (Agrokor) 

Vital (Invej) 

Sunce (Invej) 

Wine Vino Zupa 

Rubin (Invej) 

Meat processing Carnex 

Matijevic 

Yuhor (Delta) 

Neoplanta (Nelt Company) 

Topiko (Perutnina Ptuj, Slovenia) 

IM Topola 



Dairies Imlek (DFG) 

Suboticka Mlekara (DFG) 

Sabacka Mlekara (Farmakom MB Concern) 

Somboled (Lactalis Group) 

Sugar Sunoko (MK Group) 

Crvenka (Hellenic Sugar Industry) 

Sajkaska (Hellenic Sugar Industry) 

Beer Apatinska brewery (CVC Capital partners) 

Carlsberg Serbia 

Soft Drinks Coca Cola HBC Serbia 

Nectar (fresh juices) 

Fruvita (juices) 

Mineral Water Knjaz Milos (DFG) 

BB Minaqua 

Hot drinks Grand Prom (Atlantic Group, Croatia), 

Doncafe (Strauss Group, Israel) 

2.1.2 SWOT analysis 

Strengths Weaknesses 

• Serbia is the country of the region with the 

largest size of arable land (5,1 million ha), 

it has fertile agricultural soil and favourable 

climatic condition, and an advanced agroindustry, 

in particular in Vojvodina. 

• Long tradition within the food industry. 

• Labour costs are relatively low. 

• Larger companies have invested into 

expansion, modernisation and quality 

management. 

• Serbia may soon get EU candidate status 

(2011), leading to increased pre-accession 

assistance and investments. 

• Fragmented primary production, leading 

partly to higher production costs and low 

technology in primary production. 

• Only a few brands are internationally 

recognized. 

• Besides some larger companies, many 

processors are still of small to medium 

size in international comparison. 

Opportunities Threats 

• Large domestic market, as Serbia is the 

country in the region with the highest 

population (7.4 million inhabitants). 

• Export Opportunities, in particular for fruits 

and cereals. 

• CEFTA member, and customs-free access 

to EU market. 

• Free Trade Agreement with Russia (160 

million consumers) and other countries. 

• Harmonization with the EU in process. 

• Possibility to lease state-owned agricultural 

land. 

• Low purchasing power of domestic 

consumers and high unemployment. 

• Dominance of larger players in the food 

trade leading to lack competition. 

• Import tariffs will be reduced, which may 

lead to increased imports of more price 

competitive products (e.g. meat, 

confectionery). 

• Liquidity planning is difficult due to delays 

in payments. 

• Depopulation of rural areas (partly 

leading to regional labour shortages). 

• Natural risks (floods). 


2.1.3 Interesting Sub- sectors and larger companies 

Retail & wholesale (food products) 

Retail: The mass grocery retail sector in Serbia is expanding on a large scale, confirming the 

“retail revolution” trend. The sector for retail of food products in Serbia over the last years has 

been characterised by strengthening positions of the large Serbian players (Delta), and the 

entrance of large regional players: several international players as Metro Group, Mercator 

(Slovenia) and Konzum (Croatia). 

• Delta M Group is the largest division of Serbian Delta Holding conglomerate and retail 

market leader. Delta owns several chains as the Maxi supermarket chain (Maxi Green 

supermarkets, Maxi bakeries and an online Maxi E-Store), C-Market and Pekabeta. Delta M 

also operates the cash-and-carry chain Tempo. Delta has registered operating revenues of 

980 million EUR in 2009. Delta is also present in the region, opening retail stores in BiH, 

with expansion in process in Montenegro and Macedonia. Delta is also active in Bulgaria 

after taking over one of the largest Bulgarian retail chains Pikadili. 

• Slovenian Mercator has overtaken the former Serbian Rodic as the second largest retail 

trader with registered operating revenues of 440 million EUR in 2009. 

• Croatian Agrokor Group, owner of Croatian market-leader Konzum, runs cash-and-carry 

stores under the name Idea Super in Serbia. Konzum also operates a number of outlets in 

the country, including Idea Mini, Idea Maxi and Idea Extra. Konzum is the third largest 

retailer in Serbia with operating revenues of 360 million EUR in 2009. 

• Germany’s Metro Group opened six Metro cash-and-carry stores in Serbia with a turnover 

of over 215 million EUR revenues in Serbia in 2009. According to Metro, the company’s 

current investment in the market is 100 million EUR and further expansion is planned. 

• Serbian Univerexport is also one of the leading retail chains in Serbia with a retail network 

including 30 retail stores, 5 wholesale stores and 3 subsidiary companies. Univerexport 

registered 143 million EUR revenues in 2009. 

• PTP DIS is a whole sale trader, and has a retail market chain and an own food brand 

“Dobro”. The company is characterized by a high rate of sales via internet. In 2010, DIS had 

9 retail supermarkets. In 2009 the company had 158 million EUR revenues. 

Wholesale: The wholesale sector in the food products is dominated by two companies: 

Nelt and Delta DMD. 

• Nelt (~ €199 mln turnover in 2009) is a Serbian wholesale trader expanding quickly due to 

distribution contracts with Procter&Gamble, Kraft Foods, Wrigley and SSL International. 

Aside from international products, Nelt is also distributing domestic products. Nelt is also 

operating in BiH, Montenegro and in Macedonia. The company registered. 

• Delta DMD (~ €125 mln turnover in 2009) is one of the leading distributors in the Serbian 

market and is operating in Serbia and in Montenegro as part of the Delta M Group. 

Meat processing and production 

• Raw meat production is decreasing. Serbia is a net exporter of meat products, but a net 

importer of fresh meat and livestock. Most of the imported meat is processed in local 

processing companies. 

• Major companies in the meat sector are Carnex (over €57 mln turnover of in 2009), 

Matijevic (~ €118 mln turnover in 2009), and Yuhor (active in the market for over a century, 

part of Delta M Group since 2004). 

• Further important companies are Agroziv (especially poultry meat), Industrija Mesa 

Topola; and Topiko (poultry meat producer from Backa Topla which was bought in 2007 by 

the group “Perutnina” from Ptuj, Slovenia); and Neoplanta (from Cenej, a small city in the 

vicinity of Novi Sad. 


Milk processing and production 

• The dairy sector is one of the largest agricultural sub-sectors by value in Serbia with 

revenues of over 350 million EUR in 2008. Annual production of milk 1.7 million litres, 

average milk yield increasing from 1,950 to 2,663 litres (1998-2007). Serbia is a net 

exporter of milk and milk products. Most important export markets are the neighbouring 

countries. 

• Dairies are all privatized, and there are now 36 industrial and 130 private dairies. The 

sub-sectors is dominated by Danube Foods Group (DFG, part of the English investment 

fund Salford) owning 15 dairy plants, including the two largest ones: Imlek (€203 mln 

turnover in 2009) and Suboticka dairy (€69 mln turnover in 2009), covering 47.4 % of 

the Serbian market. 

• The dairy plant Sabac (€46 mln turnover in 2009) is the only dairy plant in Serbia 

completely owned by Serbian shareholders (Farmakom MB). The Somboled dairy plant 

from Sombor (€36 mln turnover in 2009) has a 5.4% market share. The plant has been 

acquired by Croatian dairy company Dukat, owned by the French Lactalis Group. The 

dairy Mlekoprodukt Zrenjanin (€9 mln turnover in 2009) has a market share of 3.9%, 

and is owned by the French firm Bongrain. 

Cereals, flour mills, bakeries, edible oil production 

• Serbia has very favourable climate conditions for agricultural production with 4.2 million 

ha of arable land (of the total of 5 million ha agricultural land). Over the last few years, 

Serbia has established itself as a net exporter of cereals and edible oil. Agricultural 

products are mostly exported to CEFTA countries, EU and Russian Federation. However, 

most of the field crop production is with low yield, significantly below potential. 

• The leader in primary agricultural production is Delta Agrar (part of Delta M Group) 

producing field crop, vegetables, fruit and cattle production. Other larger primary producers 

are PKB (Poljoprivredna Koproracija Beograd), PIK Becej, and Mirotin, Vrbas (trade in 

cereals, and production of cereals, edible oil, milk and milk products). 

• Flour mills: This sub-sector accounts for the largest number of producers in the whole food 

sector. Amongst 25 larger companies, one of the largest ones is Fidelinka from Subotica 

producing and trading cereals, flour and pasta. Other larger flour mills are Zitko, Backa 

Topola (bought by the Serbian company Verano Group), Zitoprodukt, Zrenjanin (flour mill, 

bakery, pasta producer and cereals trader), Danubius, Novi Sad (flour and pasta producer, 

subsidiary of Delta M since 2007), and Kikindski Mlin (flour mill and pasta producer owned 

by Agrokor). 

• The largest bread and bakery producers is the group Klas including Belgrade Bakery 

Industry and Klas company. Second largest bakery is Hleb A.D, Novi Sad. 

• The Serbian oil and fats production is dominated by two major companies: Dijamant, and 

Victoria Oil. 

• Dijamant is the largest edible oil producer and leading producer of margarines, vegetable 

fats, mayonnaise and delicatessen in Serbia. Croatian Agrokor is the major shareholder. 

The company had 112 million EUR in revenues in 2009. 

• Victoria Oil from Sid is part of the Victoria Group and produces raw and refined oils, protein 

meal and biodiesel. The company registered 100 million EUR revenues in 2009. 

• In the sector of animal food production, two companies are in expansion: Sto posto 

(animal food producer and importer of soya cake), and Gebi (specialized in import and 

production of animal food, 35 million EUR turnover in 2009). 


Sugar factories, sugar production 

• Areas under sugar beet are stable (around 60,000 ha) with a production of sugar beet of 2.8 

million tons in 2009. 

• Sugar production is stable at around 430,000 tons. Domestic consumption of sugar 

amounts to 240,000 tons (25-30 kg per capita), exports to 180,000 tons (mostly to the EU 

within the customs-free export quota is 180,000 tons). 

• Major companies are: 

o Sunoko (39.1 % market share, 116 million EUR turnover, major shareholder MK Group; 

Source: InterCapital Securities, 2010). In the last years, Sunoko invested 13 million EUR 

in four sugar plants. 

o Hellenic Sugar Industry S.A. is a major shareholder in the sugar factories Crvenka (76 

million EUR turnover) and Sajkaska (39 million EUR turnover) with a 38.9% of market 

share. 

• Other large sugar plants are TE-TO (17.6% market share, 52 million EUR turnover, owned 

by Italian Finanziaria S.I.I,) and Sugar + (4.4 % market share, 13 million EUR turnover, 

owned by the Montenegrin company Roksped). 

Fruits and vegetable processing and production 

• Fruits: Serbia is the world leader in raspberry production. Other key fruits are apples, 

plums, blackberries and sour cherries (in total around 20 types of fruit). Premium quality of 

berry fruits due to optimal climate and soil conditions (results in a higher dry content). More 

than 300 companies are active in the fruit sub-sector in Serbia. The Serbian Investment 

and Export Promotion Agency (SIEPA) supports a ‘Serbian Fruit’ database of market 

participants (see: www.serbianfood.com). 

• Vegetable: Vegetables are grown on more than 10% of arable land in Serbia. Vegetable 

crop production is characterized by small scale production primarily for individual needs. 

The largest vegetable production centres are Leskovac, Nis, Aleksinac, Kraljevo, Čačak, 

Ub, the vicinity of Belgrade and Horgos, as well as some other places in Vojvodina. The 

total annual production of vegetables adds up to over 2 million tonnes. Potatoes, along with 

peppers and green peas, are the most extensively grown vegetables in Serbia. The 

vegetable processing industry in Serbia includes about 25 companies with capacity for 

production of frozen, canned and dried vegetables. 

• Major companies are: PIK »Juzni Banat« operates with Agromarket d.o.o. Kragujevac as 

a majority shareholder of the company. The core business of the company is in growing 

fruit and grapes on an area of 1830 hectares with strong position in export. The "Lucic 

Group" includes several companies, "Lucic Prigrevica ad", "Kindja Agrar" from Kikinda," 

Panonka "Sombor and a vegetables trade company "Sunfoods" Lucic Group" is the largest 

single producer of vegetables and field crops in Serbia with cold storage capacities of 50 

000 tons as well as a processing and packaging facilities. FRUIT LAND-SERBIA is a 

group of merged cooperatives own modern cold storage plants for storage of their 

products. Mondi Foods is today it is one of the major European processors of red fruit 

products. Production capacity is over 6.000 tons of frozen products per year. 

• Frikom is Serbia´s largest producer and distributor of frozen food – mainly ice cream and 

frozen fruit and vegetables. The company is owned by Croatian Agrokor Group. The 

company had 79 million EUR in revenues in 2009. 

• The joint-stock company food industry A.D. Prehrambena industrija Aleva Novi 

Knezevac, a part of the Flory trading group, is a modern food company with over 160 

types of various products with a turnover of 20 million EUR (out of which 6 million is from 

export). 


Wine / grape production 

• Total wine production in Serbia amounts to ~ 170 million litres. Local consumption is 

dominated by imported wine (third quarters of wine consumed is imported). The low prices 

paid for grapes have resulted in declining production and limited investment in grape 

production and processing. The most dominant wines on the local market are from the 

Macedonian company Tikves and the Montenegrin company Plantaze. 

• Existing privatized wineries (five very large wineries and ten cellars of medium capacity) 

provide most of the country’s current capacity for wine production and grape processing. 

• Wine Zupa is the local market leader with estimated revenues of 56 million in EUR. 

• The company also produces soft beverages and spirits. 

• The company Rubin from Krusevac (owned by the Invej) is the second largest wine 

producer with estimated revenues of 33 million EUR. 

• Smaller companies are NAVIP, producing wine, brandy and other alcoholic drinks, as well 

as soft drinks and juices and the Vrsacki Vinogradi winery involved in growing of wine 

grapes and production of wine from fresh grapes and production of brandies. Several family 

wine producers have positioned themselves in the market as high quality wine producers, 

especially “Winary Radovanovic” and “Winary Aleksandrovic”. 

Beer, mineral water, soft drinks 

Beer: Beer production in 2009 reached 143 million litres. 

• Major beer companies are: Apatinska pivara AD is today the biggest brewery in Serbia. Its 

popular product is Jelen pivo. CVC Capital Partners is the owner of the company. The 

brewery had revenues of 160 million EUR and has invested over 30 million EUR since 

privatization. Carlsberg Serbia with Pivara Celarevo is second in the Serbian beer market 

with estimated revenues of 90 million EUR. Based on market share, further larger breweries 

are Pivara MB (Heineken), Efes Serbia (owner of Pancevo brewery and Zajecar brewery) 

and Beogradska Industrija Piva. 

Soft Drinks: Sales of soft drinks reached 967 million EUR in 2009. 

• Coca-Cola HBC has been operating in Serbia since 1997 investing more than 150 million 

EUR in ten years and is the country's leading soft drinks producer. The revenues from 

CCHBC are estimated at 180 million EUR. Arteska International Company serves the 

alcoholic and beverages market (market brand: Sinalco). Nectar is a leader in production of 

fruit juice drinks and fruit products in Serbia. Company revenues in 2009 were 57 million 

EUR. Fruvita is a Serbian company which deals with fruit processing, juice production. It is 

the largest growing company in the soft beverages subsector in Serbia with estimated 

revenues of 26 million EUR. 

Mineral Water 

• Knjaz Miloš AD (65 million EUR turnover in 2009, owned by DFG) and BB Minaqua AD 

(19 million EUR turnover in 2009) are the largest mineral water producer in Serbia. 

Hot Drinks 

• The largest producers of coffee are Grand Prom (owned by Slovenian Droga Kolinska and 

Doncafe (owned by Israeli Strauss Group). Further significant market shares are taken by 

the Nestle Group and Kraft Foods. 


Confectionary and snacks 

• Confectionary and snacks is a sub-sector with an overall production of 130,000 tons per 

year and increasing importance in the food production in Serbia. The sub-sector achieves 

annual revenues of over 400 million EUR and an export value of 150 million EUR. 

However, the sub-sector is facing severe competition from the region, mostly from Croatia 

as well as from Turkey. 

• Major companies are: Swisslion Takovo, a food and beverages producer producing 

cocoa cream, fruit juices, baby food, biscuits, waffles and chocolates, as well as alcohol 

spirits. Swisslion’s total annual production capacity of confectionery goods amounted to 

60,000 tons. Soko Stark is one of the largest confectionary producers in the region. The 

company is part of Slovenian Droga Kolinska Group. Bambi Banat is one of the oldest 

chocolate and candy producers in Serbia and an integral part of the DFG. The company 

has over 66 million EUR revenues. Pionir is a company with 10% Serbian market share 

and an estimated 43 million in revenues. Jaffa Crvenka produces the most famous brand, 

Jaffa biscuit and the second famous brand Munchmallow. The company registered 24 

million EUR in revenues in 2009. Medela is a Serbian biscuits and waffle producer selling 

in the national market and exports into the region, EU and overseas. The company had 

estimated operating revenues of 23 million EUR in 2009. Marbo product has a broad 

product range of snacks from potato chips to nuts. The company is owned by PepsiCo 

International. In 2009 the company had 54 million EUR in revenues. 

Other food products (niche products) 

• Medicinal and aromatic plants, including wild herbs, forest fruits and wild gourmet 

mushrooms achieve a total value of the industry around 150 million EUR, with 50 million 

EUR export. Serbia is a net exporter protecting its own market by a 30 % ad valorem import 

tariff. There are round 20 organizations in Serbia that bring together over 1,500 collectors, 

growers, and/or processors of herbs, mushrooms and forest fruits. Small sized companies 

usually do the primary processing, grading, threshing, drying, cutting and packing. 

• There are 20-25 larger processors in Serbia active in final processing. The leading 

processors of herbs are Macval (Novi Sad), Melissa (Coka), Fructus (Backa Palanka), 

Aleva (Horgos) and Herba (Belgrade). 

• Among processors of mushrooms and forest fruit, the leading companies are Jurofongo 

(Kursumlija), Interfood (Cacak), Marni (Krusevac) and Foodland (Belgrade). 

• Organic production is established on 15,000 ha. Key organic products are fresh 

raspberries, sour cherries and plums, organic frozen products (strawberries, blackberries, 

apples, and vegetables) and other juice concentrates. There are around 77 registered 

organic producers. Processing of organic production in Serbia is established in specialized 

factories that have relatively small capacities, and in existing fruit processing companies 

such as Nectar or Mondi Serbia. Atle is a highly specialized processor and supplier of 

frozen raspberries and blackberries from Belgrade with an annual sourcing capacity of over 

10,000 tons of soft fruits. The company FOODLAND d.o.o. produces fruit jams, juices, fruit 

wines and butter (brand name “Bakina Tajna”). Golden Falcon is a joint venture company 

of Trading Organic Agriculture from Amsterdam and its Serbian partner Den Juro. The 

factory is the first HACCP operated IQF freezing plant in Serbia. Other companies are 

Zdravo Organic d.o.o. and Royal Eco Food. 


Packaging, machinery and fertilizers 

• Packaging: With the development of the agro-industry in Serbia, the domestic production of 

paper, plastic and tin cans has increased, replacing imported packaging materials. There 

are several portals with a quick access to information about the packaging producers in 

Serbia, such as www.ambalazaipakovanje.com and www.pakovanje.net. Major companies 

are: Tetra Pak Serbia, based in Belgrade with a registered turnover of 141 million EUR in 

2009. Umka, a Serbian company which produces cardboard for packaging. The owner is 

Kappa Star (also owns Jaffa Crvenka and Avala Ada). Umka had registered operating 

revenues of 35 million EUR in 2009. Avala -Ad a , a company producing transport and 

commercial packaging material. The company is owned by Kappa Star Group. Ball 

Packaging from Germany, the first foreign industrial company to set up production facilities 

“on a green-field site” in Serbia. Ball Packaging manufactures aluminium beverage cans. In 

2009, Ball Packaging Europe in Serbia registered 80 million EUR in operating revenues. 

The largest producer of glass packaging is the Serbian Glass Factory AD Paracin, owned 

by the Serbian state-owned gas distributor Srbijagas. 

• Agricultural machinery and equipment is mostly imported (leading importers: 

Agrovojvodina Mehanizacija from Novi Sad, Res Trade, Masferg Agro d.o.o., Almex, 

Gamagro, Agropanonka MTZ Finke). The only two remaining Serbian agricultural 

machinery producers, IMT from Belgrade and IMR from Rakovica, are working below their 

capacities. 


2.2 

Croatia 


2.2.1 Agriculture and Food Industry 

The economic importance of agriculture is still relatively high in Croatia, despite a declining 

trend in the last few years. The same trend can be observed for the food processing industry. 

Both sectors play an important role in the labour market as a significant percentage of the 

population of working age earn their income from agriculture and the food industry. Croatia has 

an unfavourable structure of agricultural holdings, with a lot of small family farms (the official 

average farm size in Croatia is 2.4 ha) and some large agri-businesses. Despite the good 

climate conditions for growing many varieties, the country suffers from deficit in the agri-food 

sector. Croatia is currently self-sufficient in the production of only few products, but a net 

importer of agricultural commodities, also for the food industries. This is because imported 

products, on average, are cheaper than domestically produced food. The situation has been 

worsened by rising competition from regional and EU players, the latter particularly strong in 

exports of cocoa, soybeans, oil crops, breeding cattle, milk, meat, fruit and vegetables to 

Croatia. 

It is likely that once Croatia enters the EU that some of Croatia's food and beverage markets will 

be supplied from other EU countries. Croatia is expected to have difficulties remaining 

competitive in agricultural production. Since a major part of Croatia's food processing industry is 

based on imported raw materials, it could be expected that some of Croatia's processing 

industries will move to the countries of origin of the raw materials. 

The food, beverages and tobacco industry comprises over 1,000 companies, employing some 

45,000 persons or 18.8% of the total number of employees in manufacturing industry. This 

figure has fallen since 2005, although the production of food and beverages is still the leading 

industrial segment in the country. The sector has undergone consolidation in recent years as a 

result of rising competition, from both within and outside the country. 

Nowadays, the main players in the food and beverages sector in Croatia include Agrokor 

Group (~ €3.65 bln turnover in 2009; subsidiaries: Pik Vrbovec, Ledo, Jamnica, Zvijezda etc), 

Vindija, Podravka, Dukat, Braca Pivac, Gavrilovic, Kraš, Kutjevo as well as Coca Cola 

Beverages and Atlantic Group (~ €306 mln turnover in 2009). 


Retail Konzum (Agrokor) 

Mercator (Slovenian) 

Metro (German) 

Wine Kutjevo 

Confectionary Kras d.d. 

Meat PIK Vrbovec d.d. (Agrokor) 

Braća Pivac Holding 

Belje (Agrokor) 

Vrbovec d.d. (Agrokor) 

Koka Varazdin Poultry (Vindija) 

Gavrilovic doo 

Dairy Industry Dukat Dairy Industries dd (Lactalis, French) 

Mills 

PIK Vincovci (Agrokor), cereals, sunflower, soybeans 

PKK Valpovo, cereals, milling, bakery, meat 

Zito d.o.o. (Zito group), cereals, animal feed, meat 

Beer Zagrebacka Pivovara (CVC Capital Partners) 

Karlovacka Brewery (Heiniken) 

Water Jamnica (Agrokor) 

Soft drinks Coca Cola HBC Hrvatska 

Hot Drinks Franck (coffee, tea) 

Fish Adria, Sardina, Cromaris 


2.2.2 SWOT Analysis 

Croatia’s potential in the food sector lies mainly in increasing productivity and competitiveness 

with the help of new technologies, alongside a continuing merger and acquisitions process, 

especially amongst the larger companies who have already expanded their network into the 

neighbouring countries. These large companies/holdings will try to further grow to strengthen 

their position in the market to avoid being taken over by multinationals/EU companies. The 

vertically integrated approach (e.g. of Agrokor) of production, processing and retailing could 

guarantee the market position. Others like Gavrilovic follow a different integrated approach, 

including fast food restaurant into their portfolio. Also companies like Atlantic Group have 

strengthened their position by diversification and expansion. A challenge for the processing 

companies will be the loss of the CEFTA preferences, especially when it comes to export to 

BiH, one of the important export markets of Croatian companies. The Croatian government is 

currently trying within the framework of EU negotiations to get a special agreement with the EU 

concerning the BiH market. 

Strengths, Weaknesses, Opportunities, Threats (SWOT) include the following: 


• Food sector is the main sector (20%) 

within the Croatian processing industry 

• Large holdings/companies with 

expansion into neighbouring countries 

• Growth process in the sector responding 

to retail development 

• Relatively weak agricultural production 

• Still large numbers of smaller processing 

companies 

• Significant modernisation required to 

comply with EU standards and productivity 

• Production costs are relatively high, 

resulting in high product prices 

• Dependence on raw material imports 

• Low share of EU markets 


• Croatia is supposed to become an EU 

member already by 2012/2013, thus 

facilitating access to the EU market, and 

becoming eligible for EU structural funds 

soon 

• High quality of certain products 

• Rising foreign investments 

• Domestic market interesting (local 

demand plus increasing tourism) 

• High levels of unemployment (16%) 

• Price-conscious consumers (purchasing 

power higher than in other CEFTA 

countries, but still lower than in the EU) 

• Competition from EU countries 

• Loss of CEFTA preferences upon entering 

the EU 

2.2.3 Interesting sub- sectors and larger companies 


• In 2009, the total 54 enterprises in the business of retail had a turnover of ~3.9 billion EUR 

billion – by 1.2 per cent smaller than in 2008. In general, decreasing disposable incomes 

made consumers re-think their purchasing habits in 2009. 

• Loyalty to well-known, traditional brands are more and more competing with private labels, 

although private labels are produced often by the same (brand) producers. 

• The domestic private company Konzum (Agrokor) dominates the retail sector in Croatia. 

Konzum holds a 30% share of the total market, up to 40% of the market in the capital 

Zagreb. 


• For 2010 it is reported that the market relevance of the retail companies has changed: 

Konzum, still the market leader (turnover in 2009 ~ €1.74 bln), is followed by Kaufland 

(turnover in 2009 ~ €279 mln), Plodine (turnover in 2009 ~ €310 mln), Lidl and Billa 

(turnover in 2009 ~ €217 mln). The company SPAR is not anymore among the TOP 10 

retailers in Croatia and was replaced by DIONA. 

• The Croatian retail market actually has only one genuine discounter chain – Lidl, and this 

chain first appeared as late as 2006. Changes in disposable income attracted more 

consumer groups to this discounter resulting in a very strong growth since 2009. 

• In the Cash&Carry segment, German Me tro (turnover in 2009 ~ €325 mln) and Getro, now 

owned by the Slovenian company Mercator, (turnover in 2009 ~ €238 mln) are the main 

players. 


• In the livestock sector, small production units predominate, especially for cattle, pig, sheep, 

and goat. Poultry production on the other hand is characterised by large-scale production 

units (for poultry meat and eggs). The deficit in external trade with fresh and processed 

meat sums up to ~ €124 mln: imports (mainly from EU countries, in particular pork meat and 

sausages) amounted to ~ €187 mln, exports (mainly to other Balkan states such as BiH) 

amounted to ~ €63 mln in 2009. 

• There are 196 slaughterhouses in Croatia. A number of slaughterhouses are of 

international standard and 12 have exporting licenses for the EU and US markets. However, 

many municipal slaughterhouses will have to upgrade their standards or be closed, due to 

non-compliance with EU regulations. The same applies to smaller meat processing 

companies. 

• Although the larger processing companies in Croatia fully meet the EU hygiene standards 

and process products of good quality, competition will arise from higher productivity and 

lower pricing of EU competitors. Therefore investments in the meat processing sector are 

especially anticipated in the field of productivity and expansion/acquisition. 

• Main players in meat processing are 

o Agrokor holding with its subsidiaries Belje (turnover 2009 ~ €180 mln), 

Pik Vrbovec (turnover 2009 ~ €211 mln), Vupik (turnover 2009 ~ €25 mln); 

o Vindija holding with its subsidiaries Koka (turnover 2009 ~ €179 mln) and Vindom 

(turnover 2009 ~ €21 mln), market leaders in poultry meat processing; 

o Family owned holding Gavrilovic (turnover 2009 ~ €74 mln) 

o Family owned Braca Pivac (turnover 2009 ~ €175 mln) 

o Podravka with the brands ‘Podravka’ and ‘Danica’ (turnover 2009 ~ €60 mln). 


• Milk production reached 814 mln litres in 2009. The percentage of milk production that is 

being processed by the dairy industry in Croatia grew from 65% in 2000 to over 80% in 

2009. 

• Croatia is still a net importer of milk and dairy products. Total imports in 2007 were 150.000 

tons (~ €77 mln), with the highest share of it being cheese, fermented products and milk. 

Total exports amounted to 106.000 tons (~ €40 mln). In 2009 milk purchase prices at farm 

gate were significantly higher in Croatia than in the EU. 

• The quality of milk is determined according to the regulation on the quality of fresh milk. The 

regulation is completely harmonized with the EU regulations. 

• In the Croatian milk industry there are 37 registered dairies, with the largest two (Dukat and 

Vindija) processing more than 2/3 of total quantities of processed milk. Dukat (turnover 

2009 ~€ 245 mln) and Vindija (turnover 2009 ~ €391 mln) have been continuously 

increasing their turnover in the past years, and have become important regional players with 

growing export figures and acquisitions in the neighbouring countries 


• The medium segment of the market is far behind the leaders in terms of turnover: the 

closest competitor is Meggle (turnover 2009 ~ €40 mln). 

Cereals, flour mills, bakeries, edible oil production 

• Cereals dominate crop production in Croatia, accounting for about 65% of total arable land. 

Maize (55% of production, 1.4 million tons produced in 2007) and wheat (812,300 tons in 

2007) are the most important commodities in this sector. For both maize and wheat the 

country is self-sufficient. As Croatia prepares to enter the European Union, Croatian farmers 

will need to become more competitive in order to compete with European producers. 

Croatian farms tend to be smaller and less technologically advanced than many other EU 

countries, which lessens their competitiveness. 

• The majority of the companies in the sub-sectors cereals, milling, oil seed, animal feed and 

bakery belong to Agrokor holding or the Osijek based company Zito. 

• Pik Vinkovci, and Belje are large agriculture holdings with own production and processing, 

also supplying Argokor’s animal feed processor Agrokor Trgovina. Agrokor’s Zvijedza 

(turnover in 2009 ~ € 130 mln) is market leader in margarine and dibble oil. 

• PKK Valpovo, is a large agricultural holding in hand of Zito d.o.o (turnover 2009 ~ €178 

mln). 

• In bakery Agrokor is also dominating the production, especially via the bakery Zagrebacke 

Pekarne. An important player in bakery is Mlinar (turnover 2009 ~ €37 mln), a subsidiary of 

the Skojo Group. 


• Sugar beet production takes place on around 30,000 ha in Croatia. Local refineries, 

including Viro, Slardorana, and Kandit, are working on domestic production and supplying 

other markets including Bosnia and Herzegovina, Montenegro, FYR Macedonia, and 

Albania and the EU. 

• Viro Tvornica Secera, the leading company with a turnover of ~ €80 mln in 2009, has 

increased its export quota to EU by purchasing Sladorana in 2008 to 120,000 tons annually 

(total Croatian export quota 180,000 tons), but still the domestic market accounts for 50% of 

the sales. 

• Kandit was a prominent sugar and candy factory in former Yugoslavia. Today, the Kandit 

group comprises IPK Kandit Inc. for the production of candies and chocolates and the 

Kandit Premijer Ltd. sugar factory (turnover 2009 ~ € 60 mln), now both in hand of Zito in 

cooperation with other investors. 


• In the fruits and & vegetables sector (including grapes), production is characterised by 

small scale farmers producing primarily for self consumption and direct marketing. Grapes 

(table and wine grapes) and potatoes are the most important commodities followed by 

apples, plums and tomatoes. 

• Processing companies (beside Podravka) depend also on import of raw material since 

the local production does not provide sufficient quantities for processing. The problems 

many smaller processors faced in the past was related to utilisation of their capacities due 

to insufficient raw material supplies resulting in financial problems not allowing any 

modernisation of the facilities. In the last years a number of processors disappeared from 

the market or were absorbed by the larger processors. 

• Most important company in fruit and vegetable processing is Podravka with its brands 

Prodravka, Vegeta and the newly purchased brand ‘SMS’. Ledo (turnover in 2009 ~ €162 

mln), the Agrokor company specialised on deep frozen products, supplies the 

supermarkets with ice cream, ready meals, fish and fruit & vegetables, all deep frozen. 

Traditional canning is still done by Eurovoce Zadruga (turnover in 2009 ~ €9 mln), a 

cooperative in the north-eastern part of Croatia. 



• Total wine production is estimated at about 100 mln litres. Croatia is a traditional producer 

of wine, with around 300 geographically-defined wine-making regions within the country. 

Most production already complies with international and EU standards. Most of producers 

are located in the county of Split-Dalmatia. Most of vineyards are family farms with an 

average vineyard size of less than 1 ha. 

• Domestic wine is expensive in comparison to imports from the EU due to lower productivity. 

With increasing competition expected after EU accession a significant drop of prices is 

expected. Domestic consumption of wine has been declining in recent years, as younger 

consumers increase their preference for cocktail-style drinks. With EU accession it is 

expected that the modern wine processors will keep its market share while a number of 

smaller producers will face problems with regard to quality and quantities and productivity. 

• The largest wine producer is Badel 1862 (turnover in 2009 ~ €58 mln), producing wine and 

spirits. A further large winery is Kutjevo (turnover in 2009 ~ €47 mln) based in the wine 

region of Kutjevo. Agrokor Vina was founded in late 2009 and envisioned as a regional 

leader in the wine industry. Agrokor Vina is responsible for marketing, sales and 

development of seven wineries (Croatia: Agrolaguna, Belje Cellars, Ilok Cellars, Mladina, 

Istravino, Novigrad Winery; Macedonia: Valandovo Winery). With its partner wineries, 

Agrokor Vina holds a 31% market share in the Croatian wine market. 

• The leading private wine makers in Croatia are Vlado Krauthaker from Kutjevo and the 

producer Zlatan Otok from island of Hvar with significant domestic and exports potential. 


• Beer: In the beer sector, key companies include Zagrebacka pivovara (ZAPI): (turnover in 

2009 ~ €116 mln, market share 42%), Belgian Heineken (owner of Karlovacka Brewery, ~ 

€92 mln, market share 27%) and Danish Carlsberg: (turnover in 2009 ~ €50 mln, market 

share 18%). 

• Soft drinks: Croatia’s bottled water market consumption reached 406.5 mln litres (2007), or 

almost 90 litres per person, among the highest in the region. Sparkling water holds a market 

share of over 57%, but has been losing markets share to still water in the past few years. 

Main brands are Jamnica (Agrokor): turnover ~ €143 in 2009 and Studena (Podravka). 

The soft drink market is dominated by Coca Cola, turnover ~€136 mln (2009). 

• In hot drinks the Croatian company Franck (turnover in 2009 ~ € 96) is the number one 

brand for coffee. 

Confectionary, sweets, ice cream 

• Key players in the Croatian confectionery market include primarily local companies, led by 

Kraš (which holds with a turnover in 2009 of ~€ 130 mln over one-third of the market) and 

IPK Kandit (turnover in 2009 ~ € 25 mln). 

• The limitations of the small market are increasingly forcing Kraš and other local players to 

look for opportunities abroad and beyond the region. 

• A steady increase in confectionary imports into Croatia is reported. The usual mix of 

multinational brands is present in the Croatian market, e.g. Ferrero with a turnover of more 

than € 69 mln, followed by Nes tle and Krafts , both present in various sub-sectors in the 

food market. 


Fish 

• Croatia’s lengthy Adriatic coastline creates a significant amount of opportunity for the 

country to become a leading exporter of fish and seafood, but the fishing industry is beset 

by difficulties. The global financial crisis has threatened Croatia’s fishing industry and 

hindered Croatian fish and seafood production. 

• In marine aquaculture, Croatia produces vast quantities of a limited number of species. 

Ten years ago Croatia began developing tuna farming for export to Japan. Freshwater 

aquaculture production in Croatia has been increasing and now totals between 4,000 to 

6,000 MT annually. Here, most important farmed species are carp and trout. There are 

about 40 companies registered in Croatia for freshwater farming, and many plan to link 

freshwater farming with rural tourism. 

• Croatia imports a significant quantity of fish and seafood products. Croatia’s seafood 

imports increased to USD102 million in 2009, mostly coming from Spain, Italy, the Falkland 

Islands, Norway, and Sweden. 

• Main processing companies are Ad ria in Zadar (turnover in 2009 ~ €22 mln), Sardina 

(turnover in 2009 ~ €23 mln) and the newly established company Cromaris , a merger of 

three fish processing companies in Zadar. Cromaris is member of the Adris Group. 


2.3 Bosnia and Herzegovina 



The total area of BiH is covered with approximately half forest, and half agricultural land (of 

which about half pasture, half arable land). Part of the arable land remains uncultivated 

(approximately 44%). On the cultivated land, mostly wheat and maize and other cereals 

(together 56%) are harvested, whilst vegetables represent about 13% of harvested area and 

potatoes 7%. The production mostly takes place in small-scale farms, with relatively low 

productivity. 

Agri-food exports amounted to 0.2 billion EUR in 2008, 70% of which was exported to the 

Western Balkans. Agricultural imports amount to more than 1.3 billion EUR in 2008, leaving an 

extremely negative agri-food net trade balance of more than 1 billion EUR, i.e. BiH is a strong 

net-importer of food. Import duties for most of food products are close to zero, and the few 

remaining import duties will be further decreased in the scope of the Association and 

Stabilisation Agreement and the CEFTA agreement. 

Overall, BiH is still at an early stage of approximation with the EU acquis communautaire in the 

fields of agriculture and rural development, food safety, veterinary and phytosanitary policy, and 

fisheries. The strengthening of state-level capacities in the field of agriculture continues to be 

necessary, and preparations to setting up structures to implement IPARD needs to be 

intensified. 

There is one strong local holding in Bosnia and Herzegovina, the MIMS Gro up , which is now 

one of the largest privately owned companies in BiH, employing over 5000 people. MIMS Group 

was founded about 10 years ago as a wholesale company for food products, construction 

material and household items. It now has a variety of company members such as Me rku r 

(retail), Klas and Sprind (mill and bakery), Sarajevo and Tuzla Breweries, and Vegafruit. 

Further, larger companies from the region are also quite dominant on the market such as 

Agrokor (Croatia), Me rcator (Slovenia), and Danube Food Groups (DFG). 


Retail & Wholesale Konzum (Agrokor, Croatia) 

Bingo 

Mercator (Slovenia) 

Merkur (MIMS Group) 

Podravka (distributor, Croatia) 

Bakeries Klas (MIMS Group) 

Sprind (MIMS Group) 

Bottled Water, other beverages Sarajevska Kiseljak (Agrokor) 

Jamnica (Agrokor) 

Vitinka 

Coca Cola 

Beer Sarajevo Brewery (MIMS Group) 

Banja Luka Brewery AD 

Tuzla Brewery (MIMS Group) 

Meat Lijanovici 

Akova Impex Sarajevo 

Menprom 

Edible Oil BIMAL (Studen and co, Austria) 

Wine Hercegovina Vino/Citluk Winery 

Podrum Andrija 

Milk Meggle Eastern Europe (German) 

Mlekara Kozarksa Dubica (DFG) 

Sarajevska Milkos Dairy (Teloptic) 

Tuzlanska Dairy (Ljubljanska D.) 

F&V Vitaminka, Vegafruit (MIMS Group), Marinada (MIMS) 

Niche products Norfish 




• Domestic market / knowledge of local 

consumer behaviour 

• Connection to Bosnian diaspora 

• Sufficient quality water 

(for beverages) 

• Favourable conditions for fruit and 

vegetable, and cattle breeding 

production 

• Larger companies have introduced 

quality management systems (HACCP, 

ISO) 

• BiH is a strong net importer of food 

products 

• Fragmented primary production, quantities 

are limited 

• Small size of processing companies (aside 

from some exceptions) 

• Obstacles to exports (e.g. expensive 

laboratory services, administrative 

difficulties) 

• Smaller sized companies have difficulties in 

fulfilling growing quality management 

requirements 


• Domestic market (3.8 mln population; 

import substitution) 

• Growing export of berries and other fruits 

(export to the region and to the EU) 

• Duty-free access to the EU market for 

most products 

• CEFTA member 

• Strong market dominance of foreign brands 

/ imported products (since the 1990s) 

• Low purchasing power of the local 

population 

• Depopulation in rural areas, leading in part 

to shortages of labour 


Retail and Wholesale 

• The number of supermarkets and hypermarkets in Bosnia has significantly increased over 

the last years. Retail chains of foreign ownership (Slovenian, Croatian) are present. 

• Konzum (Agrokor, Croatia) is the leading retailer in BiH (~ €235 mln turnover in 2009) . 

• Bingo (local company) is the second largest retailer (~ €146 mln turnover in 2009). 

• Other retailers are Mercator and Tus (Slovenia), Interex (French), Tempo and Maxi 

supermarkets (Delta M., Serbia), 

• Smaller players are Me rku r (MIMS Group) and Amko Commerce. 


• Due to the high share of grasslands in total agricultural land, livestock production is 

important for BiH. Halved during the war, livestock have been gradually renewing. The 

years 2000-2008 are characterised by constant increases in production of almost all 

livestock products (milk production +37%, meat production +16.3%). However, BiH is still a 

net importer of meat. BiH has tradition in lamb meat and baby beef production as well as in 

processing of meat (in particular dried and smoked meat). There are more than 30 meat 

processing companies in BiH, but most are small-scale. The annual capacity of the 11 

largest companies is approximately 60,000 MT, but only around 50-55% is utilised. 

• Market leaders are Akova Impex d.o.o., Sarajevo (~ €49 mln turnover, 2009), Lijanovici 

d.o.o., Siroki Brijeg, and Menprom, Tuzla. All have HACCP and ISO certification, Akova 

Group also has a Halal certificate and Menprom an ISO 22000-2005 certificate. Other 

companies are smaller (e.g. Brajlovic, Stanic, Bro jler, La Vita, Brovis , etc.). Market 

leader in egg production is Posavina koka. 



• Production of cows’ milk (whole, fresh): ~750,000 MT (FAOSTAT 2007). About one-third of 

the milk is delivered to dairies. Average productivity: 2,559 kg/cow and year 

• There are about 100 dairies in BiH, with a total capacity of ~2 mln litres/day. Only about 

one third of that capacity is used. Approximately 45 dairies exceed capacity of 1,000 

litres/day and 10 exceed capacity of 100,000 litres/day. The dairies produce mainly highvolume, 

fast-turnover, low margin products like fluid milk and only a few dairies produce 

value-added products like aged cheese. As a result, most value-added milk products are 

imported from neighbouring countries or the EU. 

• Market leaders are Kozarska Dubica Dairy (Mlijeko product) (~€31 mln turnover, 2009), 

Meggle Eastern Europe GmbH (~€20 mln turnover, 2009), Sarajevo Dairy (Milkos) (~€9 

mln turnover, 2009), Banja Luka Dairy and Tuzla Dairy. The companies have HACCP 

and ISO, and some also Halal certificates. 

• In 2008, three dairies in Bosnia, the dairy Banja Luka, EAS TMILK and Mlijekoprodukt 

began operational integration with Imlek group (DFG, Salford Capital). 

Bakeries, flour mills and edible oil production 

• Maize production: ~962,000 tons, wheat production: ~ 255,000 tons (BHAS, 2009). 

• Market leaders (flour mills/bakeries) are Klas (~ €57mln turnover, 2009) and Sprind 

(~€57mln turnover, 2009), both belonging to MIMS Group. Further there are a number of 

small and medium sized companies. 

• BIMAL, Brcko, is BiH’s sole edible oil producing company that has crushing, refining and 

bottling capacities. (~ €49 mln turnover, 2009) 


• From 1996 until recently, sugar beets have no longer been produced. However, it seems 

that sugar beet production has been restarted in around Bijeljina. 

• BiH still has some unused customs-free quota for export to EU. 

• Studen in cooperation with Agrana, Austria have built a sugar refinery in Brcko, BIH: 

Studen-Agrana Rafinerija Secera, but is only refining sugar based on imported semiprocessed 

products 

• After 18 years of stand still, the sugar plant of Fabrika secera in Bijeljina started operating 

again on November 4, 2010. The plant has a daily processing capacity of 4,000 tons of 

sugar beet and production of 500 tons of sugar. 

Fruits and Vegetable processing and production 

• Production of vegetables: in total ~490,000 tons on 32-38,000 ha; Potatoes: ~ 414,000 

tons 

• Production of fruits: Plums: ~ 156,000 tons, Apples: ~ 71,000 tons, Pears: ~ 25,000 tons. 

• Industrial processing of fruit in BiH involves mainly drying and production of fruit juices (or 

concentrates) and jams. However, there are frequent fruit shortages for some fruit 

varieties. About one third of fruit juices are imported, as local production cannot meet the 

local demand. 

• There are approximately 20 fruit and vegetable processors in BiH,. The two largest 

companies, Vitaminka, Banja Luka (~ €14mln turnover, 2009) and Vegafruit (MIMS 

Group) (~ €14mln turnover, 2009) export part of their production. Other companies are 

small to medium-sized (Mladegs PAK, Vegic commerce, Fruktona, Sava, Berry Dreams, 

Bajric Ltd.) 



• Wine production amounts to about 25 mln litres in 2009. BiH is a net importer of wine, with 

wine from FYR Macedonia and from Montenegro often being cheaper than the local wine. 

• Wine export mainly through wineries Herzegovina Vino & Citluk Winery (market leader, 

400 ha vineyard, winery with 100,000 hl capacity) and Podrum Andrija. Hepok wineries 

(different locations) were privatised recently. Other smaller wineries are, for example 

Podrum Ostojic, Vukoje, Tvrdos, Stolac Winerey, Doanovici Winery. 


• Beer: Local production covers about 65% of the domestic market. Majority of beer imports 

come from Serbia and Croatia. Market leaders are Sarajevo Brewery (~ €39 mln turnover, 

2009, owned by MIMS Group), Banja Luka Brewery (~€11 mln turnover, 2009) and Tuzla 

Brewery (~ €8 mln turnover, 2009, owned by MIMS Group). Others are the Bihac 

Brewery and Grude Brewery. The five local breweries cover estimated 64% of the 

domestic market, the rest of beer being imported. 

• Soft drinks: 350 million litres sales of soft drinks / year, of which about half bottled water. 

Still and functional bottled water are fast growing categories. Sales of bottled water 

outperformed those of soft drinks overall within Bosnia-Herzegovina during 2009 in both 

value and volume terms. Market leader for soft drinks is Coca Cola HBC B-H (market 

leader soft drinks, ~€ 61 mln turnover, 2009) 

• Bottled water: Sarajevski Kiseljak (Agrokor) is market leader for bottled water (~ €35 mln 

turnover, 2009) followed by Vitinka (~€11 mln turnover, 2009). Other companies producing 

bottled water are Sarajevo Brewery, Ilidzanski Dijamant, Oase, Planinski Biser and Leda. 

Despite having good resources of water, BiH is still a net importer, with imports mainly 

coming from Croatia (e.g. Jamnica) and from Slovenia. 

Confectionary / snacks / pastry etc. 

• Until 2008 strong growth in sales of confectionary and snacks. Since the global financial 

crisis, consumers look again more for basic food stuff and products at discount prices. 

Sales of confectioneries amounted to 15,500 tons (2009). 

• Companies from the region (in particular from Slovenia, Croatia, and Serbia) are dominant 

in the market. 

• VISPAK, Visoko is a local company producing coffee, chocolate, snacks etc. The turnover 

was €10 million in 2008. Furthermore, Vitaminka a.d., Banja Luka also produces 

confectionary and snacks (in addition to processing fruits and vegetables). Other 

companies producing chocolates, ice cream and/or snacks are, for example Lasta, 

Barpeh, Emmesse, and Eurovip. 


Fish: 

• Larger companies are Norfish Blagaj (a Bosnian-Norwegian company near Mostar with 

processing facilities), Tropic, Banja Luka, and Riz Krajina. Quota for customs free export 

to EU (2010): 60 tons processed fish. 

Others 

• Other productions are honey, aromatic and medicinal plants, herbs, and mushrooms, but 

mostly at small scale. 

• Companies producing essential oils and herbs are, for example Roing, Ljubuski, and 

Andjelvic, Trebinje. The company Pharmamed produces medicinal herbs and teas. 


2.4 Moldova 



In the Republic of Moldova, agriculture has traditionally been regarded as the cornerstone of the 

national economy: agricultural output accounts for 15% of GDP and together with the 

processing industry represents over 30% of GDP and approximately 60% of total exports. At the 

same time, agriculture constitutes the most important sector of the national economy, using over 

35% of the country’s labour force. Although a free trade agreement has been negotiated with 

the EU, the country’s main trading partners remain Ukraine, Russia and Romania. 

Although the climate is relatively favourable to agriculture, the country is experiencing 

increasingly harsh agricultural seasons and drought periods (the last occurred in 2007), 

resulting in severe losses of crops. Privatisation has created a dual structure of farms with about 

half of the private land in hand of 300,000 smaller, individual farms averaging 1.9 hectares. 

Most of these small farmers do not have the resources to purchase improved 

inputs/technologies and therefore add value to their production; however, some farmers have 

increased their farm size by forming associations or by leasing or buying land. The other half of 

the privately owned land is managed by about 1,500 large-scale corporate farms that average 

around 650 hectares, cultivating extensive crops like sugar beets, wheat, and sunflowers that 

require less labour, but more land and machinery. 

The food industry accounts for 60% of the total exports of Moldova through three major sectors: 

(i) a strong wine industry; (ii) a stable and promising horticultural production and processing 

industry and (iii) a less important dairy and meat industry. 


Retail & Wholesale Nr. 1 (Moldovan) 

Greenhills Nisku (Ukrainian) 

Fourchette (Ukrainian) 

Metro Cash&Carry (German) 

Fidesco (British) 

Wine Grikova (state) 

Milesti Micic (state) 

Acorex Wine Holding (Russian) 

DK Intertrade (Dionys) 

Chateau Varteley 

Others (Bostovan, Hincesti, Pucari, etc.) 

Sugar industry JSC Südzucker Moldova (German) 

MARR Sugar Moldova (Russ.-Mold.) 

Fruits and vegetables Natura Bravo (Russian) 

Orhei-Vit 

Alfa Nistru 

Tymark (Polish) 

Beer, Soft Drinks, Water Efes Breweries International 

Coca Cola 

Risan (Russian, German, Mold.) 

Meat Bacarabia Nord 

Carmez International (Belgian-Mold.) 

Milk Incomla 

Vegetable oil; nuts oil Florea Soareluj 

Violika (oil from nuts) 

Cereals / Mill JCC Seminte Nord 

Kelly Grains 

Sweets / Pastry Bucuria 

Franzelura 

Neffis 




• Food sector is main sector (43%) 

within the Moldova processing industry 

• A number of large holdings/companies 

with FDI 

• Good climate for agriculture 

• Low labour costs 

• Fragmented agriculture production 

• Still large number of smaller companies 

• Significant modernisation required to comply 

with EU standards/productivity 

• Lack of labour force 

• Not yet in compliance with EU Food safety 

standards 


• Opportunities to diversify export 

destinations, e.g. for wine 

• Opportunities for fruit and vegetables 

• Investment opportunities in primary 

production incl. organic farming, food 

processing, input supply, and 

agricultural finances 

• Opportunities in equipment for 

irrigation, packaging and processing 

• Political stability (or political influence on 

trade) with regard to parliamentary elections 

in 11/2010, 

• Instability of government policies or political 

influence on trade, political problems with 

Russia affecting Russia as important export 

market, or with Romania as export market 

• Separatist regime in Moldova's Transnistria 

region. 

• Scepticism of foreign investors 

• Low efficiency of government due to 

bureaucracy and government instability, 

corruption 

• Local currency less devaluated than 

currencies of competing countries 

• Local infrastructure incl. roads, electricity, gas 

and water supplies 

• Agricultural weather, e.g. droughts 



• There are over 100 supermarkets (>2,500 square meters of commercial area) in Moldova, 

the majority are concentrated at larger places. The majority of supermarkets buy their fresh 

products locally as well as from imports. Local producers often do not meet the supply 

schedules, packaging standards required by the supermarkets. 

• According to some distributors’ calculations, about 10-20% of the Moldovan population 

buys their groceries in supermarkets, depending on the size of the towns and the presence 

of supermarkets. 

• Major supermarket chains in Moldova are Furchet, Green Hills, N1, Fidesco, Metro Cash 

& Carry, Cvin, Linella, and Everest. 


• The meat processing sub-sector in Moldova is represented by 17 large enterprises with a 

total value of sales in 2008 of €63 mln. This comprises about 67% of sales of the entire 

sector. The value of the total processing and preserving of meat and meat products in 2008 

was estimated at €94 mln, or 5.1% of the total industry of the country. 


• The meat processing sub-sector in Moldova is represented by 17 enterprises with a total 

value of sales in 2010 of USD 82.8 mln. Two meat processing companies control 80% of 

the local meat market. Carmez is the largest meat processing company in Moldova with 

around 1,000 employees and a broad product range. The main markets are Moldova and 

CIS countries. Basarabia Nord JSC is one of the most important salami and sausage 

producers in Moldova. The company has more than 500 employees and a wide range of 

products, e.g. more 150 types of salami. 


• The dairy products industry accounts for 5 % of the entire food processing industry and 

12% of the food product and beverage industry. The milk production in Moldova derives 

mainly from small farms and households. Milk productivity varies by regions but ranges 

between 4,252 and 1,260 litters per cow. The annual production of milk in 2009 was 

543,000 tons. Some of the milk producers formed milk collecting cooperatives. One of the 

biggest ones is located in the Rezina region and involves 410 members. 

• With regards to the production data in the dairy sector available milk is sufficient for the 

domestic demand, although processed products are still imported. Imports of milk and dairy 

(mainly cheese and curd) products are mainly coming from Russia and Ukraine. Moldova is 

a net exporter of powdered milk, with exports directed towards Russia. 

• Milk processing is done by 12 companies processing about 25% of the total milk 

production. The rest of the milk is locally consumed by households (as fresh or homemade 

cottage cheese) or sold in local farmers markets. 

• In the milk sector, four milk processing plants (JLC JSC, Lactalis, Incomplac and 

LapMol) control 80% of the internal dairy market whereas Incomplac controls 45% of the 

internal market and produces 50% of the total powder milk in the country. 


• Cereal production has a vital importance to the country. The main crops cultivated in 

Moldova include wheat, barley, corn etc. The land area under cultivation with cereals was 

~1 mln ha in 2008. Moldova's wheat harvest totalled some 772,000 tons in 2010. 

• Flour mills are in private ownership: out of 150 mills there are only 3 with state 

participation. The total production capacity of the flour-milling industry is circa 40-43,000 

tons per month. The value of the flour milling industry including starch production was 

estimated at €14 mln in 2008 (0.8% for the total industry). 

• Oilseed production and processing: The main oleaginous plants in Moldova are sunflower, 

soy and rape. The overall volume of these plants in 2008 totalled 430,000 tons. 

Important companies are Trans Oil Group, WJ Moldova Group, JSC Seminte Nord, 

KELLEY GRAINS IMPEX LLC, FLOAREA SOARELUI JSC 

• Bakeries: Bread is mainly produced by the private sector and rural households. There are 

232 bakeries registered in the country processing 500-520 tons of flour daily. 48 

enterprises are manufacturing bread and pastry products in 2008 to a value of €40 mln. 

Important companies are FRANZELUTA JSC, NEFIS LLC, UPTORUL FERMECAT LLC. 


• Sugar has a strategic importance in the national economy in Moldova. In 2008, the area 

planted with sugar beet was 24,700 ha in size, producing 960,000 tonnes of sugar beet. 

• Currently, sugar beet in Moldova is processed by two companies: JSC “Südzucker 

Moldova” (incorporating the sugar factories from Drochia, Făleşti, Alexăndreni and 

Donduşeni) and “Marr Sugar Moldova” LTD (incorporating the sugar factories from 

Cupcini, Glodeni and Ghindeşti). 



• Fruit production has varied from approximately 200,000 tons to 400,000 tons on an 

annual basis. According to private sources (fruit traders, exporters) Moldovan production of 

fruit increased to approximately 1 mln tons p.a.; a result of new technology, farm 

management and irrigation schemes. Apples are the largest fruit crop in Moldova (60% of 

fruit production). 

• Vegetable production consists mainly of open-field vegetables with a production area of 

45,000 ha with total production of ~ 393,000 tons. About 7,270 tons of vegetables were 

produced in greenhouses in 2009. 

• Fruit and Vegetable processing: There are some 50 horticultural processing plants 

(including dried fruits and herbs and excluding wineries) most of which work below the 

installed capacity (15-25%). Most of the larger processing companies are equipped with 

modern equipment imported from the EU. The value of the processing industry in 2008 was 

€74 mln and accounts for almost ten percent of the total value of the food industry (€755 

mln). 

• Six companies (Orhei-Vit, Alfa-Nistru, Natur-Vit, Natur Bravo, Rozmiar, Cosnita, 

Floresti) export the bulk of apple juice, preserved cucumber, canned peas and juice/whole 

tomatoes. The product range is diverse: natural juices (clarified and with pulp), nectars, 

fruit. More than 90% of production is destined for export. CIS remains the biggest market 

for exported fruit and vegetable products, accounting for 70% in total including Russia 

(38%) and Ukraine (9%). EU-27 and other European countries account for the other 30% 

of exports, mostly in the form of semi-finished products. 


• A very promising agribusiness sector in Moldova is wine production and processing. 96.5% 

of Moldova’s vineyards are privately owned. The current annual volume is around 400,000 

tons. In 2008, there are 158,000 ha of vineyards in Moldova: 86% are cultivated with 

technical varieties and 14 % with table grapes. Annually, Moldova produces about 200-300 

million bottles of wine, 20 million bottles of sparkling wines, and has a production potential 

of up to 1.0 bln of bottles per year. The majority of the wine is exported to Russia and other 

Eastern countries. 

• In 2008, 112 larger wineries were licensed. Furthermore, there are 75 wine bottling lines at 

63 enterprises. 24% of the wine companies own their own plantations. It is estimated that 

Moldovan wineries produce about 140-160 mln litres (2008) of still wine a year, and about 

7.27 million litres of sparkling wines (plus production of brandy). 

• Larger wineries are Acorex (leader in premium wines as well as quality commercial wines), 

Chateau Vartely (medium-sized winery specialises in premium wines), Cricova Winery 

(famous for its unique underground labyrinths and excellent wines, being one of only three 

underground wine cellars in the world that are protected by UNESCO), 'DK-Intertrade' 

(part of the Alcoholic Holding Company 'Dionis Club', a leading producer and exporter of 

the Moldavian wines), Dionysos-Mereni (first winery in Moldova to receive ISO 9001:2000 

certification), LionGri (with about 1000 hectares of top vineyard in the best grape growing 

regions), and Milestii Mici (established in 1969 as a facility for storage and maturing of 

high quality wines, with wine cellars, created in the galleries of a disused limestone quarry 

40-85 metres deep rate as the largest in the world), Vinaria BostaVan and Purcari 

Winery. 



• The value of the production of mineral water and freshener beverages was €21 mln in 

2008. 

• Moldova is a net exporter of beer and soft drinks. 

• There are 11 large and medium scale enterprises in Moldova that are producing mineral 

water and freshener beverages, for example: EFES VITANTA MOLDOVA BREWERY JSC 

(beer and soft drinks), BeerMaster JSC , RESAN LLC, a Moldovan-German company 

producing soft drinks and mineral water and RUSNAC-MOLDAQUA LLC. 


• Walnut production and processing: According to the International Trade Centre in 

Geneva, Moldova is one of the largest European exporters of walnuts, after USA, Mexico 

and China. The walnut growing area includes 6,000 ha and is constantly expanding. The 

production of walnut sums up to 15-18,000 tons annually. Most of the below-mentioned 

companies are exporters and processors of products destined for the EU markets: 

Reforma Natural Fruit and Nuts, a German investment operating in Moldova in walnut 

export; Monicol, processor and exporter of dried fruit and walnut kernel; VM Plumcom 

processor and exporter of dried fruits; Prometeu-T, major processor and exporter of walnut 

kernels in Moldova. 

• Dried fruits production: The Moldovan dried fruit sector consists of a few large and 

medium companies and a large number of small enterprises. Over the past three years 

Moldova produced 2,000-3,500 tons of dried fruit per year, depending on the growing 

conditions for raw material. Export levels are usually about 70% of production, the EU 

absorbing about 80% of the exports; CIS countries, primarily Russia, Belarus and Ukraine, 

accounting for the other 20%. 

Packaging, logistics, machinery and equipment 

• Packaging is available in Moldova based on own production and on imports. Various 

companies deal with different packaging material. Larger companies are Horn and the 

Glass Container Company which has been supported by EBRD in the past. 

• Agricultural Machinery & equipment: Currently, there is only one tractor manufacturing 

enterprise: Tracom JSC, but it is not operational. In 2009, Moldova imported 2233 tractors, 

mostly from China, Belarus and Germany. Harvesters (combines) are not manufactured in 

Moldova, agricultural enterprises usually import from Germany or Russia. There are 

several companies in Moldova that are manufacturing other agricultural machineries. The 

largest ones are Moldagrotehnica JS and Agromasina JSC. 


2.5 Albania 



Albania has been one of the fastest-growing economies in Europe with a steady economic 

growth of 6% during the recent years, though the economic crisis has affected the country in 

2009 and 2010. Still, IMF foresees a positive 2.6% economic growth for 2010 in Albania. 

Inflation has been in the range of 2 - 4%. Economic development was accompanied by rapid 

reductions in poverty. Poverty fell by half (to about 12.4 percent) between 2002 and 2008, while 

extreme poverty now affects under 2 percent of the population. 

Currently Albania imports € 434 mln worth of food and agriculture goods, representing 18% of 

total Albanian imports. Consumption is increasing due to increased incomes and economic 

growth. A significant part of imports is destined for industrial/processing purposes and has 

stirred up new profitable activities both in the agriculture and agro-processing sectors. The main 

product categories imported in Albania are wheat and rye, fruits, vegetable oil, followed by fresh 

and dried vegetables, potatoes, rice, livestock/meat and all kinds of processed food as well as 

agriculture machineries. Imports are mostly coming from Italy and Greece (29%) followed by 

Brazil (meat), Germany, Russia, Turkey and other countries. 

The agriculture and food processing sector has been one of the growth drivers in the economy. 

Production value of this sector was 35% higher in 2008 than in 2000. About 2,120 enterprises 

are currently operating in the agro-processing sector. While they are operating in a variety of 

sub-sectors, larger enterprises are found in the flour production, milk processing industry, meat 

processing industry, refined oils, wine and other beverages. However, the competitiveness of 

the food industry is limited. Besides retail and wholesale, meat and beverage sub-sectors, most 

of the food industry companies in Albania are of relatively small size. 


Retail & Wholesale Euromax , 

Mercator (Slovenian) 

Conad 

Meat Frigo Food (poultry) 

EHW GmbH 

KMY 

Floryhen (poultry) 

Dairy Mireli 

Ferlat (Meggle) 

Beer Stefani & Co 

Birra Tirana 

Birra Korca 

Mineral Water/ 

Alfa Glina 

Soft drinks 

Tepelene 

Uji Qafshtama 

Coca Cola 

Milling Bloja, Mielli, Atlas 

Oilseed Erbiron, Olim 

F&V Sejega 

Wine Kantina Gjergi Kastriot Skenderbeu 

Herbs Albducros 

Fish Euro Fish, Poseidon 




• Suitable climate especially for F&V products 


• Business orientation and entrepreneurship 

• Food Safety Agency has recently been 

established 

• Fragmented primary production 

• Low supply of raw material to processing 

industry due to VAT exemption of 

farmers 

• Processing industry mostly small scale 

• Albania is a net importer of food. 

• Low purchasing power 

• Low law enforcement in food safety 

• Certification bodies for quality 

management (HACCP) not accredited, 

leading to higher certification costs when 

exporting 



• Import substitution for a variety of products 

(in areas, where price competitiveness is 

possible) 

• Development of retail sector 

• Competition from imports 

• Corruption 

• Countability of political parties 

• Infrastructure (power cuts, road network, 

waste/waste water management etc) 

• Image of Albania (more ‘poor’, ‘chaotic’) 

despite enormous changes in the country 



• Food retail chains are a brand new sales practice in Albania in the last three years. The 

retail sector has been one of the most dynamic sectors in Albania. Shopping centre 

development has been a key contributor to retail growth over the past few years. Due to 

the economic crisis, the index of retail sales notes a decrease during 2009. However this 

has not impeded investment plans in the retail sector. In the medium term (2-5 years), it is 

foreseen that the retail market in Albania will continue a positive high growth with over 

100,000 m2 of retail development. 

• These developments open good perspectives for more food varieties, canned foods, etc 

where Albanian production is still very much lagging behind. 

• Larger supermarket chains operating in Albania are Euromax, Mercator (first market 

opened in December 2009 in Tirana), Alfa-Beta Vassilopoulos, Conad. 

• The Kosovo based chain ETC expressed also interest to expand to Albania. 


• Slaughterhouses: In Albania many slaughterhouses are not in operation and the active 20 

slaughterhouses only slaughter few cattle or pigs or small ruminants daily. All 

slaughterhouses are operating far below their capacities due to low supplies. Usually the 

facilities are outdated and in most cases they do not even comply with the Albanian law. 

EU standards on hygiene, public authority, traceability and HACCP are not fulfilled. 

• There are three major slaughterhouses for poultry in rather good condition: Chicken Farm 

in Kavaja belonging to Frigofood company), AGRIZOO in Lushnja region, DRIZA in Fier 

region. 


• The situation in the chicken sub-sector looks much better as here are several investors 

active also in other agribusinesses, e.g. feed production companies or slaughterhouses. 

There is a trend to establish a complete integrated chain of operations, from chicken farms 

to feed mill and retail outlets. Aiba Company shpk (www.aiba.al) and Floryhen shpk 

(www.floryhen.com) dominate the chicken and egg production in Albania and belong to the 

three big fodder producers together with AGROTEK ALB shpk, control 70 – 80 % of the 

market in Albania. Wheat and barley for animal feed is purchased mainly locally, but other 

inputs are imported from Greece, Italy and Serbia. 

• Meat Processing: There are currently 14 consolidated meat processing enterprises that 

operate throughout Albania. The current market size is €55 million, processing 21,500 

metric tons of meat per annum, 85% of which serves the domestic market. 

• 95% of the meat processed in Albania is imported, primarily from South America. Local 

meat is too expensive and of limited availability. The processed meat is mainly pork, but 

also poultry and beef. Meat processing companies use modern technology in processing 

frozen meat but face limited know how in processing fresh meat since most processing 

companies import meat for processing. 

• The leading companies have a sound documentation of their production including 

traceability and applied HACCP. Albanian standards according to Food Law and orders of 

MAFCP are often applied; even EU standards on hygiene, public authority, traceability and 

HACCP are in place at big companies which are almost ready for EU export licences. 

• The premises of the top meat processing companies like EHW, KMY, TONA are very 

modern and fulfil already EU standards. Therefore, best opportunities are among this 

relatively small, but dynamic group of companies that aim to produce for export markets. 

These companies often import their raw materials from the world market and export to 

adjacent markets like Kosovo, Macedonia, Yugoslavia. 


• The total national milk production of Albania was ~ 1 mln tons in 2008, out of which 

860,000 tons are cows’ milk. The commercial market consists of informal (direct selling 

from farmers) and formal market channels (collection & distribution by dairies).More than 

half of the milk produced in Albania is used for self consumption, sold directly in the 

informal markets or used for feeding of animals and less than 50 per cent reaches the 

processing industry. 

• The dairy processing industry is still on the way of modernizing structures and 

technologies. The system of value added tax (VAT) is a major obstacle for the processing 

industry. A 20 % VAT is charged on all products. Since farmers are excluded from VAT 

payments, the tax is levied on processed products only. This increases the retail price and 

aggravates competition of processed products compared to the informal market. 

• There are about 27 modern dairy processing plants in Albania operating with a capacity of 

10-40 tons per day but struggling with competition from the informal market. None of them 

can utilize its capacity. The dairy plants with complete milk processing lines are producing 

pasteurized milk, yogurt, UHT milk, butter, butter milk, curd, cheese and fruit yogurt. 

• Meggle is now the first foreign milk processing company active in the milk processing 

business in Albania. MEGGLE Eastern Europe Ltd. officially became in August 2010 a 

100% owner of the Albanian dairy Ferlat sh.p.k. with a headquarter situated in Rhogozine. 

The Dairy Ferlat sh.p.k. is one of the largest dairies in Albania, located in Tirana province. 

According to Meggle, with more than 10 tons purchased raw milk per day Ferlat has growth 

and capacity enlargement potential, especially with regard to its 57% market share in 

consumer milk. Other larger dairies in Albania are Greal in Korca, Mireli in Kavaja, 

Deltadoni in Lushnja, and Gjirofarma in Gjirokastra. 



• Cereal production and flour mills: Wheat production in Albania reaches 300,000 tons in 

2009; not showing much increase in the last decade. Albania's milling industry uses mostly 

imported grain. The five important milling plants (Sh. A. Mielli, Prima- Bloja SH.A,. Atlas 

SH.A., Mulliri i Arte and Prima) in the country cover about 50% of market needs 

according to data from the factories and the Ministry of Food & Agriculture. 

• Edible Oil: Larger companies dominate the domestic markets. One is the prominent 

company of OLIM processing a variety of seeds with sunflower the most important. Other 

larger companies are Vajra Bimore Fiol and Erbiron. 

• The olive oil sector provides potential for SMEs, in particular in the field of organic olive 

oil. At the same time there are hurdles to be overcome: product quality should be 

improved, the value chain is rather inefficient, and international trade is not yet mature. In 

view of the growing market for organic olive oils in Western Europe, the production 

conditions in Albania can offer an attractive sourcing option. Agrotal 1 SHA is one of the 

few Albanian companies with EBRD as shareholder (30%). 


• The main vegetables produced in Albania are cucumber and tomato. Winter season 

vegetables cultivated include lettuce, spinach, carrot and cauliflower. The absence of profit 

tax on farmers on the one hand, and of protective measures for home production on the 

other, have had a considerable influence on agriculture production, especially in 

greenhouses, reducing imports and beginning to export modest quantities of vegetables. 

• The vegetable and fruit processing industry fulfils only 30% of the needs of the domestic 

market. The processing industry is dominated by micro and small enterprises. There are 

only two companies, with more than 100 employees using both local and imported raw 

material. One of these companies, Sejega, is located in Tirana, and the other, Sidnej, in 

Berat. These are the only companies producing both for the domestic market and for 

export. In addition, there are several medium sized companies: In this group are Shpiragu 

(in Berat) and Kampion (in Shkoder). 


• Albanian grape production is primarily dominated by small, independent vineyards. Quality 

standards of the grapes are generally low due to heterogeneity of cultivars and inefficient 

agronomic production practices. Some quality improvement trends have been recorded 

recently, but the quality achieved still falls short of the standards of many wineries in EU. 

70%-75% of wine consumed in Albania is produced by farmers and/or small wineries which 

are not licensed. Important spirit producers and wineries are Aquila Liquori,and Kantina 

Gjergj Kastriot Skenderbeg. 

• More than 80% of total Albanian wine imports come from the EU countries, with Italy as the 

main supplier (82% of EU imports). 


• In the past few years local beer producers have made investments totalling up to € 30-40 

mln with production capacity providing for more than 120% of national beer consumption. 

The beer industry has used its influence within the state administration in terms of 

protectionism and negotiations on free trade agreements with other Balkan countries and 

the European Union. The competition for the industry comes mostly from Greece and 

Serbia. 

• Birra Malto is the largest brewery in Albania. The company sells a pilsner beer under the 

Birra Tirana brand, named after the capital, Tirana, where the beers are brewed. Further 

important beer brewers are Birra Korca and Stefani & Co. 

• Soft drink market is dominated by Coca Cola; important mineral water producers are from 

Alfa Glina, Tepelena, Dilo shpk Uji Qafshtama produced by EHW Group. 


Niche products (Fish) 

• In the fish sector, investment opportunities are related to bad conditions of the fleet, and 

investments are needed in almost every part of the supply chain including harbour facilities, 

fleet renovation and maintenance facilities, fish collecting/warehousing and fish processing. 

Aquaculture becomes more and more important in Albania as well. 

• Opportunities for outsourcing production in the fish processing are already a successful 

experience since many years in Albania for many Italian companies. In fish processing 

there are some 27 companies in the field, all of which need modernisation. Important 

processing companies are Italian companies Euro Fish and Poseidon. Konservimi 

Adriatik and Rozafa, Albanian company is well known for fresh and processed fish. 

Niche Products (Herbs and Spices) 

• Most exported products from Albania in the agro-business sector have been medicinal 

plants noting a 16% growth from 2007 to 2008. The International Trade Centre ranks 

Albania as a champion country and having a very high comparative advantage for these 

products in the world market. 

• Albania produces over 60 varieties of herbs and spices, including cooking spices, medicinal 

herbs, and essential oils. This is an innovative and growing industry that has become a 

major supplier to global food companies, as such Albanian herbs are renowned the world 

over. 

• There are about 10 export companies, exporting their products mainly to the US, the EU 

and Turkey. Spices and herbs normally have the same trade structure and distribution 

channels and very few traders deal exclusively in herbs. Leading companies in Albania in 

the herbs sector are: Albducros, Filipi (exporting sage to the US), Xherdo (producing 

essential oils) 

Packaging, logistics, machinery and equipment 

• Packaging comes mostly from imports. Albanian imports in paper and packaging product 

reaches up to 20% of the total sales of the food processing industry. Currently most of 

packaging is imported (metallic packaging is all imported), while paper/cartoon packages is 

offered also by several domestic producers. 

• MORPACK ALBANIA SH.A: Morpack produces irrigation pipes and plastic packaging 

materials and belongs to Elbisco Holdings S.A.. Other companies in this field are Edipack 

and Alb Paper. 


2.6 Kosovo UN Res. 1244 



On 17 February 2008 the Kosovo Assembly adopted a resolution declaring Kosovo 

independent. It is now named Kosovo under UNSCR 1244/99. Over the past few years 

Kosovo’s economy developed further and made progress to a more market-based economy. 

However, remittances from abroad are still very important (~14% of the GDP) and 

unemployment (over 40%) is a significant problem. 

Kosovo has one of the most open economies in the region, with low customs rate on imports 

(1% for products from CEFTA countries, 10% for goods from EU, 0% for agricultural inputs and 

capital goods), and customs-free access to the EU and the US market. 

Kosovo is a relatively small country with an area of about 1.1 million ha, of which around 53% is 

considered to be agricultural land. Approximately 87% of the agricultural land was in private 

hands, the remainder is administered by the Kosovo Privatisation Agency (KPA). Irrigation 

systems are a constraint to agricultural production, and Kosovo has limited water resources. 

Cereal and fodder crops account for the largest share of arable land in Kosovo, followed by 

vegetables. Overall production levels are very low and cannot satisfy domestic demands (e.g. 

self-sufficiency for vegetables: 13% and for fruits only 6%). Cattle production including milk 

production is mostly taking place on very small-scale farms. Farms are usually small (3.2 ha in 

average) and mostly semi-subsistence production, with a very significant share of on-farm 

consumption and informal trade. Market integration is low. Agro-processing firms used to be 

part of Agro-Kombinats, which were mostly privatised. Kosovo has a tradition in wine 

production, but most of the plantations are relatively old now. 

Kosovo is a strong net-importer of agri-food products. Overall export level is insignificant, and 

agri-food imports are amounting to more than 400 million EUR (2008). Most of the agri-food 

trade is with the neighbouring countries Serbia, Macedonia and Albania. The main agri-food 

import products are: Tobacco, Beverages, Meat, Cereals, Dairy produce, eggs, honey. Most of 

the companies in the food sector in Kosovo are still relatively small, with the exception of a 

larger retail & wholesale company Elkos Group, ETC, the company Abi, and the brewery Peja. 


Retail & Wholesale Elkos Group (ETC, private) 

Interex 

Albi Shopping 

Benaf 

Beer Peja Beer (beer, soft drinks) 

Wine Stone Castle 

Haxhijaha 

F&V (incl. potatoes) Pestova Company (proc. potatoes) 

ABI & Elfi (part of ABI) 

Milk Devolli Company 

Abi Dairy 

Meat Koral – Prishtine 

Alaska (meat importer) 

Flour mill M&Sillosi 

Others APS – Medical & Aromatic Plants 




• Long tradition in agriculture, Suitable 

climate for a variety of products 


• Young population 

• Links to diaspora 

• One of the main suppliers of potatoes 

in the region 

• Well developed retail sector 

• Fragmented primary production, limited 

storage and post harvest capacities 

• Fragmented processing (mostly small family 

businesses) 

• Frequent power cuts and general weak 

infrastructure (roads, irrigation) 


• Opportunities on the domestic market 

(Import substitution) 

• Opportunities for export for specific 

products (e.g. potatoes, products for 

the diaspora) 

• CEFTA member (access to markets 

in the region), Custom free access to 

EU market (EU Western Balkan 

Pact), Bi-lateral free-trade agreement 

with the US and other countries 

• Privatisation opportunities 

• Relatively small domestic market 

(~ 2 million inhabitants) with low purchasing 

power of the population (very high 

unemployment) 

• Dominance of foreign products and brands 

• Underdeveloped quality control mechanisms 

• Limited price competitiveness 


Retail and wholesale (food products) 

• Kosovo’s retail market traditionally is fragmented, with competition mainly among small 

family shops. In recent years, supermarkets are increasingly dominating (with areas of 

around 3,000 m², with foods and drinks taking up 25-30% of the total trade area. The new 

trade centres are being built mainly on the outskirts of big cities. 

• The rise in number of foreign-owned stores is expected to boost the import of goods 

offered under the chains’ own brand. Many products are imported from Serbia, some 

experts estimate that nearly 70% of consumer goods in Kosovo come from Serbia. 

• Elkos Group (ETC markets) is the main distribution company in Kosovo. ELKOS was 

founded in 1990 as a retail store, and then moved into wholesale, and steadily grew further 

until 1998/1999. From 2000-2005, growth rates were again extraordinary high, as ELKOS 

established itself as a distributor for European producers and opened around 14 

supermarkets in all major cities. Other supermarket chains are Interex (France), Albi 

Commerce, and Benaf. 



• Meat consumption: ~102,000 tons (2007). Raw material and final products are to a large 

extent imported. 

• Livestock: Local production is mainly on a very small-scale. There is a considerable 

amount of on-farm consumption and informal trade. Local farms supply between 15-20 % 

of Kosovo’s formal meat market, with a remaining balance of some 80-85% being imported 

(2007). Traditionally Kosovo was an important exporter of lamb meat. 

• Kosovo has ~12 meat processing companies that together process approximately 3,000 

tons of locally produced meat annually (2007). There are about 6 relatively large meat 

processors supplying around 15-20% of Kosovo’s domestic market. Almost 100% of the 

packaging material needs are imported. The Government is elaborating a strategy how to 

improve the food safety standard in dairy and meat processing plants. One can expect that 

some establishments will be closed, and others need to invest to meet the required 

standards. 

• A major meat processor is Koral, Prishtina. A chicken meat and egg producer is KonSoni, 

Gjilan. Alaska and Valvis, Prishtina and Prizren have the biggest slaughtering facility in 

Kosovo, using mostly imported livestock. 


• Demand for milk is estimated at ~320-340,000 tons. Local milk production is estimated at 

~ 240-260,000 tons (number of milk cows estimated at ~140,000). Milk is mostly consumed 

directly on the farm or sold as raw milk or sour cream, white cheese on local markets.. Only 

about 10-15% of the milk is supplied to dairies (estimate about 34,000 tons). Imports 

amount to ~82,000 tons per year (milk products in milk equivalent litres), amounting to 25- 

30 million EUR annually. Import products are mainly UHT milk, yogurt, butter, white cheese 

and yellow cheese. About 80% of its imports come from the EU, mainly from Hungary, 

Slovenia and Germany. 

• Kosovo has ~26 processing units, of which only 18 are licensed. Of those, about 5-6 

diaries may be called ‘commercial’ (with 5,000-40,000 litres intake per day). The dairies 

mainly produce liquid milk, yogurt, white cheese. The dairy processing industry in Kosovo is 

currently in the process of implementing and integrating quality management systems. 

• Devolli Company, Peja, began in 2003 with the production of Vita UHT milk. Vita milk is a 

cooperation between Devolli and Tetra Pak. In addition to producing UHT milk, Devolli also 

packages coffee and different juices. Abi Dairy (linked to Abi supermarkets) processes 

about 20,000 litres of raw milk. Another growing dairy is Bylmeti. 


• Cereals (wheat, maize, barley) are the main cultures that cover the major part (70%) of the 

cultivable land (arable land and gardens) in Kosovo. Production (2007): Wheat: ~250,000 

tons; Maize: ~ 330,000 tons; Barley: ~11,000 tons (~86% for beer production). For the 

latter, 36 farms growing barley for a single brewery. 

• Kosovo has 22 feed mills with an annual capacity of ~113,000 tons (2007). One of the 

biggest is M&Sillosi in Xerxe, Rahovec, which was privatized several years ago. 

• Bakeries seem to be mainly small. 


• Vegetable production on 25-28,000 ha (mainly in regions Dukagjin and Anamorava), of 

which about 200 ha greenhouse area. Vegetable production is estimated at ~200,000 tons 

of potatoes, ~65,000 tons cabbage, ~100,000 tons of green peppers, ~55,000 tons 

tomatoes. However, statistical data on overall fruit and vegetable production in Kosovo are 

not always reliable, and differ often from source to source). 


• Fruit production on about 3,000 ha. Production (2006): Pears: ~15,000 tons, Apples: 

~60,000 tons, Sour Cherries: ~ 3,500 tons, Plums: ~25,000 tons. Watermelons and melons: 

~53,000 tons. Local demand cannot be met, although primary production has increased in 

recent years. The majority of processed fruit products are imported. 

• There is a demand for high quality local produce from the supermarkets. The current 

bottlenecks are missing post harvest handling capacities (cold storage, grading, and 

packaging) and modern processing capacities. In 2007, it was estimated that local 

processors cover just some 30% of local market needs for vegetables, and less than 10% 

for processed fruit products, with the balance being imported. 

• Pestova is a leading potato producer and processor in Kosovo and one of Kosovo’s few 

exporters. The company was founded in 1991, was severely damaged during the Kosovo 

conflict in 1999, and resumed its activities in 2000. The company started with primary 

production of potatoes, and later invested into production of crisps and potato frozen 

products. 

• Abi & Elif 19, also known by its brand name Progress, is a processor of fruit and vegetable 

products, i.e. marmalade, jams and jellies, ketchup, peppers, cucumbers, green bean and 

other products. PAbi& Elif 19 is the most significant food processor of fruit and vegetables 

in Kosovo with 150 employees. 

• Other smaller processors are MOEA (recently started fruit juice production), Dona, Tango, 

Frutti (juice production based on concentrates. 


• In 1980s, Kosovo winemakers produced 50 mln litres of wine a year, of which up to 40 mln 

litres were exported. However, about 50% of the vineyards were destroyed in the 1990s. 

Now, there are about 5,000 ha vineyards. Production is taking place mainly in the south 

and west of Kosovo. Processing capacities of wineries are ~ 125 mln litres (2007). 

• There were four formerly state-owned wineries with the following capacities, of which three 

are now privatised. One of the privatised wineries is Stone Castle (“New Cellar“) in 

Rahovec. Stone Castle produces about 10 mln litres and exports more than 90% of it. 

Another private winery is Haxhijaha (“Old Cellar”) 


• There is own main brewery in Kosovo, the Peja Brewery, which is in Slovenian ownership. 

Peja brewery is also distributing soft drinks. 

• Bonus Bonita, Lipijan, is the key producer and distributor of mineral water. 


• There is a small number of companies specialised in niche products, such as APS, Istog 

(medical and aromatic plants), APC, Podujevo (forest fruits, mushrooms), and Trofta, Istog 

(fish reproduction and production). 


2.7 FYR Macedonia 



About half of all agricultural land in FYR Macedonia is pasture, 40% arable land, with the rest 

being land under permanent crops and meadows. Average farm size of private farms is 1.4 ha, 

but there are also some larger agricultural companies leasing land from the state. Vegetables 

and horticultural products make up the largest share of agricultural output (28%). Wine 

represents about 7% of the agricultural output. The area under cereals shows a downward 

trend, as imported wheat can be found at lower prices than domestic production. Regarding 

animal production, pork meat contributes more than 40% to total domestic meat production, 

followed by cattle (38%), sheep and goat. 

FYR Macedonia is a net-importer of agri-food products (€550 mln exports and €440 mln imports 

in 2009). The main food products exported are wine and other beverages, fruits, vegetables and 

nuts. Half of Macedonian agri-food commodities are exported to the Western Balkans (among 

which Serbia is the leading export market), followed by the EU markets. The main agricultural 

import products are meat, products of milling industry, cereals, sugars and confectionary, dairy 

produce, eggs, and honey. Import duties for agricultural products are relatively high, for some 

fruit and vegetable as well as lamb carcasses 20-40%, and for wine and some processed 

vegetables even as high as 45-50%. Import tariffs for beef meat, milk and butter are about 13- 

25%. Import duties are low or zero for cereals and for agricultural machinery. 

In FYR Macedonia, there is currently a strong expansion of supermarkets and hypermarkets 

ongoing. So far, there are still various players in this field (Tinex, Veropulos, Skopski Pazar, 

Kam Market), and further chains plan to enter this market (e.g. Mercator). In the processing 

industry, the involvement of foreign companies is increasing, e.g. Imlek Serbia/DFG invested 

into two dairies in Macedonia, and Agrokor invested in a winery and recently in a vegetable 

wholesale market. A number of Greek investors are also present, e.g. Veropulos supermarket, 

flour mill Zito Luks. 


Retail & Wholesale Tinex MT 

Veropulos (Greece, Spar intern.) 

Skopski Pazar (SP) 

Kam Market 

Tediko Super 

Ramstore (Migros Turk) 

Wine Tikvesh 

Skovin Winery 

Povardaric (capital from Serbian) 

Lozar Veles (Mac&Island capital) 

Vila Marija (3 wineries) 

Anska Reka Valandovo (Agrokor) 

Fruits and Vegetables Vitaminka 

Vori 

Zora sped 

Di EMGP 

Bonum 

Makedonija AG 

Frukta 



Meat Pekabesko 

MIK Sveti Nikole 

Beer, Soft Drinks Pivara Skopje 

Pivara Prilep 

Pivara Bitola 

Milk MD Mlekara Bitola (Imlek/DFG) 

Dairy Ideal Sipka 

Zdravje Radovo 

Flour mills, bakeries Zito Luks (Greek ownership) 

Zito Vardar 

Edible oil Brilijant oil factory, 

Blagoj Gjorev-Kristal 

Confectionery / Snacks / Swisslion Skopje 

meal solutions 

Vitaminka AD 



• Suitable climate, in particular for wine and F&V, 

long tradition in agricultural production 

• Long tradition of wine export to the EU and to 

Serbia and of vegetable export to other 

countries in the region 


• Crossroads of 2 main European transport 

corridors, very low corporate tax, several 

investment zones 10 years tax holidays 

• Agriculture is a priority of the Government 

• Processing companies have invested in 

expansion, modernisation and quality control 

• Wine export mainly in bulk 


leading partly to higher production 

costs of primary production, and 

difficulties in organising sufficient 

quantities for export 

• Insufficient organisation of joint export 

(problem of quantities) 

• Many processing companies are still 

relatively small in size 


• Retail structures expanding rapidly, leading to 

more demand for larger processing and 

production units 

• Opportunities to increase export (bottled wine, 

vegetables, and niche fruit products) 

• Opportunities for import substitution on the 

domestic market 

• Duty free access to EU market (e.g. bulk wine 

export quota); CEFTA member, incl. Export 

opportunities via Serbia to Russia; Free-trade 

agreement with Ukraine and Turkey 

• Relatively small market 

(~2 million inhabitants) 


• Retail structures may be saturated 

soon 

• Natural risks (draughts, floods) 

• Difficulties over the country’s name 

leading to delays in the start of 

negotiation for EU accession (even if 

Macedonia is a candidate country) 

and to difficulties for exports with 

‘Macedonia’ label 

• Rural depopulation 




• The retail market was growing strongly until 2008, with expansion slowing down in 2009 

due to the financial crisis. Most supermarkets/hypermarkets are in Skopje and in other 

larger towns. The retailers are keen to boost their market shares by developing own 

brands as well – a trend that has long been present in developed economies. Using their 

own brands, retailers offer cheaper products, with free advertising, thus positioning 

themselves better on the market. In Macedonia this trend is still at an initial stage. 

• Tinex is the Macedonian market leader (~25.5% market share, ~€80 mln turnover in 2009). 

Tinex retail chain was established in 1994 and is the oldest and largest retail chain in 

Macedonia. It boasts 32 stores and has a headcount of about 800 people. 

• Other larger retailer are Vero retail chains (~€50 mln turnover in 2009), Vero supermarkets 

are part of Greek Veropulos retail chain, which is in turn part of the international chain 

SPAR International. Veropulos entered the Macedonian market in 1997. 

• Kam market (~€36 mln turnover in 2009), and SP market (Skopski Pazar AD) (~€33 mln 

turnover in 2009). Further, there are Tediko, Ramstore Market (Migros Turk) and Tus 

(Slovenia), Mercator (Slovenia), Dauti Komerc, etc. 

Meat and meat products 

• There has been a decreasing trend of livestock production in the last decade. FYR 

Macedonia greatly depends on imported feed, maize, proteins and vegetable fats and well 

as complete fodder mixture. Pig production is significant (40% of total meat production). 

However, production is mostly small-scale for home-use. FYR Macedonia is a net-exporter 

of lamb meat. However, there is a downward trend (2000-2008) in sheep production 

because of reduction in the fodder base, high fodder prices, and low producer prices for 

meat, milk and wool. 

• The Macedonian market for cooled and processed meat products is estimated by 

Euromonitor (in: Gtai) to be 10,400 tons with a value of ~57 million EUR (2009). 

• Pekabesko a.d. is the market leader (23,5% market share, ~ €33 mln turnover in 2009), 

followed by MIK Sveti Nikole a.d. (~ €15.7 mln turnover in 2009) and Promes (~ €17.1 mln 

turnover in 2009). Others are, for example Soleta, Rimes, and Mega. All modern, larger 

meat processors have HACCP and ISO 9001. 


• Average annual milk production is about 200 million litres (2000-2006). Productivity has 

increased from 2000-2008, but is still far below the EU average. Most primary production is 

taking place in small-scale entities. Due to a crisis in the processing sector (failure of 

Swedmilk), milk prices and sales opportunities decreased. As a consequence, milking cows 

were reduced. 

• Sales of dairy products amounts to ~ €0.2 bln (2009). The fastest growing product group of 

nutrition/staples in 2009 was cheese with a value growth of 14%. However, average unit 

prices decreased in 2009 due to the increasing share of economy brands in a number of 

subsectors (Euromonitor International). 

• At the processing level, there are about 85 registered dairies, which are mainly small to 

medium sized enterprises. Dairies have mostly been taken over by foreign companies, e.g. 

from Serbia, Croatia . However, Swedmilk has gone bankrupt in 2009. 


• Market leaders are Mlekara Bitola AD-IMB (Imlek Serbia/DFG) with its brand bimilk (~ €29 

mln turnover), Ideal Sipka a.d., Bitola (~ €13 mln turnover; owned by Dukat/Lactalis), and 

Zdravje Radovo, Kumanovo (~ €11 mln turnover). Others are, for example, Beka 

Company Eko Shar, Bucen Kozjak (Imlek/DFG), Rudine, Laktis, and Dairy Stip. 

• Swedmilk Makedonija started to operate near Skopje in June 2007, but went bankrupt in 

2010. 


• Nearly half of the arable land is under cereal crops (i.e. about 200-250,000 ha), where wheat 

is the dominant crop, followed by barley and maize. Average annual cereal production 

amounts to ~ 564,000 tons. Sunflower was grown on about 6,000 ha (2000-2005), but there 

was a significant decrease in 2006. Nowadays, most sunflowers are imported. 

• Large flour mills are Zito Vardar, Veles (~€26 mln turnover), Zito Luks a.d., Skopje (Elbisco 

Holding, Greece) (~ €18 mln turnover) 

• Larger edible oil producers are Brilijant Oil factory (~ €34 mln turnover), and Blagoj 

Gjorev-Kristal (~ €10 mln turnover). 


• Macedonia is a net exporter of processed and preserved vegetables, particularly 

processed peppers and other preserved vegetables such as gherkins, cucumbers and 

mushrooms. 

• Vegetable production reaches about 680-750,000 tons (2000-2006), of which 160- 

193,000 tons potatoes. In 2007, the most significant vegetable production is in: tomatoes 

(17%), peppers (19%), cabbage (14%), melons and watermelons (19%) and potatoes 

(31%). The production takes place in open fields, in heated glass-house (260 ha), and 

under plastic tunnels with or without heating. 

• Fruit production: Orchards on about 15,000 ha with an average annual total production of 

125-150,000 tons, of which apples account for 50-60%, while the stone fruits (cherries, sour 

cherries, peaches, apricots and plums) accounted for 35% (2000-2006). Fruit production is 

mainly concentrated in the western part of the country. Apple production is mostly in the 

Prespa area around Resen. 

• Larger companies are Vitaminka AD Prilep (~€19 mln turnover in 2009). Further, there is 

Bonum (production and processing of mushrooms and of vegetable products), Vori Ltd., 

Zora Sped, Agro Komerc, Altra, DI EMGP, Frukta, Makedonija AG, Vipro, DIM Komerc and 

a number of smaller processing companies. 

• Agrokor (Croatia) started construction of a wholesale and distribution centre in Strumica for 

vegetables in autumn 2010. The market will contain cooling chambers, calibrators, 

packaging halls and a transport system for admission and distribution of 20,000 tons of 

industrial vegetables. 

Wine / Grape production 

• Vine growing on about 25,000 ha (of which about 11,000 ha in the Tikvesh district) with an 

average annual production of about 230-250,000 tons (2/3 for wine, 1/3 table grapes). 

Wine is the main source of income for over 30,000 households. Macedonia produces 

between 90 and 110 million litres of wine annually, with 90% of it exported in bulk and 10% 

in bottles. Volume growth in wine export is predicted to be in the Serbian market. 

• Per capita wine consumption of 12 litres is still below that of traditional and established 

wine producing countries (wine is still perceived as an occasional treat rather than an 

everyday alcoholic drink). 


• There are more than 50 wineries in Macedonia, the largest of them being Tikves AD (~ 

€21 mln turnover in 2009). Tikves is a privately owned joint stock company (majority owned 

by M6, a Macedonian investment group). The annual processing capacity is about 50,000 

tons of grapes and about 35 million litres of wine. 60% of the production is exported, mostly 

to former Yugoslav countries. Tikves together with Rici, a German company, created a new 

mixed company ‘Tikves Wines International’ in Munich. 

• Other wineries are Skovin Winery, Bovin Winery, Fonko, Popova Kula Winery, Imako, 

Povardaric, Aska Reka Valandovo (Agrokor), Rigo Impex, Vila Marija, Lozar Veles, Vinojug, 

etc. 

Beer and mineral water 

• Beer sales amounted in 2009 to ~ 94 million litres, ~ €144 mln Domestic manufacturers 

dominate beer with almost 80% of sales (Euromonitor International). Macedonia is neither a 

significant importer nor a large exporter of beer. 

• Market leaders are Skopje Brewery (~25% market share, ~€69 mln turnover in 2009), 

Prilep Brewery (~€17 mln turnover in 2009) and Bitola Brewery. 

• A larger producer of bottled water is Gorska Voda. 

Confectionary / Snacks / etc. 

• The market is dominated by products from international companies and companies of the 

region (e.g. Kraftfoods, Unilever, Nestle, and Kras, Croatia). 

• Larger local companies are Vitaminka AD (see also fruits and vegetable, total ~€19 mln 

turnover in 2009) and Swisslion Ltd, Skopje (~ €35 mln turnover). 


2.8 Montenegro 



Montenegro has a very small population, i.e. a small domestic market size. Most of the country 

is covered by high mountains, therefore together about 88% of the agricultural land is used for 

pastures and meadows. Only 9% of agricultural land is arable land and 3% of land is under 

permanent crops. An agricultural census recently took place in 2010 and data will be available 

soon. Production is mostly taking place in very small-scale structures. More than 2,500 ha are 

regularly irrigated in the area close to Podgorica, including more than 2,000 ha of vineyards of 

AD Plantaze. 

Montenegro is a net importer of food. Most of the imports are from Serbia (in particular 

fodder, livestock/meat, and milk). The total import value of agri-food products in 2008 was 426 

mln EUR, compared to 46.7 mln EUR exports. More than half of the export value comes from 

one group – beverages, of which EUR 17.2 mln comes from wine export. Other export products 

are tobacco, fruits and vegetables, meat and meat preparations. 

Except for retail chains and a few larger companies (such as 13-jul Plantaze), most other 

companies in the country are of relatively small size. 


Retail & Wholesale Delta (Delta Serbian) 

Voli 

Wine 13-jul Plantaze (state owned) 

Meat Mesopromet 

Goranovic 

Milk Dairy Zora 

Dairy Niksic 

Bakeries Aleksandrija, Daz 

INPEK 

Beer / Water / Soft Drinks Niksic Brewery 

Water Group 

Confectionery CRNAGORACOOP 



• Montenegro has a positive image as a holiday 

destination and ecological state (image 

supportive for wine export) 

• 13 jul Plantaze is one of the largest vineyards 

in one place (~ 2.300 ha, most of it irrigated) 



• Small-scale processing 

(except for 13 jul-Plantaze) 

• Difficult logistics in the North (high 

mountains, difficult access in winter) 



• Domestic market and tourist 

• Export markets for wine and some speciality 

products (e.g. ham) 

• Very small domestic market 

(only ~ 620,000 inhabitants) 

• Limited quantity of raw material 

• Dominance of foreign products 

• Natural risk (drought) 




• Voli is one of the leading retailers in Montenegro, owned by Voli Trade. Voli is a grocery 

retailer operating about stores in Podgorica and in four other towns. The company employs 

about 800 persons. The market share of Voli is about 10% (2009). Voli is a distributor of 

Carnex, Vital and Albus (Serbia), Vindija (Croatia), Zora (Berane), and Suza (new water 

brand, Montenegro). 

• Delta Holding, Serbia, opened the first larger shopping mall in Podgorica in 2008, 

including a Maxi Supermarket. Further, Delta has a number of supermarkets in other 

towns. 


• Montenegro needs to import livestock, meat and meat products. The demand for meat 

products and the capacities of the local meat processors is much larger than can be 

covered by local primary production. In particular, pigs / pig meat is imported, as local 

production is not is constrained by insufficient fodder production in the country. The total 

cattle population amounts to 106,000 head. Annual meat production is about 7,500 tons 

cattle meat, 3,500 tons sheep meat, plus poultry and pig meat. A speciality of Montenegro 

is smoked ham (however, with mostly imported livestock or meat as the basis). 

• Mesopromet DOO is the leading Montenegrin meat producer and processor holding about 

30% of the market share in Montenegro. Mesopromet buys pork and young bull, beef and 

chicken, and also established a network for selling its products. It produces smoked 

products and sausages. 

• MI Goranovic Ltd Niksic is privately owned by the Goranovic family, since 1986. With a 

daily capacity of 20 tons of meat products, MI Goranovic is one of the leading meat 

processors. 

• Martex started as a family business and has continuously expanded. It operates a factory 

producing traditional dried/smoked pork products near Cetinje. 


• There has been a downward trend regarding the size of livestock because of structural 

problems and depopulation of rural areas. Annual milk production is 160,000 tons. Only 15- 

20% of the total milk production is delivered to dairies, the rest is used in households for 

fattening calves, making dairy products or direct sale on local markets. 

• Dairy Niksic is a private medium sized dairy. Dairy Zora AD was established by Lux 

Development and later handed over to the Ministry of Agriculture. Dairy Podgorica is for 

sale. 

Bakeries, flour mills and edible oil 

• Cereal production is at a very low level, because of the special landscape of Montenegro. 

Cereals are grown on 5,000 ha (2008), with more than half used for corn-maize production. 

• Aleksandrija, Daz d.o.o., Herceg Novi, and INPEK, Podgorica are larger bakeries 

producing bread and various noodles‘ products. Sajo, Spuz is one of the larger flour mills. 



• Total annual fruit production: 30,000 tons of fresh fruits (23% oranges and tangerines, 

19% plums, 16% apples). 

• Vegetable production 2008: on ~ 8,000 ha, of which 60 ha in greenhouses. Products are 

cabbages, melons, tomatoes and peppers. Potato production on 10,000 ha, and 

productivity shows an increasing trend. 

• 13 jul-Plantaze, Podgorica (see also ‘wineries’) has a peach plantation of ~85 ha and 

produces about 1200 tons/year. Most other producers and processors are relatively small 

in size. 


• Vineyards cover 4,300 ha, of which about half is irrigated. 

• The most significant production is around Podgorica on the state owned vineyard and 

winery 13 jul-Plantaze (~2,300 ha, the largest vineyard in one complex in Europe). The 

capacity of the wine cellar is 30 million litres; sales are about 17 million litres annually. The 

state owns ~52% of Plantaze. The company was founded in 1963, and it deals with 

production of wine and table grapes, peach, production and distribution of wine and grape 

brandies, fish growing, catering and retail trade. Products are exported to the region, but 

also to EU, Russia, China and America. In 2008, the annual turnover was ~35 million EUR. 


• There is one dominant brand on the beer market: Niksic pivo. The brand is well-known not 

only in Montenegro, but also in all of the Western Balkans, in particular in Serbia. 

Accordingly, Niksic Brewery (Inbev) is the market leader for beer. 

• In recent years, there had been also more investments in water production. Bottled water 

companies are Water Group d.o.o., Kolasin and Bjelasica-Rada AD, Bijelo Polje. 

Confectionary and niche products 

• Niche production in Montenegro is mostly taking place at small scale level. 

• Crnagoracoop in Crikvenica / Danilovgrad is a larger producer of coffee, tea, chocolate, 

and biscuits. It has an ISO 22000:2005 certificate. 

• Olives and olive oil: Olive growing occupies 3,200 ha. The production potential of ~2,000 

tons olive oil is only 50% exploited. Olive oil in attractive bottles is sold to tourists. 

Olioprom, Bar, is one of the oil producing companies. 

• Fish: 13 jul Plantaze produced 86 tonnes of trout in 2008. 


ANNEX: BIBLIOGRAPHY and 

INTERESTING LINKS 

1. Serbia 

− Balkan Regional Center for Trade Promotion. Balkan Trade Bulletin. Serbia 

− Business Monitor. Serbia – Food & Drink Report. London: 2010 

− Economist media group. TOP 300. 2008 

− Ekonomski Institut. Sector Study in the Field of Agriculture and Food Industry in 

AP Vojvodina. Novi Sad: 2010 

− Exporter. Belgrade: 2010 

− InterCapital Securities. Serbian Food & Beverages. Belgrade: 2010 

− Ministry of Agriculture, Forestry and Water Management. Rural Development 

Strategy 2010 – 2013. Belgrade: 2009. 

− Serbia Investment and Export Promotion Agency (SIEPA). Fruit Industry in 

Serbia. 

− SIEPA. Vegetable Industry in Serbia. 

− USAID. Cultivated Berry Value Chain Assessment. USAID Agribusiness 

Project. Serbia: 2008 

− USAID. Dairy Value Chain Assessment. USAID Agribusiness Project. 2008 

− USAID. Herbs, Mushrooms, and Forest Fruit (Medicinal and Aromatic Plants): 

Value Chain Assessment. USAID Agribusiness Project. 2008 

− USAID. Tree Fruits. Value Chain Assessment. USAID Agribusiness Project. 

− USAID. Vegetable Value Chain Assessment. USAID Agribusiness Project. 

Serbia: 2008 

2. Croatia 

− AgriPolicy- Enlargement Network for Agripolicy Analysis: AN ASSESSMENT 

OF THE COMPETITIVENESS OF THE DAIRY FOOD CHAIN IN CROATIA, 

2009. ww.agripolicy.net 

− Business Monitor International. Croatia Food and Drink Report Q4 2010. 

London: 2010 

− Croatian Chamber of Economy. Croatian Exhibitors, Prodexpo 2008, Zagreb: 

2008 

− Lider 2010: Who is Who: Prehrambena industrija. www.liderpress.hr 

− Ministry of Agriculture, Fisheries and Rural Development of the Republic of 

Croatia. Croatian Agriculture. Zagreb: 2009 

− Royal Danish Embassy Zagreb, Trade Council of Denmark: Food & retail 

market in Croatia, 2007 

1

3. Bosnia and Herzegovina 

− Euromonitor International. Bottled Water in Bosnia-Herzegovina. London: 2010 

− Euromonitor International. Confectionary in Bosnia-Herzegovina. London: 2009 

− Foreign Investment Promotion Agency of Bosnia and Herzegovina. Agriculture 

and Food Processing Industry. Sarajevo: 2005 

− GFA Consulting Group/USAID. Trade Capacity Assessment for BiH Exports. 

Hamburg: 2007 

− GTZ. Development Studies for Sectors with Potential. Food Sector Study. 

Eschborn: 2001 

− Ministry of Foreign Affairs. Danish Support to Credit Programme in Support of 

Micro, Small and Medium Enterprises (MSMEs). Programme Document. Final 

Report. Copenhagen: 2009 

− RZB Group. Market Profile - Bosnia. 2009 

− The World Bank. Project Appraisal Document in a Proposed Credit in the 

Amount of SDR 13.8 Million to Bosnia and Herzegovina for an Agriculture and 

Rural Development Project. Washington: 2007 

− USAID Sarajevo Office. Investment Opportunities in Bosnia and Herzegovina. 

Sarajevo 

4. Moldova 

− American Chamber of Commerce in Moldova. Products of Moldova. Chisinau 

− Germany Trade & Invest. Wirtschaftstrend Kompakt Republik Moldau. Berlin: 

2010 

− GFA Consulting Group. Export Marketing Survey: German Market for Fruits and 

Vegetables. Export Promotion project funded by the EU. Chisinau: 2009 

− GFA Consulting Group. Export Market Survey: Fruits and Vegetables Market – 

Ukraine. Export Promotion Project funded by the EU. Chisinau: 2009 

− GTZ. Überblick über den landwirtschaftlichen Sektor in der Republik Moldau. 

Chişinău 

− Ministry of Agriculture and Food Industry of the Republic of Moldova. Agro- 

Industrial Sector. Chisinau: 2009 

− Ost-West Contact. Special Moldau. Berlin: 2010 

− USAID CEED 2009: Moldovan Wine sector appraisal, prepared by Chemonic 

− Various internet based information of USAID-CNFA Agriculture Development 

Project in Moldova 

5. Albania 

− Albinvest: Fact sheets 2008 

− AgriPolicy- nlargement Network for Agripolicy Analysis: AN ASSESSMENT OF 

THE COMPETITIVENESS OF THE DAIRY FOOD CHAIN IN ALBANIA, 2009. 

ww.agripolicy.net 

− Danish Ministry of Foreign Affairs. Programme Document, Value Chains for 

Sustainable Livelihoods VCSL, Albania. Copenhagen: 2009 

2

− DSA 2009: Olive Oil Value Chain, Authors: Luciano Leoneti et al. 

− Ministry of Agriculture and Food, Albania: Sector Strategy of Agriculture and 

Food 2007 – 2013 

− Royal Danish Embassy in Tirana. Food Agriculture and Agro Business (FAA). 

2010. http://www.ambtirana.um.dk 

− World Bank. Joint IBRD – IFC Country Partnership Strategy for Albania for the 

period FY11-FY14. Washington: 2010 

− World Bank. Albania, Strategic Policies for a More Competitive Agriculture 

Sector. Washington: 2007 

− World Bank: Strategic Policies for more competitive agriculture sector, 2007 

6. Kosovo 

− Chemonics International. Kosovo’s Meat Market Potential. Kosovo Cluster and 

Business Support project, financed by USAID. 2005 

− Chemonics International. Dairy Market Assessment Study. Kosovo Cluster and 

Business Support project, financed by USAID. 2008 

− Danida. Employment Promotion through Business and Skills Development 2008 

– 2012. Programme Document. 2007 

− EAR Marketing Support Project: Wine Sector Producer, Wholesaler & Trader 

Survey (Draft) 

− Ministry of Foreign Affairs/Danida. Project Description Document. 2005 

− Ministry of Trade and Industry. Top Enterprise 2009. Pristine 

− Ministry of Trade and Industry. Trade Exchanges of Kosova. Pristine: 2008 

− Ministry of Trade and Industry. Agriculture and Food Processing Industry. 

Pristine: 2008. 

− Privatisation Agency of Kosovo. Annual Report 2009. Skopje: 2009 

7. Macedonia 

− Agency for Foreign Investment of the Republic of Macedonia. Food Processing 

Industry Investors’ Guide 2007. 

− Euromonitor International. Alcoholic Drinks in Macedonia. London: 2009 

− Euromonitor International. Frozen Processed Food in Macedonia. London: 2009 

− Faculty of Agriculture and Food. Challenges faced by the Agro-food Sector in 

the Republic of Macedonia regarding its Integration in the EU Markets: Skopje. 

− GFA. Horticulture Marketing Study. Hamburg: 2000 

− Price Waterhouse Coopers. Guide to doing Business and Investing in 

Macedonia. Skopje: 2010 

− The World Bank. Implementation Completion Report on a Credit in the Amount 

of SRD 5.4 Million to the FYROM for a Private Farmer Support Project. 

Washington: 2003 

3

8. Montenegro 

− Directorate for Development of Small and Medium–sized Enterprises. 

Montenegro Business Guide. Podgorica. 

− Ministry of Agriculture, Forestry and Water Management. Montenegro’s 

Agriculture and European Union - Agriculture and Rural Development Strategy. 

Final Report of the EU funded Project. Podgorica: 2006 

− The Royal Danish Ministry of Foreign Affairs / Montenegrin Ministry of 

Agriculture, Forestry and Water Management. Programme Document. Organic 

Agriculture Development Programme Montenegro 2009 – 2011. Copenhagen: 

2008 

9. South- Eastern European Countries 

− AHK, Deutsche Auslandshandelskammern. Konjunkturbericht MOE 2010. 2010 

− Bundesministerium für Ernährung, Landwirtschaft und Verbraucherschutz. 

Deutscher Agraraußenhandel 2009. Berlin: 2010 

− Commission of the European Communities. Commission Staff Working Paper. 

EU regionally relevant Activities in the Western Balkans 2008/09. Brussels: 

2009 

− Commission of the European Communities. Communication from the 

Commission to the European Parliament and the Council. Western Balkans: 

Enhancing the European Perspective. Brussels: 2008 

− DEG. Annual Report 2004. Cologne: 2005 

− DEG. Auslandsdirektinvestitionen in Entwicklungs- und Reformländern. 

Cologne 

− Eurochambres. Obstacles to Investing in the Western Balkans. The View of the 

Private Sector. Brussels 

− European Bank for Reconstruction and Development. Agribusi9ness Sector 

Strategy. London: 2010 

− FAO/EBRD. Review of the Sugar Sector. Serbia and Montenegro. 2004 

− Gärke, Inge. Strategic Location Planning – for Foreign Direct Investments in the 

Food Industry and Agribusiness in South East Europe - . Hamburg: 2005 

− IAMO. Agriculture in the Western Balkan Countries. Halle: 2010 

− Noleppa, Steffen. Territoriale Entwicklung im ländlichen Raum Südosteuropas. 

Analysen und Handlungsempfehlungen für die Erstellung eines Konzepts. 2010 

− Podkaminer, Leon. Assessing the Demand for Food in Southeast Europe by the 

years 2015 and 2020. 

− UNDP. Review of Growing Sustainable Business Project in BiH, Macedonia, 

Moldova, Serbia and Turkey. 2007 

− The World Bank/IFC. Doing Business 2010. Reforming through Difficult Times. 

Washington: 2009 

− The World Bank. Enhancing Regional Trade Integration in Southeast Europe. 

World Bank Working Paper. Washington: 2010 

Further, information was taken from various websites 

(of companies, of chambers of commerce, foreign investment agencies, news 

agencies, etc.) 

4

Interesting Links 

Organisation 

Ministries of Agriculture 

Website 

Albania 

www.mbu.gov.al 

Bosnia and Herzegovina 

www.fbihvlada.gov.ba (Federation) 

(only on entity level, at state level: Sector for www.vladars.net (Republika Srpska) 

Agriculture at the Ministry of Economy) 

www.mvteo.gov.ba (Ministry of Economy, BiH) 

Croatia 

www.mps.hr 

Kosovo 

www.ks-gov.net 

Macedonia 

www.mzsv.gov.mk 

Moldova 

www.maia.gov.md 

Montenegro 

www.minpolj.gov.me 

Serbia 

Ministries of Economy 

www.minpolj.gov.rs 

Albania 

www.mete.gov.al 

Bosnia & Herzegovina 

www.mvteo.gov.ba 

Croatia 

www.mingorp.hr 

Kosovo 

http://mef-rks.org 

Macedonia 

www.economy.gov.mk 

Moldova 

www.mec.gov.md 

Montenegro 

www.minekon.gov.me 

Serbia 

Investment Promotion 

Agencies 

www.merr.gov.rs 

Albinvest, Albania 

www.albinvest.gov.al 

FIPA, BiH 

www.fipa.gov.ba 

Trade and Investment Promotion Agency, Croatia 

Remark: The Act on the Termination of the 

Croatian Trade and Investment Promotion 

Agency became active with the 8th of November 

2010 (Official Gazette 124/2010). 

www.apiu.hr; www.croinvest.org 

IPAK, Kosovo, and 

www.invest-ks.org; 

Office Vienna 

www.ipak-vienna.org; www.eciks.org 

Agency for Promotion of Entrepreneurship, 

FYR Macedonia 

www.apprm.gov.mk 

MIEPO, Moldova www.miepo.md 

MIPA, Montenegro www.mipa.co.me 

SIEPA, Serbia 

Chambers of Commerce (or 

Trade, Economy) 

www.siepa.gov.rs 

Albania www.cci.al 


www.komorabih.ba 

Croatia 

www.hgk.hr 

Kosovo 

www.oek-kcc.org 

FYR Macedonia 

www.mchamber.org.mk 

Moldova 

www.chamber.md 

Montenegro 

www.pkcg.org 

Serbia www.pks.rs 

5

Organisation Website 

Statistical Offices 

Albania 

www.instat.gov.al 


www.bhas.ba/new 

Croatia 

www.dzs.hr 

Kosovo 

http://esk.rks-gov.net 

Macedonia 

www.stat.gov.mk 

Moldova www.statistica.md 

Montenegro www.monstat.cg.yu 

Serbia 

http://webrzs.stat.gov.rs 

General information and 

statistical data 

Eurostat 

FAO 

World Bank 

East Agri Network 

Euromonitor 

Nov-Ost Info 

CEFTA 

EU Export Help Desk 

GTAI 

Financing Organisations 

DEG 

EBRD 

IFC 

EIB 

Regional associations in 

Germany 

OA 

OMV 

http://eurostat.ec.europa.eu 

http://faostat.fao.org 

http://data.worldbank.org 

www.eastagri.org 

www.euromonitor.com 

www.nov-ost.info 

www.cefta2006.com 

www.ceftatradeportal.com 

http://exporthelp.europa.eu 

www.gtai.de 

www.deginvest.de 

www.ebrd.org 

www.ifc.org 

www.eib.org 

www.ost-ausschuss.de 

www.o-m-v.org 

6

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