Competitiveness of the EU dairy industry

Competitiveness of the EU dairy industry

5.8 Most innovative countries

Table 5.8 present the number of innovations by region and country and figure

5.2 presents the innovations in EU countries. Although the UK leads the USA,

experts in the industry do not see the UK dairy companies as very innovative.

They refer to the problems the UK has in using its full milk quotum and the problematic

financial situation of a large part of the industry (Plimsoll, reported in

Dairy Industry Newsletter, 1.7.2008). However, in a benchmark report KPMG

LLP (2007) reports the competitiveness of the UK dairy industry as rather favourable,

based on the high labour productivity.

There is coherence between our findings and the experts in that certainly in

the UK the innovation is led by the retail (sometimes directly in combination with

farm groups) and by related industries like packaging and ingredients. This view

can contribute to the impression that the dairy companies themselves are not

the most innovative. Also KPMG LLP (2007) reports lower levels of revenue per

unit of milk processed in the UK, probably due to lower overall investment in

R&D and it recommends investment in innovation. In our analysis on the next

pages, we are not able to link innovation in the UK to higher economic results,

which also raises questions. So for the mean time the conclusion should be

drawn that, owing to pressure from retail, the dairy industry at large in the UK is

perhaps more innovative than the companies' factories and profits suggest, but

not as innovative as our analysis of trade journals suggests.

Table 5.8 Number of innovations classified according to benchmark


Region/Country Number %

EU-27 449 61

USA 142 19

New Zealand 29 4

Canada 16 2

Australia 12 2

Brazil 1 0

Switzerland 30 4

Japan 10 1

Other countries 50 7


Source: Own findings.

739 100


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