Focus on Italy
May 8, 2014
Italy is known the world over as the home of pasta, and Italy’s grains sector is notable for the importance of durum wheat processing. Exports of pasta have helped Italy’s flour milling sector outperform some other parts of the economy in recent, difficult years.
The International Grains Council (IGC) puts Italy’s total grain production in 2013-14 at 16.3 million tonnes, down from 16.8 million the year before. Of that, total production of all wheat is put at 7.3 million tonnes, down from 7.7 the prior year. The maize crop is put at 7.6 million tonnes, up from 7.5 million the year before.
Italy’s durum wheat crop is projected at 4 million tonnes, down from 4.2 million the previous year.
According to the milling industry body Italmopa, Italian milling employs 4,500 people in 375 mills. Production of flour, wheat flour and durum wheat semolina amounted in 2012 to 7.445 million tonnes (including 3.884 million tonnes of wheat flour and 3.561 million tonnes of durum wheat). The association notes that, at the time, demand for food industry products fell, but exports of pasta and confectionary allowed it to keep production relatively stable.
The total turnover of the milling sector in 2012 was about €3.619 billion, an increase of 2.2% compared to 2011 (€3.538 billion).
The increase in turnover was mainly driven by an increase in the prices of byproducts of the milling industry for livestock that have experienced significant increases, especially in the sector of common wheat, the association said. It also noted that increased energy and transport costs and more difficult access to credit were likely to squeeze already tight profit margins in the sector.
Production of durum semolina for the pasta industry was about 3.561 million tonnes in 2012, according to Italmopa. Its figure for 2011 was 3.524 million. Demand for semolina was supported by an increase in pasta exports. The positive trend in exports has helped to offset the effect of a long-term down trend in pasta consumption in Italy.
Production of wheat flour fell to 3.844 million tonnes in 2012, from 3.888 million the year before. The association noted a 2% fall in flour for commercial bread making, with an increase in the use of flour for products like breadsticks or crackers which provide a longer lasting alternative to fresh bread. It also highlighted clear signs of an increase in baking in households with increased sales of basic ingredients like wheat flour.
Major international players are involved in the pasta business. Syngenta announced in April that it has acquired Societa Produttori Sementi (PSB), one of Italy’s oldest seed companies and a leader in durum wheat breeding and production for pasta.
“Together we will accelerate innovation in high-quality durum wheat production, helping more growers prosper in the competitive Italian market as well as supporting international expansion,” said Syngenta Chief Operating Officer, John Atkin.
PASTA, AN ITALIAN PASSION
Italy’s biggest pasta maker, Barilla, trumpets the country’s love of the food in a brochure it has published on its origins and popularity in which it calls pasta “An Italian passion.”
“Italy maintains the primacy as ‘The Pasta Country,’ with per capita consumption of 26 kg per year and product penetration of 99% of Italian households,” Barilla said. “On an international level, it is followed by Venezuela (12.3 kg of pasta consumed per capita), Tunisia (11.7 kg), Greece (10.6 kg) and Switzerland (9.2 kg). Italy is also the leader at the production level, with over 3.3 million tonnes a year, followed by the U.S. (2 million), Brazil (1.1 million), Russia (1 million) and Turkey (851,000).”
Barilla is among the world’s largest pasta producers, with a market share of 10.5%. It produces 1 million tonnes a year, including 150,000 kilometers of spaghetti a day at its Pedrignano plant. Barilla is followed in world market share by Spanish group Ebro Foods with a share of 5.5%, and Italy’s De Cecco with 2%.
HOSTILE TOWARD GM
Italy’s biotechnology industry is characterized as a dynamic and promising sector, despite the difficult economic situation that biotech companies have to confront on a daily basis, an attaché report published last year said.
“Italy has a large and profitable biotech industry operating in the medical, industrial and agricultural sector, ranking third in Europe in the number of pure biotech companies,” it said.
However, the sector, which comes behind Germany and the U.K. in size in Europe, is dominated by medical biotechnology.
“The general attitude toward GE crops in Italy remains hostile,” according to a separate attaché report focusing on agricultural biotech. “Italy’s debate between pro and anti-biotech parties continues without much progress. To date, Italy has deemed its ‘made in Italy’ campaign and its role as a leading organic crop producer as proscribing it from taking advantage of the gene revolution.”
Italy effectively bans the growing of biotech crops, despite European rules allowing some to be planted.
“The main farmer organizations are divided in their support of biotechnology,” the report noted. “While Coldiretti (the largest Italian Farmers’ Union) and CIA (the Italian Farmers’ Confederation) maintain strong anti-biotech attitudes, Confagricoltura (the General Confederation of Italian Agriculture) is calling for a more progressive position stressing the need for innovation and biotech research.
“Currently public opinion generally does not favor GE foods, making it politically difficult to allow the trade and planting of E.U.-approved GE crops. However, a growing number of Italian farmers and scientists have come forward in favor of the technology.”
According to a ministry of agriculture press release, Minister Maurizio Martina met regional agriculture representatives in April and supported a Greek proposal that E.U. member states should have more autonomy over whether genetically modified crops should be grown and marketed.
Although Italy is a significant maize producer, it has never commercially grown Bt corn and implements a national ban on MON 810 corn.
BREAKTHROUGH IN BIOFUELS
Italy has assumed a leading role in the biofuels sector with claims of a breakthrough, according to a report by the Financial Times in November.
“A locally led international consortium has achieved a breakthrough in what could lead to a “green revolution” in providing new fuels to cut carbon emissions,” it said. “A $150 million facility that opened recently in Crescentino is said to be the first in the world to produce ‘second-generation’ or advanced bioethanol on a commercial scale using enzymatic conversion. It uses agricultural waste and arundo donax, a fast-growing kind of bamboo, rather than scarce foodstuffs.”
The country has found a way of producing ethanol without grain or
“In Italy, about 30% of the bioethanol is produced from wine byproducts and about 10% directly from wine,” E.U.-based USDA attaches said in a report on biofuels in Europe. The report predicted 2014 Italian bioethanol consumption at 482 million liters, putting it well behind Germany, the U.K. and France. Italian biodiesel production is put at 570 million liters.
Sarah Mann, manager at the U.K.’s export promotion body British Cereal Exports, told World Grain that the country has faded as a market for wheat from the United Kingdom.
“They used to buy a lot of uks wheat (soft biscuit wheat) and when U.K. wheat got more expensive, they found other origins to use, Black Sea, for example, and Eastern Europe,” she said. “From the feedback we’ve had, it’s been mainly due to high prices rather than the quality of the wheat. I would hope that should the prices improve, that they would come back to us. They do continue to buy small amounts.”
Chris Lyddon is World Grain’s European editor. He may be contacted at: email@example.com.
Population: 61,680,122 (July 2013 est.)
Religions: Christian 80% (overwhelmingly Roman Catholic with very small groups of Jehovah’s Witnesses and Protestants), Muslim (about 800,000 to 1 million), Atheist and Agnostic 20%.
Location: Southern Europe, a peninsula extending into the central Mediterranean Sea, northeast of Tunisia.
Government: Republic. Chief of state: President Giorgio Napolitano (since May 15, 2006); head of government: Prime Minister Matteo Renzi (since Feb. 22, 2014).
Economy: Italy has a diversified industrial economy, which is divided into a developed industrial north, dominated by private companies, and a less-developed, highly subsidized, agricultural south, where unemployment is higher. The Italian economy is driven in large part by the manufacture of high-quality consumer goods produced by small and medium-sized enterprises, many of them family-owned. Italy also has a sizable underground economy, which by some estimates accounts for as much as 17% of GDP. These activities are most common within the agriculture, construction, and service sectors. Italy is the third-largest economy in the euro-zone, but its exceptionally high public debt and structural impediments to growth have rendered it vulnerable to scrutiny by financial markets. Public debt has increased steadily since 2007, topping 133% of GDP in 2013, but investor concerns about Italy and the broader euro-zone crisis eased in 2013, bringing down Italy’s borrowing costs on sovereign government debt from euro-era records. The government still faces pressure from investors and European partners to sustain its efforts to address Italy’s long-standing structural impediments to growth, such as labor market inefficiencies and widespread tax evasion. In 2013, economic growth and labor market conditions deteriorated, with growth at 1.8% and unemployment rising to 12.4%, with youth unemployment around 40%. Italy’s GDP is now 8% below its 2007 pre-crisis level.
GDP per capita: $29,600 (2013 est.); inflation: 1.2% (2013 est.); unemployment: 12.4% (2013 est.).
Currency: Euros (EUR): .7238 euros equal 1 U.S. dollar (April 17, 2014).
Exports: $474 billion (2013 est.): engineering products, textiles and clothing, production machinery, motor vehicles, transport equipment, chemicals; food, beverages and tobacco; minerals, nonferrous metals.
Imports: $435.8 billion (2013 est.): engineering products, chemicals, transport equipment, energy products, minerals and nonferrous metals, textiles and clothing; food, beverages, and tobacco.
Major crops/agricultural products: Fruits, vegetables, grapes, potatoes, sugar beets, soybeans, grain, olives; beef, dairy products, fish.
Agriculture: 2% of GDP and 3.9% of the labor force.
Internet: Code: .it; 25.662 million (2012) hosts and 29.235 million (2009) users.
Source: CIA World Factbook