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Germany Agribusiness Report Q4 2009Published by: Business Monitor International Published: Oct. 5, 2009 - 48 Pages Table of Contents
AbstractBMI's Germany Agribusiness Report Q409 continues with many of the themes touched upon in previousreports, although with the recession lessening its grip on the economy, fundamentals look set for markedimprovements as we move into 2010.Germany is losing friends in response to the government's decision to ban the cultivation of GM corn.Agriculture Minister Ilse Aigner announced in April a U-turn on the cultivation of genetically modified(GMO) corn MON 810 in Germany on the grounds that it causes a pertinent environmental threat. Withthis, Germany has joined other EU countries such as France, Austria, Hungary, Luxembourg and Greece,which have also banned the crop, despite approval from the European Food Safety Authority for itscultivation. Regardless, the currently favourable price of corn against alternative grains has led to a robust plantingcampaign among domestic farmers supplying to the livestock and biofuel industries. We predict corn torecord the strongest production growth among grains of 58.20% over the entire outlook, although wheatwill post stronger year-on-year growth in 2010, of 10.3% to corn's 8.33%, before slowing considerably.Barley acreage is being rapidly substituted for more profitable crops, while livestock farmers importprotein-rich soymeal as a more favourable feed option. Barley production will contract by over 30% to2013 as this shift plays out. Cheese consumption is also robust, among the highest on the continent, with foreign varieties such asNorwegian Leerdammer and Dutch Edam becoming increasingly popular alongside traditional Germanvarieties. Strong production growth is expected to be outpaced by consumer demand, at 26.69% (thefastest growing household consumption good), as consumers continue to demand cheaper sources ofprotein in addition to comparatively expensive meat. Meanwhile, the demand for butter is predicted tosuffer from higher levels of consumer health-consciousness, coupled with the availability of numerousand less expensive substitutes. The issue of environmental sustainability has long been an important consideration for the Germaneconomy and issues pertaining to the use of harmful chemicals have become increasingly salient in recentmonths, while the government is trying to raise consumer sentiment relating to organic foods. Some feelthat Aigner's stance is based more on garnering political support than for the greater interests of thecountry, particularly prior to the European Parliamentary elections. What can be said is that, while sheseems increasingly determined to make Germany a GM free zone, this resolve will be challenged morethan ever in the forthcoming years as farmers seek to raise productivity to compensate for graduallydecreasing levels of farmer support. Get Full Details About This Report >> |
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