The Italy Agribusiness Report features Business Monitor International's market assessment and independent 5-year forecasts covering the supply and demand outlook for the livestock, dairy, grains, rice, sugar, edible oils, coffee and cocoa sectors.

Business Monitor International's Agribusiness service also provides proprietary medium term price forecasts for key commodities, including corn, wheat, rice, sugar, cocoa, coffee, soy and milk; in addition to newly-researched competitive intelligence on leading agribusiness producers, traders and suppliers; in-depth analysis of latest industry developments; and essential industry context, such as the background macroeconomic outlook and the downstream supply chain.

Key Benefits

• Use BMI's independent 5-Year industry forecasts to test other views - a key input for successful planning in dynamic agribusiness markets.

• Apply BMI's medium term commodity price forecasts to assist with budgetary planning and the identification of investment opportunities and potential risks

• Exploit latest competitive intelligence on your competitors and peers in Asia, Europe, Latin America, the Middle East and Africa through our company rankings and analysis.

Executive Summary

Italy has a strong agricultural tradition and is the fifth largest exporter of agri-food products in the world. In BMI's new Italy Agribusiness Report for Q109, we examine how the industry has fared through the turbulent times of rapidly rising agricultural prices and input costs over the last two years and what challenges it will face moving into the next decade.

We expect moderate growth to 2012 across most of the sectors we forecast. Poultry and pork production will grow by 9.3% and 7.3%, respectively, although beef production will fall by 2.73%. The growth in poultry and pork production will be driven by domestic demand as Italy is now a net importer of both meats.

We do not see any expansion in milk production to 2012, although this could change depending on what decision is taken on EU milk quotas, which are due to expire in 2015. At present, it is looking likely that quotas will be gradually lifted up until that year to give a 'soft landing' to the EU dairy sector. The quotas have long been unpopular with Italian farmers, many of whom feel they lost out in the allocation as Italy's milk quota is less than half that of France. However, the abolition of quotas will bring threats as well as opportunities as it will allow larger, more efficient producers in other countries to increase production, ratcheting up competition.

We expect Italy's cheese production to grow by 18.4% to 2012, as demand on the home front and on export markets remains strong. In the first half of 2008, demand for one of Italy's most famous cheeses, buffalo mozzarella, was hit hard after it emerged that Naples' chaotic and corrupt waste disposal industry had allowed carcinogenic dioxins to get into buffalo feed and from there into their milk and cheese.

Rice will be an important export crop throughout our forecast period, with production growing 19.9% to 2012 to 1.79mn tonnes. With more than three-quarters of this forecast to be available for export, Italy will continue to supply a large portion of the rest of the EU's rice needs. Work is under way to produce new hardier varieties that will be more resistant to the changes in temperatures in north Italy where the majority of the country's rice is grown.

Italy's agriculture sector is still very fragmented by Western European standards - in 2005, according to data from Eurostat, small farms (from 5ha to 20ha) in Italy occupied more than three times as much land as in neighbouring France and almost six times as much land as in the UK. As quotas and subsidies from the EU are gradually withdrawn, many of these smaller operators may find it difficult to compete, driving consolidation in the sector.

Another option for smaller farms is organic farming. Demand for organically produced food has been increasing in Europe in recent years and in many cases has outpaced supply. In 2007, according to Eurostat, 8.4% of Italian agricultural land was classed as organic, the second highest proportion in the EU25 behind only Austria with 11.0%. As higher profit margins can be charged on organic produce, organic farming could be an option for smaller Italian farms to stay afloat in the face of competition from larger operators.

Executive Summary

SWOT Analysis

Italy Agricultural SWOT

Sub-sector Supply & Demand Analysis

Italy Grain Outlook

Table: Italy Wheat Production, Consumption & Trade Forecast Data

Table: Italy Corn Production, Consumption & Trade Forecast Data

Table: Italy Barley Production, Consumption & Trade Forecast Data

Table: Italy Wheat Production, Consumption & Trade Historical Data

Table: Italy Corn Production, Consumption & Trade Historical Data

Table: Italy Barley Production, Consumption & Trade Historical Data

Risks To Outlook

Italy Dairy Outlook

Table: Italy Milk Production, Consumption & Trade Forecast Data

Table: Italy Butter Production, Consumption & Trade Forecast Data

Table: Italy Cheese Production, Consumption & Trade Forecast Data

Table: Italy Milk Production, Consumption & Trade Historical Data

Table: Italy Butter Production, Consumption & Trade Historical Data

Table: Italy Cheese Production, Consumption & Trade Historical Data

Risks To Outlook

Italy Livestock Outlook

Table: Italy Poultry Production, Consumption & Trade Forecast Data

Table: Italy Pork Production, Consumption & Trade Forecast Data

Table: Italy Beef & Veal Production, Consumption & Trade Forecast Data

Table: Italy Poultry Production, Consumption & Trade Historical Data

Table: Italy Pork Production, Consumption & Trade Historical Data

Table: Italy Beef & Veal Production, Consumption & Trade Historical Data

Risks To Outlook

Italy Rice Outlook

Table: Italy Rice Production, Consumption & Trade Forecast Data

Table: Italy Rice Production, Consumption & Trade Historical Data

Risks To Outlook

Commodity Price Forecasts

Corn

Sugar

Milk

Rice

Wheat

Competitive Landscape

Table: Agricultural Commodity Producers & Traders

Table: Agribusiness Suppliers

Table: Integrated Agricultural Producers

Downstream Supply Chain Context

Food

Industry Forecast Scenario

Food Consumption

Table: Italy Food Consumption Indicators -- Historical Data & Forecasts

Trade

Table: Food & Drink Trade Balance -- Historical Data & Forecasts

Canned Food

Table: Canned Food Value/Volume Sales -- Historical Data & Forecasts

Confectionery

Table: Confectionery Value/Volume Sales -- Historical Data & Forecasts

Mass Grocery Retail

Industry Forecast Scenario

Table: Sales Value By Format In Italy's Mass Grocery Retail Market (US$mn)

Table: Sales Breakdown By Retail Format Type

Macroeconomic Context

Prepare For A Rough Ride

Table: Italy - Macroeconomic Forecasts

BMI Forecast Modelling

How We Generate Our Industry Forecasts