New Market Research Report: Italy Agribusiness Report Q4 2012

Fast Market Research recommends "Italy Agribusiness Report Q4 2012" from Business Monitor International, now available

by Bill Thompson

(WireNews+Co) - Boston, MA - 28 October 2012

BMI View: Our outlook for the grains and livestock has turned slightly bullish despite the problems caused by drought conditions in Europe. Our core scenario envisages a rebound in production of key grains (such as wheat, corn and barley), dairy products and poultry during 2012/13, mostly helped by favourable base effects. However, we warn of difficult times ahead for dairy and livestock farmers, whose margins are being squeezed by rising costs and as bleak economic prospects discourage consumption of value-added or more costly products such as cheese and beef.

Key Forecasts

- Wheat production growth to 2015/16: 8.5% to 7.4mn tonnes. Production is expected to rise as prices stay elevated, driven by growing demand for food and biofuels. Production of cellulosic ethanol, of which Italy is soon set to become a world leader, also will very likely help to boost wheat production.
- Cheese consumption growth to 2015/16: 17.8% to 1.7mn tonnes. Italian per capita cheese consumption, at 28.1kg, is on a par with France and Germany and higher than northern European countries such as Sweden and the UK.
- Poultry production growth to 2015/16: 17.8% to 1.4mn tonnes. Poultry is a relatively cheap meat and as such we expect continued strong demand amid the tough economic climate.
- 2012 real GDP growth: -1.6% (down from 0.5% in 2011)
- 2012 consumer price index: 1.7% ave (up from 2.9% in 2011)
- BMI universe agribusiness market value: 0.5% year-on-year (y-o-y) decline to US$17.7bn in 2011/12, forecast to grow on average 0.8% annually between 2012/13 and 2015/16.

View Full Report Details and Table of Contents (http://www.fastmr.com/prod/456345_italy_agribusiness_report_q4_2012.aspx) (http://www.fastmr.com/prod/456345_italy_agribusiness_report_q4_2012.aspx)

Industry Developments

The farm industry organisation Confagricoltura estimates that Italian farmers are set to face nearly EUR1bn in crop losses due to a heat wave and lack of rain. Although estimates for the exact loss are unavailable, Confagricoltura said that between 30% and 100% of the corn planted in non-irrigated fields is likely to be damaged. This adds to the woes the country's corn producers, who are already facing losses due to the 15-year ban on genetically modified maize.

Revised data indicate that wheat production levels in Italy were higher during 2010/11 and 2011/12 than originally estimated. Production grew 6.9% year-on-year, to 6.8mn tonnes, during 2010/11 (compared with earlier estimates of 6.5mn tonnes), while output reached 6.6mn tonnes in 2011/2012 (compared with estimates of a modest 6.2mn tonnes for the year). Likewise, we have revised up our forecast for 2012/13 and are now expecting production to surpass 7mn tonnes, growing by 6.2% y-o-y. In addition to the favourable base effects, growth will come on the back of a 15.0% increase in area planted and better yields as a result of satisfactory weather.

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