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  • DATA & TRENDS

    EUROPEAN FOOD AND DRINKINDUSTRY2014-2015

  • EU FOOD AND DRINK INDUSTRY FIGURES

    1,244 billionLargest manufacturing sector in the EU

    4.2 million peopleLeading employer in the EU

    1.8%of EU gross value added (GVA)

    CONSUMPTION

    14%of household expenditure on food and drink products

    EXTERNAL TRADE

    91.7 billionExports

    R&D EXPENDITURE

    2.8 billion64.1 billionImports

    27.6 billionTrade balance

    18%EU market share of global exports

    2013 data2012 data2014 dataFor definition, see page 23

    Sources: Eurostat, UN COMTRADE, OECD

    1

    2

    3

    4

    TURNOVER 1 VALUE ADDED 2

    4

    1

    EMPLOYMENT1 SMEs

    49.6%of food and drink turnover

    63.3%of food and drink employment

    2

    289,000NUMBER OF COMPANIES2

    3 2

  • INTRODUCTIONThis years edition of the Data & Trends of the European Food and Drink Industry report offers a comprehensive picture of the structure and economics of Europes food and drink sector.

    The EU food and drink industry is a key pillar of the EU economy, outperforming a large number of other EU manufacturing sectors. It is the largest manufacturing industry in the EU in terms of turnover, value added and employment. The Data & Trends report provides in depth analysis of the EU single market, world markets, and a European and global ranking of food and drink companies.

    This report covers the whole EU-28 food and drink industry, which is identified by the NACE rev2 codes C10 (food products) and C11 (drinks).

    CONTENTS

    EU single marketContribution to the EU economy

    Employment

    Small and medium-sized enterprises

    Sub-sectors at EU level

    Sub-sectors at national level

    The national picture

    R&D and innovation

    Consumption

    Food supply chain

    EU food and drink industry figures01 World marketsTrade figures

    Trade figures by sub-sector

    2015 trade trends

    EU food and drink market share

    Food and drink industries worldwide

    Global trends in R&D

    Future challenges and opportunities

    Key food and drink companies

    Glossary23

    Flash the code below for the interactive content of the report

    Global ranking

    European ranking030506070809101112

    13151617181920

    2122

  • 03 EU single market

    EU single market

    CONTRIBUTION TO THE EU ECONOMYThe largest manufacturing sector in terms of turnover, value added and employment

    The food and drink industry is a major contributor to Europes economy, ahead of other manufacturing sectors, such as the automotive industry.

    The industry maintains the characteristics of a stable, resilient and robust sector.

    In 2014, the production of the sector was higher than any previous annual production since 2008.

    The EU food and drink industry turnover exceeded 1.2 trillion (2013) and value added reached 206 billion (2012).

    1.8%Contribution of the food and drink industry to EU gross value added (GVA)

    12.8%Share of food and drink value added in manufacturing

    15%Share of food and drink turnover in manufacturing

    Recent developments in turnover, value added and employment

    For definition, see page 23

    % change 2012-2013

    2012

    289

    4.25

    206

    1,062

    2013

    -

    4.22

    -

    1,244

    -

    -0.6

    -

    17.1

    Value added ( billion)

    Turnover ( billion)

    Number of employees (million)

    Number of companies (1,000 units)

    Sources: Eurostat (SBS), FoodDrinkEurope calculations

    1

    1

  • 04 EU single market

    Production in the EU manufacturing industry (2008-2014)

    Pharmaceutical

    Food and drinkAutomotive

    Machinery and equipment

    Manufacturing

    Contribution of the food and drink industry to the EU economy (2012,%)

    1.8%Food and drink manufacturing industry

    3.9Other industries

    13.4Other manufacturing industries

    19.316.65.9 1.7

    37.5

    Financial and real estate activitiesConstruction

    Public services

    Services and cultureAgriculture

    19.1Industry

    Source: Eurostat (SBS)

    Source: Eurostat (STS)

    Share of value added in the EU manufacturing industry (2012,%)

    12.8%Food and drink products

    Fabricated metal products11.89.89.3 Automotive

    Machinery and equipment

    Others56.3

    Source: Eurostat (SBS)

    Share of turnover in the EU manufacturing industry (2012,%)

    15%Food and drink products

    129.78.9

    AutomotiveCoke and petroleum products

    Machinery and equipmentOthers54.4

    Source: Eurostat (SBS)

    2008 2009 2010 2011 2012 2013 2014

    % c

    hang

    e

  • -2

    0

    2

    4

    6

    8

    10

    12

    2007 2008 2009 2010 2011 2012 2013 2014

    % c

    ha

    ng

    e

    05 EU single market

    Average number of persons employed per company (2012)

    1184131149

    ChemicalsAutomotive

    Machinery and equipment

    Fabricated metal productsManufacturing

    16Food industry

    EMPLOYMENTLeading employer in the EU

    Compared to other manufacturing sectors, the EU food and drink industry is a key job provider and a relatively stable employer.

    On average, labour productivity in the food and

    drink industry is lower than in most manufacturing sectors.

    4.2 millionTotal number of employees

    Employment in the EU manufacturing industry

    Food and drink products

    ManufacturingAutomotive

    Pharmaceutical productsMachinery and equipment

    15%Food and drink products

    Share of employment in the EU manufacturing industry (2012,%)

    Fabricated metal products

    AutomotiveMachinery and equipment

    Others

    11.610.1 8

    55.3

    Source: Eurostat (SBS)

    Sources: Eurostat (STS), FoodDrinkEurope calculations Source: Eurostat (SBS)

    15%Share of food and drink industry employment in manufacturing

    Labour productivity (2012, 1,000/person)

    92

    ChemicalsAutomotiveMachinery and equipment

    Fabricated metal productsTextiles

    Manufacturing

    Food and drink products

    46

    66

    54

    44

    35

    Source: Eurostat (SBS)

    65

    For definition, see page 231

    1

  • 06 EU single market

    Contribution of SMEs and large companies to the EU food and drink industry (2012,%)

    Large companies

    SMEs

    SMEs in the EU food and drink industry (2012,% by company size)

    Value addedTurnover

    Number of employeesNumber of companies

    Micro-companies(0-9 employees)

    Small companies(10-19 employees)

    Small companies(20-49 employees)

    Medium-sized companies(50-249 employees)

    6.5

    8.4

    15.4

    78.8

    5.1

    6

    9.9

    10.9

    9.6

    8.9

    11.9

    5.7

    28.5

    24.8

    26.1

    3.7

    SMALL AND MEDIUM-SIZED ENTERPRISES

    The food and drink industry is a highly diversified sector with many companies of different sizes.

    SMEs generate almost 50% of the food and drink industry turnover and value added and provide two thirds of the employment of the sector.

    The food and drink industry counts more than 280,000 SMEs.

    49.6%Turnover of food and drink

    turnover

    528 billion

    2.9 millionEmployees

    99 billionValue added

    48.1%of food and drink value added

    63.3%of food and drink employment

    99.1%of food and drink companies

    Value addedTurnover Number of employees

    49.6

    50.4

    48.151.9

    63.3

    36.7

    Number of companies

    99.1

    0.9

    Sources: Eurostat (SBS), FoodDrinkEurope calculations

    Source: Eurostat (SBS)

    For definition, see page 231

    Key role of SMEs 1

  • 07 EU single market

    SUB-SECTORS AT EU LEVEL

    A diverse food and drink industry

    Turnover, value added, number of employees and companies in food and drink industry sub-sectors (2012,%)

    Labour productivity (2012, 1,000/person)

    8978

    71 67 6253 50

    35 3326

    The EU food and drink industry is diverse, with a variety of sectors ranging from fruit and vegetable processing to dairy production and drinks.

    The top 5 sub-sectors (bakery and farinaceous products, meat sector, dairy products, drinks and various food products category) represent three quarters of the total turnover and more than 80% of the total number of employees and companies.

    Labour productivity varies by sub-sector. For drinks, animal feeds and various food products it is higher than for overall manufacturing.

    20%

    32%Share of the meat sector turnover

    Share of employees working in the bakery and farinaceous sector

    Meat productsVarious food productsDrinks

    Bakery and farinaceous productsAnimal feeds

    Dairy products

    Oils and fatsGrain mill and starch products

    Processed fruits and vegetables

    Fish products

    Turnover Value added

    20

    Number of employees Number of companies

    16

    1413

    11

    7

    6

    54 2

    21

    19

    18

    15

    10

    6

    53 2 2

    32

    2114

    9

    8

    63

    23 12 234

    54

    14

    9

    8

    4

    1

    Sources: Eurostat (SBS), FoodDrinkEurope calculationsFor definition, see page 231

    1

    Food and drinkindustry

    Manufacturing

  • 06 SMEs08 EU single market

    SUB-SECTORS AT NATIONAL LEVEL

    Top 3 sub-sectors by production value in EU Member States (2012, billion)

    Austria

    Belgium

    Croatia

    Czech Republic

    Denmark

    Finland

    France

    Germany

    Greece

    Hungary

    Ireland

    Italy

    Netherlands

    Poland

    Portugal

    Romania

    Spain

    Sweden

    United Kingdom

    1 2 3

    5.3

    6.6

    1.0

    2.5

    6.2

    2.5

    32.6

    44.4

    2.5

    2.4

    4.9

    22.8

    9.7

    12.9

    2.8

    2.5

    20.4

    3.9

    20.7

    3.8

    4.6

    0.8

    2.3

    5.7

    2.3

    26.1

    24.4

    1.9

    1.6

    3.7

    17.6

    8.8

    7.1

    2.0

    2.2

    15.4

    2.6

    19.7

    2.3

    4.4

    0.6

    1.6

    1.9

    1.2

    24.3

    21.9

    1.7

    0.9

    2.9

    17.6

    7.3

    6.1

    1.5

    1.2

    9.7

    1.9

    11.9

    Meat products

    Drinks

    Bakery and farinaceous products

    Animal feeds

    Dairy products

    Oils and fats

    Sources: Eurostat (SBS), FoodDrinkEurope calculations

  • THE NATIONALPICTURE

    A key industry in the economies of EU Member States

    #1 employer

    66%

    The food and drink industry is the biggest employer inmanufacturing in more than half of the Member States

    Share of turnover of the EUs 5 largest food and drink producers

    The food and drink industry ranks among the top three manufacturing industries in terms of turnover and employment in most Member States.

    Germany, France, Italy, the UK and Spain are the

    largest EU food and drink producers by turnover.

    The industry is an essential part of national economies. The share of the food and drink industry employment exceeds 15% in more than half of the Member States.

    09 EU single market

    Or by EurostatCompanies with more than 10 employees2012 dataSmall food and drink producers excludedCompanies with more than 20 employees

    1

    2

    3

    4

    5

    Food and drink industry data as published by FoodDrinkEurope National Federations (2013)1

    AustriaBelgiumBulgariaCroatiaCzech RepublicDenmarkEstoniaFinlandFranceGermanyGreeceHungaryIrelandItalyLatviaLithuaniaNetherlandsPolandPortugalRomaniaSlovakiaSloveniaSpainSwedenUnited Kingdom

    Employment ranking

    in manufacturing

    Value added ( billion)

    Turnover ( billion)

    Number of employees

    (1,000)

    Number of companies

    -121422313121311111133141

    20.348.2

    4.95.2

    13.824.6

    1.811.3

    158.9175.214.511.4

    26.4132.0

    1.34.0

    62.455.214.911.24.52.1

    91.519.5

    113.6

    5.17.40.81.22.33.02.52.5

    10.834.2

    1.52.47.6

    22.10.30.6

    13.310.02.61.90.70.4

    28.44.6

    31.0

    64.088.894.362.9

    100.453.014.333.5

    492.2555.3

    78.094.039.2

    385.026.242.8

    133.0419.8107.0183.128.015.9

    447.850.5402

    3,8184,6385,8333,2408,415

    630490

    1,76915,7885,9201,3206,574

    607 6,850

    9591,4685,03514,21810,4218,5662,7661,938

    27,1193,7846,020

    3

    3

    3

    3

    3

    3

    3

    3

    3

    2

    2

    4

    4

    4

    5

    4

    3

  • 06 SMEs10 EU single market

    R&D AND INNOVATION

    Consumer expectations driving innovation

    Drivers of innovation can be divided into 15 trends, grouped along five axes, corresponding to general consumer expectations: pleasure, health, physical, convenience and ethics.

    Pleasure, including variety of senses and sophistication, is by far the leading axis with a 56% share in 2014.

    The soft drink sector is the leader in innovation in 2014, pushing dairy products to second place. Savoury frozen products follow, ranking third.

    Pleasure

    #1

    Leading driver of food innovation

    Soft drinks is the most innovative food sector in Europe

    Food innovation trends in Europe (2013-2014,%)

    Drivers of innovation in Europe (2013-2014,%)

    Pleasure

    Health

    Convenience

    Physical

    Ethics

    57.156.3

    17.818.1

    17.618.9

    6.15.7

    1.41.0

    2013

    2014

    Variety of senses

    Sophistication

    Easy to handle

    Natural

    Medical

    Time saving

    Fun

    Slimness

    Exoticism

    Nomadism

    Energy, well-being

    Vegetal

    Solidarity

    Ecology

    Cosmetic

    30.129.5

    19.119.4

    11.312.9

    8.910.3

    7.96.9

    4.44.44.64.44.5

    4.23.33.0

    1.81.51.41.40.90.90.60.50.80.50.20.1

    The 15 most innovative food sectors in Europe (2014,% of total European food innovation)

    Soft drinks

    Dairy products

    Savoury frozen products

    Ready made meals

    Appetiser grocery products

    Biscuits

    Alcoholic beverages, appetisers

    Chocolate products

    Condiments and sauces

    Cheeses

    Desserts

    Beers, ciders

    Ice-creams

    Cereals

    7.2

    Meat, delicatessen, poultry

    6.9

    6.2

    6.1

    5.3

    4.9

    4.9

    4.3

    3.8

    3.6

    3.4

    3.1

    2.7

    2.6

    2.5

    Exoticism

    Sophistication

    Fun Vegetal Slimness CosmeticsTime saving Solidarity

    Variety of senses Natural Medical

    Energy, well-being

    Easy to handle

    Nomadism Ecology

    Pleasure Health Physical Convenience Ethics

    Food innovation trends in Europe

    Source: XTC World Innovation Panorama 2015 Copyright XTC 2015, www.xtcworldinnovation.com

  • CONSUMPTIONFood and drink products: the second largest household expenditure

    In 2013, the share of household expenditure on food and drink products remained stable compared to the previous year.

    Across EU Member States, household expenditure on food and drink products varies from 11% to 32%.

    Since 2010, food manufacturing prices have risen at a lower rate than agricultural prices. Food manufacturing prices reflect agricultural raw material prices and other input costs.

    Over the past 5 years, food prices paid by consumers (i.e. retail prices) have grown by 2% per year on average, in line with inflation.

    14%

    1,066 billion

    Share of EU household expenditure on food and drink products

    EU household expenditure on food and drink products

    11 EU single market

    Household consumption expenditure on food and drink products by Member State (2013,% of total expenditure)

    Latvia

    Romania

    Estonia

    Poland

    32

    29

    27

    26

    21

    21Hungary

    21 Bulgaria

    20 Slovakia

    19

    Czech Republic

    19Portugal

    18 Greece

    Slovenia 17

    16 Cyprus

    16 Finland

    15Italy

    15France

    15 Croatia

    15Belgium

    15Malta

    14Sweden

    14

    Spain

    13Ireland13Denmark

    13Netherlands12

    GermanyLithuania

    Austria 11Luxembourg 11

    11United Kingdom

    14%Food and drink products

    Price developments in the food chain (price indices, 2010=100)Breakdown of EU household consumption expenditure (2013,%)

    Housing, water and energy2513

    9 Recreation and cultureTransport

    Restaurants and hotels8Others31

    Source: Eurostat (National accounts)

    Sources: Eurostat (National accounts), FoodDrinkEurope calculations

    Sources: Eurostat (Prices) and DG Agriculture and Rural Development

    2010 2011 2012 2013 2014

    100

    120

    140

    InflationAgricultural pricesFood manufacturing pricesFood consumer prices

  • 12 EU single market

    FOOD SUPPLY CHAIN

    In 2012, there were 24 million people employed in the food supply chain.

    The total turnover exceeds 3.8 trillion and value added almost reaches 680 billion.

    Around 31 million professionals work in the extensive food supply chain across the EU, from agriculture and the input industry to food and drink services.

    11%

    6%

    Share of the food supply chain in EU employment

    Share of the food supply chain in EU gross value added

    Driving forces in the food supply chain: agriculture, the food and drink industry, wholesale and retail

    Wholesale of agricultural and food productsFood and drink retail

    Agriculture

    Employment in the extensive food supply chain (2012,%)

    Wholesale of agricultural and food productsFood and drink retail

    Food and drink industryAgriculture

    Turnover, value added, employees and companies in the food supply chain (2012,%)

    33

    Turnover Value added Number of employees Number of companies

    15 8 2

    29 24 26 6

    2

    8948

    18

    31

    302811

    Input industry

    Food and drink services

    Structural overview of the food supply chain (2012)

    Value added ( billion)Turnover ( billion)

    Number of employees (million)

    Number of companies (1,000 units)

    Agriculture

    12,248

    11.6208409

    Food and drink industry

    2894.3

    2061,062

    Wholesale of agricultural and food products

    Food and drink retail

    3382

    104

    1,255

    822

    6.2160

    1,132

    Source: Eurostat (National accounts, SBS, FSS, Economic Accounts for Agriculture)2010 data1

    1

    1

    14%Food and drink industry

    6 20

    38 1

    21

  • 13 World markets

    World markets

    TRADE FIGURESRecord trade surplus of 27.6 billion

    EU food and drink exports doubled over the past decade to reach 91.7 billion in 2014.

    More than one quarter of European food and drink exports are sold to non-EU countries and at a growing rate. EU exports to most key markets increased in 2014, with the exception of Russia.

    EU food and drink imports increased by a moderate 2% in 2014, in value and volume.

    NAFTA remains by far the EUs largest trading partner by region, followed by EFTA, ASEAN, the ACP group of countries and Mercosur .

    28%72%

    Extra EU exports

    Intra EU exports

    Evolution of EU food and drink trade balance (2010-2014, billion)

    91.7 billionExports

    64.1 billionImports

    331.4 billion

    Total intra and extra EU exports of food and drink products (2014)

    0

    20

    40

    60

    80

    100

    2010 2011 2009 2010 2011 2012 2013 2014

    Trade surplus

    Imports

    1

    1

    2

    Exports and imports refer to extra EU trade, unless otherwise specified

    For definition, see page 232

    1

    Sources: Eurostat (Comext), FoodDrinkEurope calculations

  • 14 World markets

    EU food and drink trade by region (2014, million)

    ExportsImports

    Total trade

    NAFTA18,068

    6,13924,207

    EFTA8,6887,003

    15,690

    CIS 7,653 1,752

    9,404

    Balkans 1,985 947

    2,932

    ASEAN 5,769

    9,75715,526

    ACP 8,5205,363

    13,882

    Mediterranean countries

    5,4332,019

    7,452

    GCC 5,313 42

    5,355

    Andean Group 547

    1,992 2,538

    MERCOSUR 1,96111,957

    13,919

    Top EU trading partners (2014, million)

    Exports ImportsUS14,566

    Russia6,335

    Norway3,146

    China5,583

    Switzerland5,304

    Japan4,607

    Hong Kong3,662 Canada

    2,592

    Saudi Arabia2,219

    Australia2,348

    Brazil6,706

    US4,853

    Thailand2,549

    Argentina4,341

    Switzerland4,137

    China3,655

    Indonesia3,647 Turkey

    2,505

    Malaysia1,765

    Norway1,989

    Sources: Eurostat (Comext), FoodDrinkEurope calculations

  • 15 World markets

    TRADE FIGURESBY SUB-SECTOR

    Top 3 best performing exports: dairy products +10%, chocolate and confectionery +9%, grain mill and starch products +9%.

    Top 3 best performing imports: chocolate and confectionery +17%, dairy products +10%, prepared animal feeds +10%.

    The combined exports of European drinks, dairy and meat products totalled 47.8 billion in 2014.

    51%

    61%

    Combined export market share of the drinks, dairy and meat product sectors

    Combined import market share of oils and fats, fish and seafood products, processed fruits and vegetables

    Diversity of EU food and drink trade

    Export market share by sector (2014,%) Exports and imports by sector (2014, million)

    Drinksof which: spirits wine mineral waters and soft drinksVarious food productsof which: chocolate and confectionery processed tea and coffeeMeat productsDairy productsProcessed fruits and vegetablesOils and fatsPrepared animal feedsBakery and farinaceous productsFish and seafood productsGrain mill products and starch products

    Exports Imports

    2014

    25,8829,6309,0162,934

    21,3395,6992,017

    10,85711,0475,4784,8003,1643,8873,511

    3,073

    5,0761,3622,442

    87210,3892,6892,0076,949

    8718,254

    16,708869667

    16,5911,747

    28

    12 12

    6 5

    4 4

    3 3

    2014

    -4

    % change 2013-2014

    -2

    -2

    -6

    2

    9

    9

    10

    7

    7

    5

    3

    9

    -1

    -2

    -1

    -1

    1

    4

    17

    3

    10

    5

    10

    6

    6

    6

    % change 2013-2014

    23

    DrinksVarious food products

    Meat productsDairy products

    Processed fruits and vegetablesOils and fatsBakery and farinaceous productsFish and seafood products

    Prepared animal feedsGrain mill and starch products

    Sources: Eurostat (Comext), FoodDrinkEurope calculations

  • 16 World markets

    2015 TRADE TRENDSHighest first quarter exports

    During the first quarter of 2015, EU food and drink exports increased by 6%, compared to the same quarter in 2014 and exceeded the level of the previous five years.

    The top 3 best performing exports include: food preparations, meat products, oils and fats.

    Imports of chocolate and confectionery products, as well as processed fruits and vegetables, increased most significantly.

    +37%

    22.8 billionExport growth of EU food preparations

    First quarter EU food and drink exports

    2015

    Trade exports and imports (Q1 2015, million)

    Q1 2014 Q1 2015Exports % change 2014-201510

    -13

    37

    9

    9

    9

    10

    10

    5

    2

    Meat productsDairy products

    Spirits

    Wine

    Processed fruits and vegetables

    Oils and fats

    Chocolate and confectionery

    Food preparations

    Bakery and farinaceous products

    Prepared meals and dishes

    2,4042,8381,9681,8991,3091,1951,237

    731856867

    2,6372,4752,1382,0671,4311,3091,2931,001944888

    Fish and seafood products

    Processed tea and coffee

    Grain mill and starch products

    Sugar

    Q1 2014 Q1 2015Imports

    Meat products

    Spirits

    Wine

    Processed fruits and vegetables

    Oils and fats

    Chocolate and confectionery

    3,7573,8501,9431,651

    631538476436589302

    4,1133,9872,1891,793

    738577517459385311

    -35

    9

    9

    3

    17

    5

    4

    13

    7

    9

    % change 2014-2015

    Trends in EU food and drink exports (2010-2015, billion)

    20102011201220132014

    4

    5

    6

    7

    8

    9

    Q1 Q2 Q3 Q4

    Sources: Eurostat (Comext), FoodDrinkEurope calculations

  • EU FOOD AND DRINK MARKET SHARE

    Worldwide, total exports almost tripled in the period 2003-2013.

    The EU remains the worlds largest exporter of food and drink products ahead of the US, China and Brazil.

    EU share in global food and drink exports is currently below the 2003 level, but recovering from a low in the 2010-2013 period.

    The EU ranked as the second largest importer just after the US, followed by Japan, China and Russia.

    EU market share in Chinas food imports recorded steady growth over the past decade.

    14%EU share in global food and drink imports

    18%EU share in global food and drink exports

    Number 1 exporter and number 2 importer of food and drink products in the world

    17 World markets

    Share in global food and drink exports(2003-2013,%)

    20

    20032013

    European Union

    US

    China

    Canada

    Brazil

    India

    Thailand

    Indonesia

    Argentina

    18

    13 12

    6 7

    6 7

    5 4

    2 4

    2 5

    4 4

    3 3

    Market share of Chinas food and drink imports (2003-2013,%)

    EU evolutionary

    US

    New Zealand

    Indonesia

    Malaysia

    Australia

    Sources: UN COMTRADE, FoodDrinkEurope calculations

    Market share of US food and drink imports (2003-2013,%)

    EU evolutionary

    Canada

    Mexico

    China

    Australia

    Thailand

    0

    5

    10

    15

    20

    25

    30

    2003 2005 2007 20112009 2013

    0

    4

    8

    12

    20

    16

    2003 2005 2007 20112009 2013

  • 18 World markets

    FOOD AND DRINKINDUSTRIES WORLDWIDE

    Top 3 food and drink producers: the EU, the US and China

    The global comparison shows that the EU food and drink industry plays a key role in terms of turnover, employment and total number of companies.

    The EU ranks sixth in terms of contribution of food

    and drink manufacturing to total manufacturing turnover, behind New Zealand, Australia, Brazil, Canada and Russia.

    China heads up the ranking as the country with the largest number of food and drink manufacturing companies (400,000).

    The global trust in the food and drink industry is significantly higher than trust in business.

    #1

    Trust

    The EU is the leading food and drink producer in terms of turnover

    The food and drink industry is more trusted than business worldwide

    Distribution of turnover, number of employees and companies in food and drink industries worldwide (2012/2013)

    EUChinaUSJapanBrazilMexicoRussiaIndiaCanadaAustraliaSouth KoreaNew Zealand

    1,244767578466169102999572623227

    Turnover ( billion)

    Employees (1,000)

    Number of companies

    % of total manufacturing turnover

    151113122212159

    1623

    647

    4,2206,7401,4141,4271,626

    7931,3001,700

    28822017981

    289,000400,000

    25,79859,45832,000

    170,00043,01636,8816,5267,507

    23,9293,302

    Glo

    bal

    US

    Braz

    il

    Irela

    nd UK

    Swed

    en

    Net

    herla

    nds

    Ger

    man

    y

    Fran

    ce

    Spai

    n

    Italy

    Pola

    nd

    Turk

    ey

    Russ

    ia

    S. A

    frica

    UA

    E

    Indi

    a

    Chin

    a

    Trust in the food and drink industry vs. business worldwide (2014,%)

    62

    48

    68

    51

    73

    59 60

    36

    68

    44 48 46

    65 57 55

    42

    57

    30

    58 62 68

    79

    65 77

    56

    71

    37 45

    32 43

    36

    51 48

    63

    36

    61

    Food and drink industryBusiness

    Source: Edelman Trust Barometer

    1

    1 2

    2011 data 2009 data12

    Source: FoodDrinkEurope compilation, based on official national statistics and industry reports

  • 19 World markets

    GLOBAL TRENDSIN R&D

    Out of the top 2,000 leading companies worldwide in R&D, 59 operate in the food and drink sector. Together, these companies invested 8.6 billion in R&D in 2013, 2.6 billion out of which were invested by 16 food and drink companies based in the EU.

    Distribution of the 16 EU food and drink companies: The Netherlands and United Kingdom 4; Germany 3; France 2; Denmark, Belgium and Ireland 1.

    The EU food and drink industry has a lower R&D investment intensity compared to other food and drink industries worldwide.

    R&D investment intensity varies within the EU, with higher levels in Northern countries.

    0.27%EU R&D private investment as a share of food and drink output

    Sustained levels of R&D investment

    R&D private investment in the food and drink industry listed in the worlds top 2,000 companies (2013)

    US

    R&D investment

    ( billion)

    EU

    Switzerland

    Japan

    South Korea

    New Zealand

    Share of world regions

    (%)

    Number ofcompanies

    15

    16

    2

    19

    Private investment of the food and drink industry in R&D as a percentage of output in the EU (2010-2012,%)

    201220112010

    Private investment of the food and drink industry in R&D as a percentage of output (2012,%)

    Norway

    0.73

    0.57 0.53

    0.36 0.27

    Total

    33.1

    30.5

    16.6

    15.6

    100 59

    Source: The 2014 EU Industrial R&D Investment Scoreboard, JRC

    Sources: OECD STAN and Eurostat (National Accounts), FoodDrinkEurope calculations

    1.7

    1

    0.1

    2.8

    2.6

    1.4

    1.3

    3

    1.6 0.1

    8.6

    1

    1

    2

    Netherlands

    United Kingdom

    Finland

    Belgium

    France

    Denmark

    Portugal

    Ireland

    Sweden

    Germany

    Slovenia

    Spain

    Austria

    Hungary

    Italy

    Greece

    Estonia

    Czech Republic

    Poland

    Romania

    Slovak Republic

    EU2

    Including tobaccoData refer to 21 of the 28 EU Member States2009 data for Japan, 2010 for Korea and the US

    1

    2

    3

    EU2Korea 3Japan3 US30.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8

  • 20 World markets

    FUTURE CHALLENGESAND OPPORTUNITIESTrends and players driving change worldwide

    In 1960, one hectare of land fed 2 people while in 2050 one hectare of land will be required to feed 5 people.

    Natural resources, upon which food production relies, will come under increased pressure in the future to meet a growing demand for food worldwide.

    Climate change increases the likelihood of more extreme temperatures and unpredictable weather events, which affect food production.

    By 2030 China is expected to overtake the US and become the largest economy in the world.

    In 2050 the top three economies in the world (China, the US and India) will each be richer than the next five (Indonesia, Japan, Germany, Brazil and Mexico) put together.

    60%Increase in global demand for food by 2050

    9 billionGlobal population in 2050

    Top 10 economies in 2050 (nominal GDP, $ billion)

    +60%Demand for food by 2050

    +45%Demand for energy by 2030

    +30%Demand for water for agriculture by 2030

    Future global challenges (% increase)

    Ranking in 2014

    2105,916 China

    US

    India

    Indonesia

    Japan

    Germany

    Brazil

    Mexico

    UK

    France

    70,913

    63,842

    15,432

    11,367

    11,334

    10,334

    9,826

    9,812

    9,671

    1

    9

    16

    3

    4

    7

    15

    6

    5

    Arable land per capita (hectares in use per person)

    World

    Developed countries

    Developing countries

    0.44 0.24 0.20 0.18

    0.32 0.19 0.15 0.14

    0.67 0.46 0.42 0.41

    1960 2005 2030 2050

    Past and projected global temperature change

    Scenarios

    Observed

    Very high GHG emissions

    Below 2C increase

    Source: The Economist Intelligence Unit

    Sources: The Future of Food and Farming (2011), FAO and Foresight

    Source: World agriculture towards 2030/2050: the 2012 revision, FAO

    Source: Climate Change 2014: Synthesis Report, IPPCAt market exchange rates1

    1

    1900 1950 2000 2050 2100

    6

    4

    2

    0

    2

    (C

    re

    lati

    ve t

    o 1

    98

    6

    20

    05

    )G

    loba

    l mea

    n te

    mpe

    ratu

    re c

    hang

    e

  • KEY FOOD AND DRINK COMPANIESThe EU food and drink industry is comprised of large companies and SMEs. Large companies account for 50.4% of EU food and drink turnover, 51.9% of value added and 36.7% of employment in the sector.

    Ranking of global agri-food companies by global food and drink sales

    Name Headquarters Main sectors

    CargillNestlPepsiCo, Inc.BungeJBSAnheuser-Busch InBevThe Coca-Cola CompanyArcher Daniels Midland CompanyTyson FoodsDuPontMondelez InternationalMarsUnileverHeinekenDanoneSuntorySABMillerLactalisGeneral Mills Inc.FonterraKraft Foods GroupKirin HoldingsConAgra Foods Inc.Asahi GroupDiageoRoyal FrieslandCampina

    USCH USUSBRUSUSUSUSUSUSUS

    NL/UKNL FRJP

    USFRUSNZUSJP

    USJP

    UKNL

    99.7175.4149.9542.8138.6035.2534.4532.3827.6126.0125.6524.7221.5321.1921.1417.5017.2416.0013.7713.7113.6413.1613.11

    12.7312.2911.30

    multi-productmulti-product

    beverages, snacksmulti-product

    meat, dairy beer

    beveragescereal processing

    meatmulti-product

    confectionery, snacks, dairyprepared foods, confectionery

    multi-productbeer

    dairy, water, baby & medical nutritionalcoholic beverages

    beerdairy

    prepared foodsdairy

    multi-productbeer, alcoholic beverages

    prepared foodsbeer, alcoholic beverages

    alcoholic beveragesdairy

    21 Key food and drink companies

    Figures have been converted to Euro with ECB bilateral annual exchange rates series, but only figures in the original currency are relevant1

    Sales ( billion)1

  • Ranking of European agri-food companies by global food and drink sales

    Name Headquarters Main sectors

    NestlUnileverHeinekenDanoneLactalisDiageoRoyal FrieslandCampinaArla FoodsDSMCarlsbergFerreroAssociated British FoodsPernod RicardDanish CrownSdzuckerKerry GroupParmalatOetker GroupRed BullVionBarry CallebautAgrokorBongrain / SavenciaTereosLVMHTate & Lyle

    CH NL/UK

    NL FRFR

    UKNLDK NLDK

    ITUKFR

    DK DEIEIT

    DEATNLCHHRFRFRFR

    UK

    75.4121.5321.1921.1416.0012.2911.3010.619.188.658,408.137.957.786.015.765.555.255.11

    4.994.804.674.614.303.973.82

    multi-productmulti-product

    beerdairy, water, baby & medical nutrition

    dairy alcoholic beverages

    dairydairy

    multi-productbeer

    confectionerysugar, starch, prepared foods

    alcoholic beveragesmeat

    sugar, multi-productmulti-product

    dairy, fruit beveragesmulti-product

    beveragesmeat, ingredients

    chocolatemulti-product

    dairysugar, multi-product

    multi-productmulti-product

    22 Key food and drink companies

    Figures have been converted to Euro with ECB bilateral annual exchange rates series, but only figures in the original currency are relevant1

    Sales ( billion)1

  • GLOSSARYAbbreviation of world regions

    ACPAfrican, Caribbean and Pacific group of countries

    Andean GroupBolivia, Colombia, Ecuador, Peru and Venezuela

    ASEAN (Association of Southeast Asian Nations)Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam

    BalkansAlbania, Bosnia-Herzegovina, Kosovo, F.Y.R.O.M , Montenegro and Serbia

    CIS (Commonwealth of Independent States)Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan and Ukraine

    EFTA (European Free Trade Area)Iceland, Liechtenstein, Norway and Switzerland

    GCC (Gulf Cooperation Council)Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates

    MercosurArgentina, Brazil, Paraguay, Uruguay and Venezuela

    NAFTA (North American Free Trade Agreement)Canada, Mexico and the US

    23 Glossary

    EUFor trade data (pages 13 to 18), EU refers to the European Union as follows: EU-15 from 1995, EU-25 from 2004, EU-27 from 2007, EU-28 from 2013.

    For other pages, EU refers to the 28 Member States.

    Gross value added (GVA)The gross value added is the value of goods and services produced by a sector minus the cost of the raw materials and other inputs used to produce them. GVA measures the contribution to the economy of each individual sector.

    Labour productivityLabour productivity is calculated as the gross value added (GVA) divided by the employed population. Labour productivity provides a measure of the efficiency of the workforce to produce goods and services.

    Small and medium-sized enterprises (SMEs) From Eurostats Structural Business Statistics database: micro = less than 10; small = 10 to 49; medium-sized = 50 to 249; large = more than 250 employees (the SBS size-class data are solely based on the definition relating to the number of employees and not to the turnover level).

    Value added The value added at factor costs is the gross income from operating activities after adjusting for operating subsidies and indirect taxes.

    It can be calculated as the total sum of items to be added (+) or subtracted (-): turnover (+); capitalised production (+); other operating income (+); increases (+) or decreases (-) of stocks; purchases of goods and services (-); other taxes on products which are linked to turnover but not deductible (-); duties and taxes linked to production (-).

  • FoodDrinkEuropeAvenue des Nerviens 9-311040 Brussels, BelgiumTel: +32 2 514 11 [email protected]

    Published in September 2015