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THE COMPETITION IN 1997
U.S. and
Competitor Expenditures on Export Promotion and
Export Subsidies for Agricultural, Forestry and Fishery Products
Denmark
Principal Danish promotion organizations include the Agricultural Marketing Board, the Danish Dairy Board and the Federation of Danish Pig Producers and Slaughterhouses. Pork and dairy products -- which account for about 60 percent of Denmark's agricultural exports -- receive the bulk of export promotion funding. Promotional funds are spent in such principal markets as the United Kingdom, Germany, Russia, Austria, Sweden, Finland, the Middle East, and Japan and South Korea. Total government allocations to export market promotion in 1997 were $5.1 million and industry expenditures by the commodity boards were $8.9 million. These are slightly less than 1996 expenditures in dollar terms, but about the same in Danish kroner. Individual companies spent substantially more on export promotion, but no information is available on these expenditures.
Danish Promotion Activity:
Market promotion activities are funded primarily from producer levies and supplemented by returned land, pesticide and CO2 taxes, as well as a small appropriation from the legislature. These funds, which total about $80 million are used primarily for domestic promotion. About $14 million is used for export promotion. Approximately $2 million of this amount is used to support activities of the Agricultural Marketing Board (AMB), which operates an office in Tokyo and coordinates Danish participation in international trade fairs. AMB is a private-sector organization which is a subdivision of the Danish Agricultural Council. In 1996, AMB’s expenditures of $7.8 million were financed from the contributions mentioned above as well as user fees and interest.
The commodity boards represent both the cooperatives and other producer and industry groups. They act as coordinating channels and have as their objective the development of agricultural export markets for bacon and pork, dairy products, beef and horticultural products. In addition to market promotion, they coordinate marketing and related measures within the sectors, including administration and distribution of the revenue obtained from production levies, price leveling activities, and sales to state trading countries. They receive no direct government grants or funds, but since 1978 have administered certain transfers of the tax revenues mentioned above. The following boards are involved in export promotion: the Danish Dairy Board, the Federation of Danish Pig Producers and Slaughterhouses, the Danish Livestock and Meat Board (covers beef and veal), and the Danish Commercial Horticultural Association. As the dairy and pork industries have consolidated, the role of these boards in market promotion has declined. For example, in the dairy sector there is only one big company now, MD Foods, and in the pork sector there are four main companies, Steff-Houlberg slaughterhouses, Vestjyske Slagterier, Danish Crown and Tulip International. These companies do most of their own market promotion, including advertising, in-store promotions and participation in trade shows.
Export promotion activities of the commodity boards include television advertising and in-store promotions, study tours in Denmark for foreign journalists, quality guarantees and labeling programs. Since 1995 the Danish Dairy Board only promotes butter to the UK, Germany and Middle East. Other dairy promotion, particularly for cheese, is conducted by MD Foods. Another tool used to increase awareness of products is trade missions associated with visits by the Danish royal family and government ministers. For example, the Danish Minister of Agriculture led a high-profile trade mission to Malaysia and the Philippines in late August 1996. The mission included 30 Danish industry officials, 20 officials from farm organizations and the Ministry of Agriculture and 15 journalists. In October 1997 the Crown Prince and the Minister of Industry visited Japan accompanied by representatives of the Danish pork industry.
The Danish pork exporters’ association is continuing to work with the EU to obtain EU financing for market promotion. Denmark first sought the funds last year to compensate its producers for reductions in EU export subsidies, but has not yet succeeded in establishing a market promotion fund.
Competitor Activity:
Denmark is a major agricultural exporter and imports of most agricultural products are limited. 1977 competitor expenditures in Denmark are estimated at $5.7 million, half of which is for wine and fruits and vegetables. The most active competitor in the Danish market is France’s SOPEXA, which promotes French cheese and poultry as well as wine and fruit. Other countries promoting wine in Denmark include Germany, Italy, Spain, Portugal, Austria, Bulgaria and Australia. In the fruit and vegetable sector, France and Italy mainly promote apples and pears while South Africa, New Zealand and Israel promote citrus and other exotic fruits and vegetables. Denmark is the single most important market for Norwegian seafood. The Norwegian Seafood Export Council conducts promotional activities in this market.
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