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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
The Netherlands
The Ministry of Agriculture, Nature Management, and Fisheries is the only government agency promoting Dutch agricultural products with a 1996 budget estimated at US$5.4 million, the same level as in 1995. Almost half of the Ministry of Agriculture's budget is used to organize agricultural product exhibitions, primarily trade fairs, while advertising and in-store promotions account for about 15 percent. Other activities include buyers' missions, trade contact meetings, market research and publications. There are dozens of other private and publicly supported trade organizations that carry out export market promotion activities. The total budget of these nongovernment organizations is estimated at $78.8 million for 1996.
Dutch Export Promotion:
The promotional outlays by the marketing boards or industry associations are financed primarily through producer or processor check-offs and levies. Dairy and horticultural products receive the majority of promotional support, reflecting the importance of these industries to the Dutch economy. While the bulk of the organizations' export promotions are aimed at other EU countries, organizations for meat, poultry, eggs, and flowers conduct significant promotion campaigns in Asian countries as well.
The Dutch Dairy Bureau is by far the largest of the Dutch agricultural export promotion organizations. The Dutch Dairy Board, a quasi-governmental commodity association, is financed by producer checkoff funds. The Board passes some of these funds to the Dutch Dairy Bureau for export promotion. The Dairy Bureau promotes primarily cheese, but also has a small budget for butter. Most of the export promotions are directed toward other EU member states.
Until recently, the Central Bureau for Horticultural Auctions promotes the sale of fresh fruit and vegetables. However, in late 1996, this organization was disbanded and replaced by the Greenery International. The Greenery International has an annual turnover of $1.5 billion, 13,000 grower members, and controls over 75 percent of the Dutch fruit and vegetable auction sales. It has the second largest promotion budget of all the Dutch commodity organizations. Revenues originate from levies on producers computed at the various fruit and vegetable auctions throughout the Netherlands. Germany and the United Kingdom are the primary target markets for the Bureau, which stresses the quality and freshness of the products in its advertising and trade promotions. About one-third of the budget is used to promote tomato exports. A few months after the Greenery was launched, it announced a reorganization involving 350 auction job losses and 110 new hires in its information technology and marketing departments. The Greenery is working hard to improve the perception of the Dutch tomato among foreign consumers and to regain market share that has been lost to other producing countries, especially Spain, Italy and Morocco.
The Information Bureau for Meat promotes the export of Dutch fresh and canned meats, as well as meat by-products. The Product Board for Meat and Livestock obtains its funds through levies on animals as they are slaughtered. Most of its budget is used for generic promotion of Dutch meats. Trade missions are the most common form of promotions. Nearly all of its budget is spent in other EU member states, particularly in Germany.
The International Flower Bulb Center receives its export funding from the Product Board for Ornamental Products. The funds are raised by levies on the growers and traders. The Center's budget is used primarily for public relations, trade advertising, and exhibitions and is spent in other EU member countries, Norway, Japan, South Korea, Hungary, and Poland.
The Flower Council of Holland also receives its export funding from the Product Board for Ornamental Products. The funds are also generated from levies on growers and traders. Most of its promotion budget is spent in Germany, France, Italy, Belgium, and the Netherlands. Promotion activities consist of consumer advertising, trade promotion, and public relations. Markets of growing interest are Italy, Austria and Switzerland.
Competitor Activity:
Several EU member states, especially France, Germany and Italy have active food promotion campaigns in the Netherlands. The German CMA promotes German food and beverages in the Netherlands through its office in Brussels while France’s SOPEXA promotes traditional French products such as wine, cheeses, fruits and vegetables.
The most visible product-specific promotional campaigns by competitor countries are for wine. France holds approximately 43 percent of the Dutch wine market. Its generic wine promotion activity has declined over the past year or two, but it continues to support promotions in cooperation with larger Dutch retailers. German wines account for 12 percent of the Dutch market. The German and Spanish wine industries conduct a number of wine tastings and fairs each year, as well as wine trips to Germany and Spain. The Germany Wine Institute offers top quality promotional materials which can be adapted to meet a particular retailer’s needs.
In addition to wine, there are also a number of fruit and vegetable products that are regularly promoted in the Netherlands, usually with the assistance of foreign marketing boards. Products typically promoted include New Zealand kiwifruit; South African apples, table grapes and citrus; Israeli citrus, fruits and vegetables; Chilean apples, pears and table grapes; French fruits and vegetables; and citrus from Spain and Morocco.
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