European cheese industry: changing structure, economies of scale and implications for competitiveness

Abstract

This paper shows the changes in the structure of the European cheese industry in the 1990s, and the implications of recent competitive behaviour. There has been a reduction in the number of plants and firms, and a significant increase in the number of firms which operate at a scale of over ten thousand tonnes of cheese per year. The extent of economies of scale in the production process is illustrated. Recent and projected investments in the industry are shown. These investments and the drive to make more efficient use of existing capacity have resulted in substantial price competition particularly for semi‐hard cheese, and probably in lower prices to farmers for milk.

Estimating Price Elasticities of Food Trade Functions: How Relevant is the CES‐based Gravity Approach?

“…Over the last decades, the European dairy industry has seen significant structural changes, notably the emergence of a small number of very large firms accounting for a large and growing share of milk collected and output of dairy products. This concentration results from many factors, including technical change and scale economies, greater concentration in the retail industry as well as demand changes (Pitts, 1998). In that general trend, it appears that the consolidation of the cheese industry has increased at a slower pace compared with that of the other dairy industries.…”

“…However, we already get significant econometric results against the CES with these HS6 level data. Moreover, moving to a finer product detail is likely to involve less reliable data (as experienced by Pitts, 1998). In order to reduce the dimension of the econometric models and to be consistent with previous work, we apply our econometric models to each cheese separately.…”

Enhancing competitiveness in cocoa associations: An integral project management approach based on Porter’s Diamond Model

“…In the annals of business literature, few concepts have incited as much debate as that of competitiveness. Pitts and Lagnevik (1998) touch upon the multifaceted nature of competitiveness, highlighting its role in understanding the intricacies of investment, corporate success, and effective policymaking. Yet, the lack of a unanimous measure for competitiveness is evident, pointing towards its vast applicability spanning firm, industry, and national landscapes, each governed by varied indicators such as profitability, market dynamics, and cost structures (Banse et al, 1999).…”