Intro Holland Agrisector Success factors Trends Policies Exit

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Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments 1

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments 1

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Meeting

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Meeting LNV/Korea Trade Center 23 -7 -2007 1. In the process of advancing or modernizing the agricultural industry in the Netherlands, what were the important steps and policies that lead to the success of Dutch agriculture industry today? ● Tradition: NL has a strong operating Agri-cluster with a great matter of business instinct ● Climate: NL has a good climate for the production of several agricultural products, for instance the clay-grounds for the production of flowerbulbs in the western part of NL. ● The consuming market and strategic location: NL are a flat and valuable country. With the EU, NL has a huge consuming market ● Logistics: NL has a great infrastructure: Gateway to Europe, but deals with traffic jams Agrologistics ● Stimulating innovations 2

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments ●

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments ● Important developments after the WOII: ● i. Education, Information and Scientific Research ● ii. Free Marketaccess thanks to the EU ● iii. Strong developments within the Agricluster: Tradeorganisations, Productboards ● Stimulating free markets and deregulation 3

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Department

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Department of Trade and Industry ‘A partner for Agribusiness’ ● Trade and Industry helps agribusiness to do business in accordance with the latest (inter)national trading standards ● Focus on Internationalisation and sustainable enterprise ● Demand driven ● Financial and non-financial policy instruments ● Personell: almost 50 staff 30 policy advisors, two members on the board and 4 members on the management team. ● Look at the different portfolio sheets! 4

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Bilateral

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Bilateral Economic Co-Operation (BES) ‘Stimulating International Enterprise’ ● Object BES: To promote trade and investment, to strengthen bilateral relations and to improve the image of the Dutch Agricultural product. ● Instruments are: Trade missions, bilateral high-level meetings, trade meetings, country factsheets, trade fairs, seminars, websites, Monthly Review ‘Berichten Buitenland’ etc. ● BES-Network: Agricultural Counsellors in 30 countries, other ministries (Economical Affairs), agribusiness, financial sector, knowledge institutes etc. ● Yearly Budget: € 3, 5 mln 5

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Socio-economic

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Socio-economic Key Data Holland-Korea ● Surface Area: ● 33. 783 km 2 vs. 98. 480 km 2 ● Population: ● 16, 3 mln vs. 48, 8 mln ● Work force: ● 7, 4 mln vs. 23, 8 mln ● Gross National Product: ● € 506 billion vs. € 787, 6 billion ● Per capita income: ● € 26. 650 vs. € 16. 500 ● Inflation: ● 1, 7% vs. 2, 7% 6

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Success

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Success of Dutch agricultural industry ● Tradition: NL has a strong operating Agri-cluster with a great matter of business instinct ● Important developments after the WOII: – Education, Communication and Scientific Research – Free Marketaccess thanks to the EU – Strong Agricluster: productboards, tradeorganisations ● Climate: NL has a good climate for the production of several agricultural products ● EU as a great Consuming Market (NL is 1 of the founding fathers of the EU) ● Logistics: NL Gateway to Europe (Rotterdam harbour, Schiphol) ● Stimulating Innovation, deregulation and free markets 7

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Economy

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Economy of The Netherlands ● Mixed market economy ● Focus on foreign countries ● Good financial and business service ● Sound infrastructure ● Port of Rotterdam in top 3 ● Transit sector which plays a key role on an international level 8

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Socio-economic

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Socio-economic key data ● Surface area : ● Population on 1 -1 - 2006 : ● Work force (2005) 7. 4 million ● Gross National Product (2005) : ● Per capita income (2005) : 26, 648 euros ● Inflation (2005) 1. 7% ● Unemployment (2005) : : 41, 543 km 2, (33, 783 km 2 land) : 16. 3 million 506 billion euros 6. 5% 9

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Importance

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Importance of the Dutch agri-sector “Agri-sector accounts for 10% of Dutch prosperity and job opportunities” ● Great importance to the Dutch economy ● 10% of GNP (GNP = € 506 bn) ● 1 out of 10 jobs ● Strong international orientation (especially EU) ● Agri-export € 51 bn in 2005 (= 18% of total exports) ● World's second-largest exporter of agricultural products ● Agri-import 11% (€ 28 bn) of total Dutch imports 10

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Export

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Export agricultural products top 12 (USD mln in 2005) United States 76, 055 The Netherlands 54, 820 France 52, 176 Germany 47498 Canada 35, 485 Brazil 33, 681 Belgium 30, 286 Spain 28, 841 China 28, 579 Italy 25, 510 United Kingdom 21, 737 Australia 21, 305 Other countries 275, 109 Total 731, 082 Source: ITC/WTO 11

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Composition

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Composition of the Dutch export package ● Very varied ● Ornamentals and plants form largest product group € 7. 6 bn in 2005 (= 15% of agri total) ● Vegetable exports exceed € 3. 4 bn ● Meat and dairy very important in import and export (in 2005 € 5. 6 bn meat and € 4. 3 bn dairy products) Dutch exports Total Share of domestic raw materials Agriculture and nutrition 20% 65% Chemicals 15% 36% Electrical Engineering 21% 12

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Overview

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Overview of the Netherlands’ most successful exports Share of world export market Export value (USD million) 1. Cut flowers (AF*) 84% 2, 815 2. Flower bulbs (AF) 83% 800 3. Coconut oil (AF) 68% 93 4. Chloroacetic acids (PC) 65% 33 5. Cashew nuts (AF) 64% 65 6. Computer chips (CS) 61% 1, 568 10. Polaroid film (L) 55% 246 11. Cocoa butter (AF) 55% 568 12. Cocoa powder (AF) 54% 534 15. Mussels (AF) 51% 121 Product group *The abbreviation in parenthesis stands for the sector of origin: AF = Agriculture and food cluster PC = Petroleum and chemicals CH = Computers and semiconductors L = Leisure 13

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Trading

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Trading partners export ● More than 80% exported to EU ● Germany is main trading partner (more than 25% of total, € 13 bn in 2005) Germany 25. 7 United Kingdom 11. 6 France 10. 4 Belgium 10. 2 Italy 7. 2 Spain 3. 6 Other EU ● Trading partners’ share in % Dutch agricultural exports (2005) 12. 9 United States 3. 6 Russia 1. 5 Switzerland 1. 2 Other countries 12. 1 14

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Trading

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Trading partners imports ● Trading partners’ share in % in Dutch agricultural imports (2005) Germany 22. 2 Belgium 15. 3 France 8. 3 United Kingdom 3. 8 Spain 3. 8 Italy 2. 4 Other EU 6. 7 United States 3. 2 Other South-America 3. 6 Argentina 2. 7 Other countries 18. 7 15

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Trading

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Trading culture and vision, semigration Emigration Semigration ● Why semigration? ● Arguments ‘home’ – – – + ● cost escalation (quota prices) decreasing profits no potential for growth restrictions on production environmental laws and regulations Arguments ‘there’ – climate – lower costs – costs of labour Case: The source makes all the difference 16

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Quality

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Quality and sustainability, chain management ● Continuous quality improvement ● Ever-increasing standards for – sustainability – quality – safety The answer: Integrated Chain Management 18

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Knowledge

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Knowledge and innovation, knowledge infrastructure ● Knowledge Innovation ● Therefore: knowledge infrastructure ● Centre is Wageningen UR ● WCFS ● Universities (Maastricht, Groningen, Leiden Rotterdam, Eindhoven, Delft) ● TNO Voeding ● RIVM ● NIZO Food Research 19

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Development

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Development of the agricultural and horticultural companies ● ● In 10 years the number of agri- and horticultural companies dropped by 1/3 to 81, 828 in 2005 Dairy farms 21, 334 Other grazing stock (cows, sheep, goats) 18, 666 Arable farms (cereals, sugar beet, potatoes) 12, 369 Intensive livestock farms (pigs or poultry) Field vegetable and glasshouse sector Companies combining several production sectors Total ● 7, 175 15, 031 7, 253 81, 828 Strong growth in mega farms (combined capacity up from 5% to 17% in 10 years) 20

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Ornamentals:

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Ornamentals: Netherlands = flower country Breeding Of the total export of ornamental plants in the EU, the Dutch share is 70% and for bulbs it is as high as 93%. Ornamentals Trade markets • Cut flowers • Asia • Pot plants • Japan • Garden plants • Russia • Trees • Germany • Bulbs • USA • UK • etc. 21

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Meat

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Meat ● ● The Netherlands strives for sustainable animal breeding. In 2005 the Dutch livestock herd (in agricultural operations) numbered: 92, 914, 000 Chickens (of which 44, 496, 000 broilers 11, 312, 000 Pigs and 30, 513, 000 layers) (of which 5, 505, 000 porkers) 3, 799, 000 Cattle (of which > 1, 433, 000 dairy and breeding cows (624, 000 calves (white) and 204, 000 calves (pink)) 1, 363, 000 Sheep 1, 245, 000 Turkeys for meat production 292, 000 Goats 133, 321 Horses and ponies 22

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Food,

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Food, drinks and tobacco ● Largest subsector of the industrial sector ● About 4, 500 companies ● Approx. 144, 000 employees ● Half of turnover outside NL, of which 3/4 within EU ● Many companies are part of multinationals ● Investments in 2004 ● NL € 27. 4 bn abroad, of which € 16. 5 bn outside the EU ● Foreign investment in NL € 29 bn, of which € 15. 4 bn from USA 23

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Food,

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Food, drinks and tobacco ● The top ten Dutch food concerns in 2005 Company Global turnover (x € million) Employees Product groups 1. Unilever 39, 672 206, 000 2. Heineken 10, 796 64, 305 Beer 3. Sovion 6, 285 14, 000 Meat 4. Friesland Foods 4, 419 16, 438 Dairy 5. Campina 3, 569 6, 811 Dairy 6. Nutreco 3, 002 6, 993 Animal nutrition, poultry meat 7. CSM 2, 618 8, 458 Sugar, bakery supplies and lactic acid 8. Numico 1, 988 14, 000 9. Wessanen 1, 877 7, 349 Natural foods and convenience foods 10. Provimi 1, 585 8, 000 Animal nutrition Food and drinks Baby food and clinical nutrition Source: Annual reports and websites 24

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments The

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments The Choice for Agriculture Triple P • People • Planet • Profit Subtle balance ● The guideline is sustainable responsible entrepreneurship ● Government stimulates change and asks sectors to assume responsibility 26

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Key

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Key elements for the agri-sector ● Vigorous, sustainable agriculture and horticulture ● Food quality ● Knowledge and innovation ● An eye for the international context ● Agri-focused business climate 27

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Organization

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Organization chart Minister Ministry of Agriculture, Nature and Food Quality of the Netherlands Executive Board Secretary-General Director-General Ministers’ Office Personnel and Organization Department Audit Branch Department of Nature Department of Fisheries Department of Legal Affairs Department of Food Quality and Animal Health Department of Knowledge Financial and Economic Affairs Department of Information Mgt, Facilities and Services Department of Agriculture Department of Trade and Industry Department of International Affairs Department of Rural Affairs Department of Knowledge Food and Consumer* Product Safety Authority * Falls under responsibility of both the Ministry of Health, Welfare and Sport and the Ministry of Agriculture, Nature and Food Quality Inspector-General * The Risk Assessment Division is an independent unit within the Food and Consumer Product Safety Authority National Service for the Implementation of Regulations Plant Protection Service General Inspection Service Government Service for Land Water ICT Services 29

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Five

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Five reasons to invest in the Netherlands 1. Strategic location in Europe 2. International business environment 3. Superior logistics and technology infrastructure 4. Highly educated, multilingual & flexible workforce 5. Quality of life 30

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Thank

Intro Holland Agri-sector Success factors Trends Policies Exit Economics Export Developments Chains Investments Thank you for your attention Questions? 31