REFORM CAP - FOOD INDUSTRY Decoupled Farm Subsidies Single Payment –x--- Production 1. Market Required Food Products Environmental Quality Food Safety Animal + Plant Diseases/Health 2. Rural Development Fund (€1.2B/annum - Post 2005) Food Safety + Quality Animal Welfare (Diseases) Essential Knowledge Driven Agri-Food Sector
Food Industry
ECONOMIC ENVIRONMENT Sustained International Competitiveness More Liberal - Global Markets Higher Levels of Food Regulation Substantially Greater Requirements Assured Food Safety, Consistent Quality Nutritional Attributes, Animal Diseases/Welfare Quality of the Environment Increased Corporate Alliances Suppliers + Manufacturers + Retailers Rapidly Changing Lifestyles Population Becoming Older Shrinking Household Size Women in the Workforce Two Income Families LESS Time Shopping + Cooking More Leisure Demands
IMPACTS - FOOD INDUSTRY Market Developments Convenience - Easy to Prepare Meals - 30 Minute Dinners Functional Foods - Neutraceuticals Food Service Sector Supermarkets Requirements Accelerated Innovations in Agri-Food Sector Ubiquitous Application of IT + Biotech!! Knowledge Driven Agri-Food Sector
Dairy Product Portfolio - Direction of Change Functional and organic foods 15% 5% Consumer products 20% 20% Value added ingredients 30% 65% Base Products 45% Base Products Current product portfolio mix 2015 product portfolio mix Promar International
Economic Performance Comparison 1992 - 2000 Ireland Denmark Netherland Economic Value Added 1.56 2.16 1.66 (EVA) Relative milk Price 100 114 108
Current Beef Grading/Quality Systems Depends on human judgement Difficult to demonstrate objectivity Producers lack confidence Difficult to agree quality based payments
New Instrument Grading Systems Already some adoption by industry in US and EU Recent regulations by USDA and EU likely to increase the rate of uptake Potential for further developments and improvements - fat class (EU), palatability Familiarity with benefits of VIA (objectivity, consistency, MIS) - lead to greater adoption
NEXT STRATEGIC STEP Step Change - Food Innovation + Serious + Sustained €M - R&D + + Technological Absorptive Capacity Food Companies - SMEs + Business Partnerships Public Research Organisations Universities + Applied Research Organisations Market-Led Innovative Food Products + Processes __________ Japan - Functional Foods 50-500 R&D Personal/Company Finland - Tekes €50m R&D Program Functional Foods, Food Chemistry + Biotechnology
New Food Product Development High Costs + High Risks + 90% Failure - 1 Year Market Imperative - Reduce Risks Understanding + Quantification Issues Farming Consumers Attitudes to Food Products Denmark MAPP Institute Food Related Lifestyle Consumer Model Applied Ireland
FUNCTIONAL FOODS FOOD PRODUCTS Specific Health + Nutritional Attributes especially Infants, Adolescents + the Elderly Functional Foods PROBIOTICS NEUTRACEUTICALS (Life Organisms) Lactose Intolerance Diarrhea Disease Resistance Healthy Gut (Chemical Ingredients) Osteoporosis Hearth Disease Cancer Dental Caries
Functional Foods: Potential Health Attributes of Food Ingredient Potential Heal Attributes Calcium Prevention of Osteoporosis Promotes healthy bones and teeth Protective against hypertension Folic Acid Protective against neural tube defects Vitamin E Protective against Heart Disease Protective against Cancer Iodine Protective against Goitre Immuno-peptides Casein Phosphopeptides Promotion of Calcium Absorption Lactoperoxidase Prevention of dental caries Lactoferrin Prevention of gastro-intestinal infection Leukaemia therapy Modified β _ Lactoglobulin Prevents milk protein allergies Lactic Acid Bacteria Promote a healthy gut Immunoglobulins Lowering of Cholesterol Functional Foods: Potential Health Attributes of Food
Functional Foods and Their Potential Market Scale Small Potential Market Scale Large Large Small Feasibility/Approvability
SOME MARKET PROJECTIONS All Functional Foods Global Market 1994 $6.6 Billion ~ 50% = Japan 2000 $17 Billion Longer Term $ 87 Billion Probiotic Dairy Products - Most Active Area - 65% European Functional Food Market (1997) 1997 $889 Million 1998 >250 Million Kg UK, FD, Sp, B, Nl, DK, F, S Longer Term ~ $30 Billion
Microbiological Contaminents FOOD SAFETY Chemical Residues Microbiological Contaminents (Pathogens) BSC - Prions Mycotocins - Fungi Viruses