1. НАЦИОНАЛЕН МЛЕЧЕН БОРД1 Conditions and challenges to dairy sector in Bulgaria Atanas Kiskinov National Dairy Board Co-financed by the European Union within the programme "Europe for Citizens" 2007 – 2013

2. НАЦИОНАЛЕН МЛЕЧЕН БОРД2 General Assembly Board of Directors Executive Director General administration Administration with specific functions Eight Regional Dairy Boards: Sliven, Plovdiv, Kyrdjali, Blagoevgrad, Vratsa, Pleven, Ruse, Dobritch National Dairy Board - structure

3. НАЦИОНАЛЕН МЛЕЧЕН БОРД3 - Representation and support of its members interests before the governmental and non-governmental institutions, organizations and other parties. - Co-operation, assistance and information exchange among its members - NDB give consultancies and carries out informational campaigns upon implementation of Bulgarian and European legislation in dairy sector, upon the Rural Development Programme 2007-2013 - Gives proposals to the Minister of Agriculture and Foods concerning allocation of financial aid for milk producing - Carries out activities for the purpose of increasing Bulgarian dairy farms competitiveness - Collects and summarizes information coming from the Regional Boards and if necessary NDB notifies the government and asks for dairy market interventions National Dairy Board tasks

4. НАЦИОНАЛЕН МЛЕЧЕН БОРД4 In drawing-up and implementation of dairy sector strategic plans ; In drawing-up of dairy sector annual reports In developing of legislation concerning dairy sector National DAIRY Board takes part:

5. НАЦИОНАЛЕН МЛЕЧЕН БОРД5 Allocation of milk producing farms 2005 г.2006 г.2007 г.2008 г. Number of dairy farms 152 900136 400122 900103 900 Number of dairy cows 368 800345 500342 500333 000 Number of sheep farms 201 700181 200172 300152 700 Number of sheep 1 330 2001 309 4001 268 6001 189 800 Number of goat farms 229 400196 400170 700154 800 Number of goats 590 200507 500446 500411 700 Number of buffalo farms 1 2001 5001 300700 Number of buffalo- cows 4 8004 3004 6005 400 Total milk production 1 508 0691 515 6371 327 461--------

6. НАЦИОНАЛЕН МЛЕЧЕН БОРД6 Decrease in overall number of milking animals in Bulgaria Jan 1 st 2008 – decrease of the total number of animals in milking farms in relation to the same period of the previous year: -Dairy cows decrease 2,8% (332,9 thousand cows), -Milking sheep decrease 6,2% (1 189,8 thousand sheep), -Milking goats decrease 7,8% (411,7 thousand goats) At the end of 2008 total number of milking animals decreased 2,5% in relation to the end of 2007 and the number is about 1 822,5 thousand. Източник: МЗХ

7. НАЦИОНАЛЕН МЛЕЧЕН БОРД7 Farms groups by legislation First group (category) -Meet veterinary-sanitary requirements for establishment and equipment -Produce milk with the following indicatior: Total Bacteria Count < 100 000/ml Somatic Cell Count < 400 000/ml Second group (category) - Meet veterinary-sanitary requirements for establishment and equipment -Produce milk with indicators over Total Bacteria Count < 100 000/ml Somatic Cell Count < 400 000/ml Third (category) -DO NOT meet veterinary-sanitary requirements for establishment and equipment -Produce milk with indicators over Total Bacteria Count < 100 000/ml Somatic Cell Count < 400 000/ml

8. НАЦИОНАЛЕН МЛЕЧЕН БОРД8 Източник: МЗХ

9. НАЦИОНАЛЕН МЛЕЧЕН БОРД9 Dairy sector trends Increase in the number of the First group farms and decrease of Second group farms (passing from Second to First). There is no active efforts for passing from Third group to First and Second. Bigger farms – increase in the average number of animals per farm Decrease in total number of milking animals in Bulgaria Decrease in total quantity of milk produced in Bulgaria - 7.7% down in relation to the previous year

10. НАЦИОНАЛЕН МЛЕЧЕН БОРД10 Dairy processing companies (DPC) in Bulgaria Number of DPCDPC eligible to sell on the EU market 1989 г.53none 1995 г.826none 2000 г.4704 2003 г.33014 2005 г.27333 2006 г.20834 2007 г.22322 Oct 2008 г.23786

11. НАЦИОНАЛЕН МЛЕЧЕН БОРД11 Dairy products foreign trade 2005 г.2006 г.2007 г.2008 г. Jan-Jun Import, tons20 94420 90229 80420 223 Export, tons 18 80415 85423 24214 032

12. НАЦИОНАЛЕН МЛЕЧЕН БОРД12 Milk and dairy products import, tons Products 20042005200620072008 Jan-Jun Milk, cream - non-concentrated and non- sweetened 1981832944 4774 076 Milk and cream – concentrated and sweetened 12 1688 3808 18311 1079 393 Yoghurt and yoghurtlike products75129167752387 Whey – concentrated or powdered5 8456 6687 2997 6783 482 Butter2 0401 8611 3611 6931 273 Cheese4 1073 7233 5984 0971 612 Total24 43320 94420 90229 80420 223

13. НАЦИОНАЛЕН МЛЕЧЕН БОРД13 Milk and dairy products export, tons Products 20042005200620072008 Jan-Jun Milk, cream - non-concentrated and non- sweetened 225266316672531 Milk and cream – concentrated and sweetened 7628791 047480 Yoghurt and yoghurtlike products1082391 1004 3342 826 Whey – concentrated or powdered2,5646455 Butter1492 3665701 083503 Cheese15 22815 89913 78416 0429 617 Total15 78818 80415 85423 24214 032

14. НАЦИОНАЛЕН МЛЕЧЕН БОРД14 Dairy sector opportunities Improvement of produced milk quality Extension of farms capacity Implementation of new technologies and genetics practices BIO-Agriculture development Development and launching of new dairy products Positioning and promotion of new dairy products Improvement and strengthening the connection between milk producers and dairy processors Improvement of management knowledge and abilities, as well as the effectiveness, of dairy farms and dairy companies Opportunities of Rural Development Programme Structural switch to milk-sheep-breeding, milk-goat-breeding, milk- buffalo-breeding Legal protection of traditionalli specified products

15. НАЦИОНАЛЕН МЛЕЧЕН БОРД15 Dairy sector threats High number of small and uncompetitive farms Decrease in number of farms Import competitive pressure Low rate of waste conversion solutions Low productiveness, low level of genetics used in the farms Decrease of overall milk production Serious differences in raw milk quality High expenses concerning quality control in farms Lots of farms will die for not meeting the hygiene requirements Economical instability decreases the farmers willingness to invest and improve milk quality Poor management knowledge and abilities in farms – high expenses Low consumers purchasing capacity Social risks concerning the owners and employees of the closed farms

16. НАЦИОНАЛЕН МЛЕЧЕН БОРД16 Troubles Government cannot answer effectively to the dairy sector crisis There are not clear priorities and goals of the state financial aid – even farms not meeting the requirements gain financial support Slow and ill-working cow milk quota system Long delay in establishment of specialized laboratories for raw milk quality control Bank credit crisis – impacts on the process of gaining support through the Rural Development Programme Usage of plant fat and other supplements in traditional products which leads to loss of trust on the Bulgarian and foreign market.

17. НАЦИОНАЛЕН МЛЕЧЕН БОРД17 Opportunities Measures for making it easier for the dairy farms to gain bank credits. Developing of new dairy products, promotion and common efforts for expanding the dairy market Prolonging the transitional period after 2009 for farms working on projects under Rural Development Programme Differentiation in financial support between business-oriented big farms and small farms (socially significant) Development of integral strategic plan for dairy sector development with the active participation of branch organizations

18. НАЦИОНАЛЕН МЛЕЧЕН БОРД18 Thank you for your attention! Contacts: E-mail: office@nmb.bg Тel: 02/942 1999office@nmb.bg