1. Bulgarian Dairy Processing Sector – Best Practices DIlyana Slavova Member of the European Economic and Social Committee November 2010

2. Who Are We? Whose Interests Do We Represent? National Association of Milk Processors (NAM) is a non- governmental, non-profit organization that supports, promotes, and represents the interests of its members. At present it is the biggest dairy organization on the territory of Bulgaria. We represent the interests of: 100 milk processing establishments and their milk producers Companies whose activities are related to the dairy industry Prominent scientists in the field of dairy industry

4. Bulgarian Dairy Farming Bulgarian dairy farming is characterized by a dual structure, with a significant number of large private farms (on average with more than 50 cows) and a large number of very small farms, often run at subsistence level; Small producers who breed between one to nine cows: The milk is marketed to a collection centre. The milk microbiology usually does not comply with the EU standards. The milk producers often operate small farms and produce apart from the milk different agricultural products. At times, farming for them is a part-time activity. However, these small-scale milk farmers should be given the opportunity to market their surplus or be provided with guidance to redirect their production into such areas where their output will be able to be sold and thus provide income for these producers. This will require further analysis that takes into consideration the overall market development of the dairy sector in Bulgaria and seeks means to integrate small-scale producers into the system. Restructuring of the small-scale farming sector is important, but without reasonable time and financial frame, it might cause a number of social problems as often farming is the only income opportunity for this group.

5. Bulgarian Dairy Farming Specialized milk producers who breed between ten and 50 cows: The farms of farmers belonging to this category are often of medium-size and specialized in milk production. Also producers of this category are relatively young and most of them have a commercial orientation. As a rule, they sell their milk to dairies. Intensive milk producers who keep between 100 or several hundred cows: Their main focus is milk production and their output is sold to the established diaries. Milk quality is usually good. In general, the cluster of larger private farms is growing rapidly due to their profitability and their vicinity to processing units, a situation that is very similar to that of EU countries. The potential of sheep/goat/buffalo milk is not fully realized by government authorities to facilitate rural development and improve income-earning capabilities of small-scale farmers and specialized processors.

6. Milk Processing Industry Milk processing establishments Total number – 249 All are certified for EU Transitional Period for the raw cow milk

7. Milk Processing Establishments Even though some of the units are of very small size, cottage industry in the sector of milk processing is an active component of the dairy sector in the EU. Independent of their size, these units are subject to the same strict quality norms and standards that at times have a rather restrictive impact on their activities. Three different types of cottage industry units can be distinguished: The largest group of small dairies are located in mountainous regions. They have a long tradition and use high quality mountain milk to produce hard cheeses of a particular quality. These small dairies play a considerable role in the dairy sector due to the quality their products, their competitiveness and the strong consumer demand. Their economic viability appears assured for the future. Another group of small dairies prevails in areas of sheep and goat rearing. Their products bear often a label that opens excellent marketing channels such as supermarkets and speciality shops. Another category of small dairy operate on the basis of biological/organic milk and process liquid milk and various fresh dairy products.

8. Best Practices EU Project for Promotion of Bulgarian white brine cheese and kashkaval in Germany and Spain A Dutch Project about limited administrative burden of small MPE. NAM has elaborated a limited administrative burden Hygiene Code.

9. Final Goal: Preservation of Bulgarian dairy sector and national traditional dairy products. The safeguarding of milk production must, therefore, go hand in hand with restructuring the dairy sector, strengthening the whole of the production chain up to the distribution of final products, which, for Europe, with its traditional focus on value added products, is of key importance (e.g. cheese).

10. Thank you! National Association of Milk Processors Bulgaria, Sofia, P.O. 1232 GSM: 00359 888 501 349, 00359 885 77 88 75 Fax: 00359 952 68 45 E-mail: n_a_m@abv.bg