INTRODUCTION Agricultural sector has become much more competitive within the EU
SPAIN Healthy market for traditional produce

Farming employs more than 1.1 million Spanish people, or nearly seven per cent of the working population. Revenues from the agricultural sector increased by about four per cent last year and profits rose to nearly 132 million euros ($116m).
One thing is certain – agriculture is fast becoming big business and food-processing is a major global industry. Intensive
mechanisation is fast replacing traditional methods of farming and the landscape is changing.
Spain is actually encour-aging its elderly farmers to give up their holdings. Annual compensation of up to $5,183 per person and an annual premium up to $3,192 are being offered to those who stop farming and give over the business to a third party.

One of the government’s priorities is to try to persuade EU members to agree on direct payments to farmers in new member states when they join in 2004. “It does not seem logical to have two-speed agriculture within a single market,” says agriculture minister Miguel Arias Canete.
Mr Arias proposes that direct payments in new member states should be scaled up
to the full amount over a period of five to 10 years. He says Spain faced a similar phasing-in period after joining the EU in 1986. The country waited a decade before receiving full subsidies for important produce such as fruit, vegetables and olive oil.

“Agriculture has experienced a radical change since joining the EU,” says Mr Arias. “From a traditional agricultural sector within a protected market it has transformed into a competitive one.
“This has been particularly true for Mediterranean agriculture, which has not benefited from European funds. However, with a borderless Europe that consumes a lot of EU products, Spanish fruit, vegetables, olive oil and wine have become much more prominent in European markets. The other 14 EU members have become much more interested in Spanish produce, and we are making big inroads into these markets,” he says.

Another priority for the Spanish government is food safety. Farmers across much of Europe have not had an easy time in the past 18 months as swine fever, BSE and foot-and-mouth disease forced the slaughter of thousands of animals. Spain has been no exception and its BSE outbreak cost the country more than $800 million. This has put the nature of modern food production into the spotlight, leading to calls for the establishment of a European Food Safety Agency.

There have been reams of articles in the media about healthy eating and one product is mentioned probably more than any other – olive oil. For some, making the right choice of olive oil is nearly on a par with choosing the right wine.
Olive oil is being recommended as part of a balanced diet, particularly as an alternative to fat-saturated butter and lard. It is hardly surprising then that a Mediterranean diet based on fresh produce and olive oil is deemed to be the healthiest in the world.

‘Exports should grow 10 to 15 per cent a year’ Juan Vicente Gomez Moya

Southern Spain’s climate and soil are ideal for the cultivation of olive trees. It has the largest olive oil industry in the world and it would like us to buy more. Juan Vicente Gomez Moya, director of Asoliva, Spain’s olive oil industry and exporters’ association, says: “I do not know of any Spanish dish that does not have olive oil as an ingredient.”

Last year, Spain saw record exports of the product, partly because of a world shortfall. It is estimated that olive oil exports for the year ending October 2001 increased by
33 per cent to a record 477,200 tonnes. Total output for the same period was just over one million tonnes, 16 per cent up on the previous three seasons. The key producing region, Andalucia, has upped its estimate for this year’s season to 850,000 tonnes.
Mr Gomez says: “Since Spain joined the EU, farming methods have improved greatly. There has been a clear improvement in quality control, product presentation and labelling. The technical side of the business has received more attention.

“Family businesses are run in a more professional way. Export departments are better prepared and exports should continue to grow at between 10 and 15 per cent a year.”
Mr Gomez does not foresee conversion to Spanish olive oil in Britain overnight. But he says: “We want British consumers, and others, to understand that our product is just as good as anyone else’s, if not better. The competition is ferocious, but things are beginning to change and we are seeing more Spanish products in British supermarkets.”
Spanish rice and biscuit group Sos Cuetara took over Koipe in December for $310 million. Koipe was Spain’s leading cooking oil company, producing sunflower, maize and olive oils. Pre-tax profits for 2001 were $14 million on revenues of $326 million, up on the previous year.

‘We produce 33 million hams a year’ Felipe Macias

Unlike olive oil, Spanish cured ham has not gained such a wide appreciation in Britain, which is a pity for we are missing out on some of the world’s finest.
“One must bear in mind that we are competing against the Italians,” says Felipe Macias, managing director of Consorcio Del Jamon Serrano Espagnol (the Spanish Serrano Ham Consortium).
“The UK imports a lot of Italian ham. Despite the efforts being made to introduce the culture and consumption of Spanish ham and products to the UK, we feel it is a weak market. It is behind other European countries such as Austria and Switzerland.”

Spain is the top producer of dry-cured ham in the world, but Italian ham, notably proscuitto, has been exported abroad for far longer than serrano. “We have been present in export markets only for the past 10 years, although we actually produce 33 million hams a year compared with Italy’s 26 million,” says Mr Macias.
He says the British regard Spanish and Italian produce with entirely different perspectives. Italian ham is better known than serrano in Britain because it has been sold here longer and promoted more widely.
“There are Italian, or pseudo-Italian, restaurants all over the world, which has been a useful way of penetrating the markets with Italian products. This is not the case with Spanish restaurants because there are not so many of them abroad. I get very annoyed when I go to a Spanish restaurant abroad, only to find that the olive oil I am being served is not Spanish,” says Mr Macias.

There are 1,200 to 1,400 firms, usually medium-sized and family-owned, producing dry-cured ham of which only about seven per cent of output is exported. Mr Macias says only 200 producers export, as most are either too small or happy to meet domestic demand. “The irony is that, although we continue to produce more each year the Spanish are the biggest consumers of our ham,” he says.
“So, although our exports are increasing, domestic consumption is growing at a faster rate. This is due to the increased standard of living in Spain.”

The Spanish Serrano Ham Consortium, set up in 1990, represents only 15 companies but these account for 40 per cent of the overall production of serrano ham and 70 per cent of exports. The consortium has two main tasks: promotion and quality control.
Serrano ham can be produced anywhere in Spain, although its origins were in the sierras, where the cold dry air aids the natural curing process. To maintain standards, the consortium carries out inspections so the ham can be certified as being ‘especialidad tradicional garantizada’, which means that producers have followed the traditional method of curing, using Spanish pigs in Spain. Serrano hams are usually cured in controlled conditions for periods of between six to 14 months.

The term ‘Iberico’ applies only to hams from pigs that have been raised on the Iberian peninsula, where they can roam freely in Mediterranean woodlands of cork trees and holm oaks whose acorns, together with aromatic grasses known as ‘dehesas’, are their staple diet.
Iberico hams are dry-cured naturally for up to two years or even longer. This ham is popularly described as ‘pata negra’ or black foot, but the black-footed pig is becoming rarer and the breed now includes pigs with dark to light trotters. Each ham is branded with the Real Iberico seal, guaranteeing its unique flavour and outstanding quality.
“Iberico ham constitutes around 10 per cent of all national production, but only
one per cent is actually exported. Production is very small because the prices are exorbitant,” says Mr Macias.