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TRANSCRIPT
June 2018
Tomatoes market
overview in Romania
2
TABLE OF CONTENTS
Summery ______________________________________________________ 4
PEST Analysis __________________________________________________ 7
Political Environment ______________________________________________________ 7
The Political System in Romania ___________________________________________ 7
Government Stability ____________________________________________________ 7
Employment laws _______________________________________________________ 7
Tax Regulations ________________________________________________________ 8
Corruption Levels _______________________________________________________ 8
Trade Regulations& Customs _____________________________________________ 8
Economic Environment ____________________________________________________ 9
GDP and Inflation ______________________________________________________ 9
Currency & Interest rates:_________________________________________________ 9
Credit accessibility: _____________________________________________________ 10
Disposable income of buyers: ____________________________________________ 10
Tax& Duties __________________________________________________________ 11
Social Environment ______________________________________________________ 12
Demographics ________________________________________________________ 12
Cross-cultural communication ____________________________________________ 13
Consumer behavior ____________________________________________________ 15
Distribution of Income ___________________________________________________ 16
Happiness Index: ______________________________________________________ 16
Human Development: ___________________________________________________ 17
Age dependency ratio: __________________________________________________ 17
Technology Environment __________________________________________________ 18
Port traffic & infrastructure _______________________________________________ 18
Railway transport of goods: ______________________________________________ 18
Road transportation ____________________________________________________ 18
Enabling Trade ________________________________________________ 19
Overview _____________________________________________________________ 19
Most problematic factors for exporting to Romania ____________________________ 21
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Most problematic factors for exporting from Romania __________________________ 21
Product Brief __________________________________________________ 22
Product Definition ________________________________________________________ 22
Local Production ________________________________________________________ 23
Romania Imports of Tomatoes ______________________________________________ 25
Romania Exports of tomatoes ______________________________________________ 28
Consumption ___________________________________________________________ 29
Product Quality __________________________________________________________ 30
Product Trends and outlook ________________________________________________ 36
Compliance for export ___________________________________________ 38
A. Legal & Non-Legal requirement the product must comply with ______________ 39
Distribution Channel ____________________________________________ 43
SUpplying Markets and competition ________________________________ 47
Pricing _______________________________________________________ 48
MArket Requirments & Certificates _________________________________ 51
Potential Leads ________________________________________________ 53
References ___________________________________________________ 55
Appendix: OVERVIEW GLOBAL tomatoes MARKET ___________________ 57
4
SUMMERY Substantial fiscal stimulus boosted economic growth to +3.9% in 2015, followed by +4.8% in 2016 and +5.8% y/y
in H1 2017. Vigorous domestic consumption has been the key growth driver, with private consumption up by
+7.7% y/y in H1 2017 (+7.4 in full-year 2016) and government consumption up by +3% y/y (+4.5% in 2016). In
contrast, fixed investment has been weak for a long time, declining by -3.3% in 2016 and -1% y/y in Q1 2017, as
the government has been slow in taking up new projects financed by EU funds under the 2014-2020 programming
period. But it finally resumed modest growth of +2.4% y/y in Q2. And, inventories made positive contributions to
growth in H1 (+1pp) and 2016 (+1.1pp). External trade activity accelerated in 2016 and Q1 2017 but eased
somewhat in Q2. On average in H1 2017, exports rose by +8.7% y/y and imports by +10% y/y so that net exports
subtracted -0.6pp from H1 growth (-0.7pp in 2016).
We expect the growth momentum to slow somewhat in the next 18 months, especially as the build-up in inventories
should wane. We forecast full-year GDP growth of about +5.5% in 2017 and +4% in 2018.
Monetary policy is officially based
on inflation targeting but, in
practice, the National Bank of
Romania (NBR; the central bank)
also aims at a certain degree of
currency stability and, since 2009,
attempts to steer credit growth
and liquidity. Indeed, the key
policy interest rate has been
steadily lowered since March
2009, despite considerable
inflation volatility until mid-2013.
Since September 2013, headline
consumer price inflation has
rapidly fallen and has been below
the NBR's inflation target of
2.5%±1pp (set at the start of
2013) since early 2014. Moreover,
inflation was in negative territory
from mid-2015 to end-2016 as a
result of a series of tax cuts
(mainly VAT).
As the base effect of these cuts
faded, positive inflation has
resumed in early 2017, as
expected. But it has remained
relatively moderate (1.4% y/y in July) as compared to peer countries owing to a further 1pp across the board VAT
cut and the abolition of an extra excise duty on fuel. Going forward, buoyant domestic demand and rising wages
should exert some upward pressure on prices. We expect inflation to edge up to about 1.6% at end-2017 and to
average 2.5% in 2018. The NBR has kept its policy rate steady at 1.75% since May 2015. We expect this rate to
prevail until end-2017 or so before gradual monetary tightening is likely to start next year.
The RON/EUR exchange rate has been quite stable since 2013, fluctuating by a mere ±3.7% around an average
4.46. The Emerging Markets sell-off in mid- 2013 and early 2014 hardly affected the RON – similar to other
currencies in the CEE region. Nonetheless, renewed exchange rate volatility cannot be ruled out with regard to
ongoing vulnerabilities in the banking sector and what appears to be continued unsustainable fiscal stimulus.
5
Foreign exchange (FX) reserves have moved side-wards over the past seven years, in the range of EUR29-36bn.
The current level of reserves is comfortable with regard to import cover (about five months). However, reserves
cover only 90% of the estimated external debt payments due in the next 12 months. While this is an improvement
compared to 78% two years ago, the figure is still below an adequate level of at least 100%.
Romania has a geo-strategically important position, with an exit on the Black Sea which enables seagoing traffic
flows. Constantza Port has tremendously expanded over the past few years in terms of capacity expansion and
storage/handling facilities
The business climate is improving and the Romanian Government is making efforts to ensuring a fair environment
for businesses. The VAT rate for food was cut from 24 percent to 9 percent in June 2015. Starting January 2016,
the standard / general VAT was reduced from 24 percent to 20 percent. These VAT reductions increased
consumer purchasing power. Consumer demand was also boosted by rising real household disposable income
as a result of increases in wages, pensions and remittances from abroad and rapid growth of new consumer loans.
Retail sales grew by an average of 12.4 percent per month in volume terms in the second half of 2015, compared
with an average of 4.8 percent in the first half. In 2015 retail turnover grew by 8.9 percent, with sales of food,
alcohol and tobacco rising by 19.1 percent. Sales of non-food goods grew by 2.8 percent. Sales of marketed
services grew by 9.5 percent. Increases in public-sector wages in December 2015 and the VAT reduction from 24
percent to 20 percent in January 2016 has boosted consumer demand in 2016, and some of this will spill over to
imports.
Total agricultural imports in Romania reached a total level of U.S. $ 6.7 billion in 2015. The major food product
import categories are meats, grains, protein meals, dairy, edible fruits, and sugar. Total consumer oriented
agricultural products imports in Romania were U.S.$ 3 billion in 2015.
Exporters should take into consideration the fact that in most of the food sectors there are well- established brands,
and to successfully enter the market might require significant marketing funds directed to consumer
communication. It is essential to visit the market to conduct market research, especially for product testing, price
comparisons, gauging competitors, preferences, etc. The products should be localized: products adjusted to local
tastes, in line with consumers’ preferences, and with a competitive price.
Romania is viewed as a market where consumers are prone to try different products. Romanian food shopping
has changed dramatically over the past years. They are more informed, more prone to follow foreign trends, have
become more selective, searching for the best cost benefit products.
The area harvested for tomatoes in Romania reached 40,967 hectare in 2016 hectare with annual diminishing in
the area since 2011 with annual average diminishing by -4.6%. the production of tomatoes also is diminishing
yearly since 2011 by average annual diminishing by -7.2%. Year 2016 witnessed strong diminishing in the
harvested area by -7.4% and at the meantime the production in the same year diminished by -10.6%.
Romania imports of tomatoes witnessing annual increase since the year 2012 until 2017, the imported quantity
almost doubled in the last five years and jumped from 41,395 tons in 2012 to reach 76,507 tons in 2017 to achieve
compound average growth rate in the last five years by 13.1%. The majority of supply since 2013 until 2016 was
coming from EU countries. The share of EU in supply of tomatoes to Romanian market reached 72.6% in year
2013. The market witnessed annual diminishing in EU share in supply to reach 53.6% in 2016. Turkey, Spain and
Albania are the major suppliers to the market; these countries acquired 66.5% of total supply to the Romanian
market in 2017.
In terms of supply value, the imported value of tomatoes in the Romanian market reached 88.7 million USD in
2016 by achieving 29% growth from the previous year and achieving 42% growth over the last five years. Romania
share in global import value of tomatoes is 0.9% and taking the rank number 20th among the top importing
countries.
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Egypt is not a known direct supplier of tomatoes to Romania. The market need to be discovered by the Egyptian
exporter of tomatoes who are able to be flexible in terms of supplying quantities and prices.
The average supplying price reached 991.0 USD/tons in 2018, the prices have decreased by -1.49% compared
to the price ranges in 2017. But the current price range still lower than the prices of 2015 and 2013 by -3.05% and
-1.38% respectively.
The revealed comparative advantage for export of tomatoes from Romania is too low. Romania does not have
any comparative advantage for exporting tomatoes.
Annual average consumption per capita in Romania has fluctuated from one year to the next (see the chart below).
The highest annual average of tomatoes consumption per capita was recorded in 2013 (40.0 kilograms per capita)
and the lowest was 35.26 kg/inhabitant. Regarding the monthly average of tomato consumption per person, at
national level and by residence area, it was found that it varied from one year to another.
The highest consumption is registered in the urban environment as opposed to rural areas. The amount of
tomatoes purchased by a household by residence area varied from one year to the next in the analyzed period. In
2016 there is a decrease (-5.4%) of the tomatoes quantity purchased at national level. The biggest quantity of
tomatoes purchased was recorded in 2013 (0.859 kg), and the lowest was 0.699 kg (2017).
In Romania there are more than 1,700 modern retail stores which are structured in hypermarkets, supermarkets, cash&carry, discounters. One third of the total modern retail stores are in Bucharest; the following major cities by considering the number of modern retail stores are Ilfov, Brasov, Cluj, Timisoara. Modern retail continues to gain market share year by year, while traditional retailer numbers gradually decline. In 2012 modern trade and traditional trade has equal shares and starting 2012 modern trade share continued to grow.
In 2015 Romania registered the highest consumption growth rate since 2008 (9 percent), thus Romania being one of the most dynamic countries and one of the most attractive food and beverages markets in Europe. The latest salary increases plus VAT food reduction to 9 percent put money into consumers’ pockets, so modern retailers have many growth opportunities. The retail market continues to expand rapidly both in Bucharest and throughout the country.
7
PEST ANALYSIS
Political Environment
The Political System in Romania
The President is the Head of State and is elected by universal suffrage for a term of five years. The President is
also the Commander in Chief of the army and is responsible for protecting the Constitution. Under the Romanian
Constitution, the President acts as a mediator between the various centres of power in the country. The Prime
Minister is appointed by the President (and is usually the leader of the majority party) for a term of four years. The
Prime Minister is the Head of Government and holds executive power, including law enforcement and
management of the affairs of the country. The Council of Ministers is appointed by the Prime Minister.
The legislature in Romania is bicameral. The Parliament consists of: Senate (the upper house) having 137 seats
and the Chamber of Deputies (the lower house) having 332 seats. The members of both houses are elected by
direct, popular vote on a proportional representation basis to serve four-year terms. The executive branch of the
Government is directly or indirectly dependent on the support of the parliament, often expressed through a vote
of confidence. The Prime Minister does not have the power to dissolve the Parliament directly, but the President
can do so after consultation with the political parties represented in the Parliamnet. The people of Romania have
considerable political rights.
Government Stability
The world bank score for the political stability boundaries are 2.50 & -2.50, the score for Romania reached 0.27
in 2016, Romania ranked number 80 out of 194 countries.
Romania’s Political Turbulence Threatens Economic Growth; in 2018, By the end of this year, Romania is set to
become the largest economy in the Balkans - but experts warn that if political instability continues, it will struggle
to maintain the current momentum. Growth in Romania is now threatened by political instability and the conflicting
economic policies of the government.
Employment laws
Romania rank 11th largest labor force in Europe among 41 countries with 8.83 million people in 2017 according
to the World Bank estimations. Romania ranked the 27th highest unemployment rate in Europe among 41
countries by 5.9% in 2017 according to World Bank estimations.
Romania ranked 14th among the highest unemployment rates of youth out of 41 countries by 23.6% in 2017.
There are 2 types of employment agreements in Romania, no matter if the individuals are residents or non-
residents:
1- Employment agreement for indefinite period
2- Employment agreement for definite period
As a rule, the employment contract has to be concluded for an unlimited duration. The unlimited duration is a
measure of protection for the Employee. By way of exception for project-based work, the individual employment
contract may also be concluded for a limited duration, under the terms expressly provided by the law, maximum
number of defined employment agreement is 3 successive ones, and the maximum period is 36 months.
Regardless if the employers in Romania contract Romanian or foreign individuals, they must fulfill certain
obligations.
8
Tax Regulations
The standard profit tax rate is 16% for Romanian companies and foreign companies operating through a
permanent establishment (PE) in Romania. Resident companies are taxed on their worldwide income, unless a
double tax treaty (DTT) stipulates otherwise. Non-resident companies are taxed on all income derived from
Romanian taxpayers, regardless of whether the services are rendered in Romania or abroad. The profit tax due
for nightclubs and gambling operations is either 5% of the revenue obtained from such activities or 16% of the
taxable profit, whichever is higher.
Among the tax law changes affecting individual taxpayers is an income tax rate reduction to 10% but increased
social security contributions for employees (effectively because the social security contributions are transferred
from employers to employees).
Romania's tax legislation is particularly volatile, with tax increases and amendments to legislation often being
introduced at very short notice. In the current economic climate, the authorities are also especially vigilant about
protecting budget revenue.
Corruption Levels
Romania rank 13th among the highest corruption levels in Europe out of 41 countries according to the World
bank estimations in 2016, Romania score is 0.0, this indicators score boundaries are 2.50 & -2.50
Corruption is a serious problem in Romania and raises the risks of doing business in the country. Foreign investors
complain of complicated procedures, arbitrary application of rules and requests for bribes when resolving
administrative tasks related to business operations. The Romanian Criminal Code and other supporting laws
criminalize active and passive bribery, including bribery of foreign officials. A company can be held criminally
liable for corruption offenses committed by individuals acting on its behalf. The government, however, does not
enforce anti-corruption laws effectively and impunity is widespread. Early 2017 saw large numbers of protesters
take to the streets of Bucharest to protest a decree that would have shielded many officials from corruption
charges. The decree was ultimately rescinded. Petty corruption is a problem in Romania as irregular payments
and bribes are common practice. The law does not distinguish between bribes and facilitation payments, and gifts
and hospitality may be considered illegal depending on their intent and the benefit obtained.
Trade Regulations& Customs
Romania rank 28th among the highest trade openness markets out of 41 countries in EUrope according to the
World bank estimations in 2016, Romania score is 82.9, this indicator score boundaries are 405 & 49.
The Union Customs Code (UCC) was adopted in 2013 and its substantive provisions apply from May 1, 2016. It
replaces the Community Customs Code (CCC). In addition to the UCC, the EC has published delegated and
implementing regulations on the actual procedural changes.
Consecutively, starting in April 2016, Romanian Customs implemented a working schedule to develop and install
the electronic systems envisioned by the EU Customs Code. Presently, Romanian Customs has drafted 25
legislative orders to be signed by the President of National Agency for Fiscal Administration and published in the
local Official Journal in the near future. The new orders will impact procedures referring to: companies’ registration,
customs representation, origin of goods, taxation, special regimes and free-zones, temporary warehouses, re-
export notification and electronic signatures.
Most customs duties and value added tax (VAT) are expressed as a percentage of the value of goods being
declared for importation. Thus, it is necessary to dispose of a standard set of rules for establishing the goods'
value, which will then serve for calculating the customs duty.
9
Economic Environment
GDP and Inflation
Romania rank 33 out of 43 Europe countries in terms of the GDP current
Dollar per capita in 2016 by 2,188 USD. On the other hand, Romania is
the lowest inflation rate in Europe, Romania achieved negative inflation
"prie decrease” by 1.5% in 2016.
GDP growth continued at a strong rate in the fourth quarter in year-on-year
terms, although the pace moderated from the third quarter. While a
breakdown is not yet available, buoyant retail sales and declining
unemployment in Q4 suggest growth continued to be driven by household
consumption. The figure brought growth for 2017 to the highest level in
nine years. However, the current account deficit almost doubled from 2016
on surging imports. Robust growth likewise translated into surging profits
and declining Non-Performing Loans for Romanian banks, which bodes
well for credit provision. In January, new car registrations jumped, putting
the important automotive sector on a strong footing at the start of the year.
Meanwhile, the political situation remains
tense. In late February, there were large protests against the justice minister’s move to
seek the dismissal of the chief of the anti-corruption directorate. Unrest, if protracted,
could affect investor sentiment.
The economy should shift into a lower gear this year but nevertheless expand robustly,
driven by consumer spending, which will be restrained by rising inflation and more
moderate wage growth. Fixed investment growth is expected to gain steam on
increased disbursements of EU funds and healthy credit expansion. However, a
widening fiscal deficit limits the government’s room for maneuver in case of unexpected
shocks, while continuing political turbulence constitutes the main downward risk to the
outlook. FocusEconomics panelists expect growth of 4.5% for 2018, up 0.1 percentage
points from last month’s forecast. They see the economy expanding 3.6% in 2019.
n Q2 2017, the Romanian economy expanded by 5.9 per cent, compared to the same
period in 2016, according to a preliminary estimate by the National Institute of Statistics (INS). The figure marked
an acceleration from Q1’s 5.7 per cent expansion and vastly overshot the market’s expectations of a slowdown to
4.8 per cent.
Currency & Interest rates:
USD exchange rate declined in the last few months form 4.4LEU/USD to reach 3.8 LEU/USD in March 2018.
Romania ranked the 14th highest interest rate in 2015 among 41 countries in Europe by 4.27%. The exchange
rate of the Romanian LEU increased sharply against the USD and jumped from 3.2 LEU/USD in late 2014 to reach
its peak in 2017 at 4.4 LEU/USD.
the LEU start to recover again against the USD since the beginning of 2018, the exchange rate reached 3.8
LEU/USD in March 2018. At its monetary policy meeting on 7 February, the National Bank of Romania (NBR)
decided to raise the policy rate to 2.25% from 2.00%—the second rate hike in as many months. Moreover, the Bank
decided to increase the deposit facility rate from 1.00% to 1.25%, and it also raised the NBR lending facility
(Lombard) rate from 3.00% to 3.25%. It left the reserve requirement on both leu- and foreign-currency
denominated liabilities unchanged.
Year Value Change
2010 8,297 0%
2011 8,426 2%
2012 8,518 1%
2013 8,852 4%
2014 9,159 3%
2015 9,564 4%
2016 10,081 5%
GDP per capita in USD
2010 5.1%
2011 7.1%
2012 3.3%
2013 4.0%
2014 1.1%
2015 -0.6%
2016 -1.6%
2017 1.1%
Inflation rates
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Building inflationary pressures, together with booming economic activity, underpinned the Bank’s decision.
Inflation in December stepped up to a multi-year high of 3.3% from 3.2% in November, moving closer to the upper
limit of the Bank’s target range of 1.5%–3.5%. Faster core inflation was behind the acceleration in headline inflation,
which was also fueled by an increase in food and tobacco prices. Core inflation was again influenced by strong
economic momentum, rising wages and supply-side factors.
Credit accessibility:
Romania score of credit accessibility by private sector is 28.1 in 2016 that rank the country the lowest third country
in Europe in terms of credit accessibility . The best score was 227.2 for Cyprus and the lowest was 21.8 for
Belarus.
Money Supply M0 in Romania decreased to 61927.10 RON Million in January
from 63475.60 RON Million in December of 2017. Money Supply M0 in
Romania averaged 17554.44 RON Million from 1993 until 2018, reaching an
all time high of 63475.60 RON Million in December of 2017 and a record low
of 95.20 RON Million in January of 1994
Money Supply M1 in Romania decreased to 209306.90 RON Million in
January from 210741.70 RON Million in December of 2017. Money Supply
M1 in Romania averaged 94317.33 RON Million from 2004 until 2018,
reaching an all time high of 210741.70 RON Million in December of 2017 and
a record low of 21882.80 RON Million in January of 2005.
Money Supply M2 in Romania decreased to 349808.20 RON Million in
January from 350473.80 RON Million in December of 2017. Money Supply
M2 in Romania averaged 199411.23 RON Million from 2004 until 2018,
reaching an all time high of 350473.80 RON Million in December of 2017 and
a record low of 62118.30 RON Million in January of 2005.
Disposable income of buyers:
Romania rank 28th among the top 60 disposable income countries in the world.
The average annual disposable income reached 3,287.2 USD in 2016 by
increase.
Romania's Annual Household Income per Capita reached 3,287.40 USD in Dec
2016, compared with the previous value of 3,028.18 USD in Dec 2015. Romania's
Annual Household Income per Capita data is updated yearly, available from Dec
2001 to Dec 2016, with an averaged value of 2,991.61 USD. The data reached
an all-time high of 3,485.06 USD in Dec 2008 and a record low of 746.83 USD in
Dec 2001.
According to the last published data , Retail Sales of Romania grew 11.42 % YoY
in Jan 2018.
Year Value Change
2010 56 23%
2011 67 20%
2012 60 -10%
2013 67 12%
2014 75 12%
2015 66 -12%
2016 73 11%
2017 87 19%
Money Supply M2 in Romania/
average monthly in billion US$
2010 3,003
2011 3,305
2012 2,980
2013 3,230
2014 3,360
2015 3,028
2016 3,287
Romania Household Income
per Capita
11
Tax& Duties
Companies are directly responsible for determining and charging the correct Romanian VAT rates. These are set
by the government, although the EU set the broad rules for use of the standard, higher rate and reduced rates. The
EU does insist that the standard rate is at least 15%.
Applied VAT in Romania
Rate Type Which goods or services
19% Standard All other taxable goods and services. Standard VAT rate decreased from 20% to 19% on 1 Jan 2017
9% Reduced
Foodstuffs; pharmaceutical products; medical equipment for disabled persons; hotel accommodation; water supplies; restaurants and catering services (includes supply of food in bars, cafes and nightclubs); some beer; soft drinks; cut flowers and plants for food production; some agricultural supplies.
5% Reduced Social housing; books (excluding e-books); newspapers and periodicals; admission to cultural events; admission to sporting events.
0% Zero Intra-community and international passenger transport.
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Social Environment
Demographics
Romania is the 10th largest population inEurope by 19.7 million
resident in 2016 according to the estimations of worls bank.
In 2030, the population of Romania will reach 18.3 million, a decrease
of 7.8% from 2015. This ongoing depopulation, which has been taking
place since the fall of communism, is due to continued negative net
migration, increasing death rates and falling birth rates. The
population will continue to age rapidly in 2015-2030 due to large
declines in all population groups under 49 years and by 2030
Romania will be the 21st oldest country in the world by median age.
Romania is a small country that is constituted of 84.1% Ethnic
Romanians from its total population while a small Hungarian minority
makes up 5.4% of the population demographics.
As of early 2014, the population of Romania was around 21,595,302,
a slight decrease from the estimated 21,668,721 in 2013 and from the
2011 population estimates when the figure stood at 21,801,942.
Romania's population is
actually decreasing at a rate of
0.32% per year. According to historical figures, Romania actually hit its
population peak in the early 90s, when there were 23,372,101 people in
Romania. In 2018 the population is estimated at 19.58 million.
The age structure of Romania is skewed heavily towards its inhabitants in
the 25-54 year age group. They make up around 45.1% of the population.
The younger generation in the 0-25 year age bracket also has a significant
majority in the country with 27.1%. These are encouraging numbers, which
show that Romania has a thriving work force and an upcoming generation
available for its development, provided it can create suitable opportunities
for its inhabitants to help develop it further in the long run. Moreover, the
population of senior citizens in Romania (people 55 years and over) also
make up a significant portion of the country's population at 27.8%. This
population spread also shows that Romania has a very uniform distribution of its population in all age brackets
except the 25-54 year olds.
Year Population Growth
2010 20,440,000 -0.86%
2011 20,293,000 -0.72%
2012 20,171,000 -0.60%
2013 20,068,000 -0.51%
2014 19,973,000 -0.48%
2015 19,876,000 -0.48%
2016 19,778,000 -0.50%
2017 19,679,000 -0.50%
Romania Population
13
Cross-cultural communication
Cross –Cultural communication
Note
Greetings
- Man greeting Man – If it is a new acquaintance, men will most likely shake hands. If it is a friend, many will grasp hands and then hug. Some good friends and family may also kiss on both cheeks.
- Woman greeting Woman- If it is a new acquaintance, they can shake hands, if one of them initiates by extending her hand. If it is a friend, they will kiss on both cheeks, and if a good friend, they may also hug.
- Greetings between Men & Women- If it is a new acquaintance, and the woman is older, very often men will kiss her hand as a sign of respect. They can shake hands, but the woman must initiate by extending her hand first. If it is a friend, they will kiss on both cheeks, and if a good friend, they will also hug.
Note: Usually, young people say "buna ziua" to older men which means "good day" and to women "sarut mana" that means “I kiss your hand" but people say it in a hurry, so it sounds like "sarumana" . People do not say “sarut mana" to men, only to priests. The youth greet with "salut", “servus" or even “hello" or "hallo".
Communication Style
- Romanians tend to be very polite and hospitable, so they will always take time to ask about one’s family and make other small talk before getting to the business at hand.
- They are generally direct about what they feel, but can be very indirect when talking about ideas and plans. There are many cultural reasons for this. To really understand, it is a good idea to ask questions and tactfully ask for more information, at least up to a point.
- Some people are direct and say exactly what they mean, and others take a more indirect path.
- If you are asking for directions most people will be happy to help you. But this depends from city to city, for example in Bucharest , people may not be as open to helping out.
Eye Contact
- Direct eye contact is preferred. Some people could say that you are not listening if you are not making an eye contact, and get upset.
- In a professional setting amongst colleagues, direct eye contact is acceptable and in most cases, expected.
Personal Space & Touching
- An arms length of personal space is the norm during conversations. This space may decrease when speaking with friends and family.
- Touching of the arms and shoulders is common during conversations. Touching and hugging is more common with friends as well as family.
Views Of Time
- raditional Romanian hospitality requires that much time is devoted to friendly conversation and taking time to visit, rather than adhering to set schedules or agendas.
- In more modern business settings, people are beginning to be prompt and pay attention to the time.
- There is no point in getting upset if people are a little late, or very late, and “immediate” can sometimes mean a long wait.
- Trains frequently run late. The rails are gradually being upgraded, but often they do not allow for speedy transit.
14
- Depending on the city, buses may have schedules, but in most towns the bus runs are more sporadic and people learn to be patient.
- Most people are not in too much of a hurry except when they are driving. - You might hear the word "immediate" that means "I'm coming right away" but you
may want to ask where the person is, to be sure they are really on their way. Usually they say "immediate" when they are still at home.
- There are also some institutions where punctuality is expected, for example schools, not all of them but most.
- Romanians, although late almost all the time, tend not to be patient and usually don`t like to wait.
Gestures
- One is expected to give up one's seat in public transport for the elderly or very young.
- In some homes shoes are removed indoors and people put on slippers, or “papoosh”, and visitors will be strongly encouraged to wear them as well.
- If you point to something, you point with one finger but if you want to be more subtle, you can just stretch your head, or move your eyes in the direction you want to point.
- When you beckon someone you move you whole hand toward yourself. in a downward motion.
- When you wave goodbye, you move your hand from left to right, or, you close your hand and open it, so that the outside part of the hand is toward you.
- Holding the door for the person following you, or even helping a person with overweight baggage is a sign of politeness, but it is not expected.
- In traffic, when you give someone right of way, it is polite to say thank you by nodding the head, or showing one hand.
- At school, when you want to answer, you raise your hand, and hold two fingers, just like the “ peace “ sign.
- For approving something, or saying "ok", you just raise your thumb. - If you`re going to a store, always say hello and bye to the vendor, and thanks after
you buy something.
Business Dress
- For Men: Dark suit, white shirt, and a tie with polished shoes.
- For Women: Elegant style is common. Business suits, usually with a skirt and
preferably with high heels.
TITLES & BUSINESS CARDS
- Mr. and Mrs.are common title. Mr. means “domn" and Mrs. means “doamna". Some people combine title them like Mr. Doctor (domnul doctor ) or Mrs. Lawyer.
- Business cards are usually presented with one hand and holding it between two fingers, like a cigarette.
Meetings
- Meetings are generally taken seriously and it’s best to be on time. - It is common to greet the highest ranking person first. - Some small talk is usually expected. It's best to allow the host to dictate the
business discussion. - The main purposes of initial meetings are to get to know one another and discuss,
not to always make decisions. It's best to go with the flow and not impose your agenda too forcefully.
Negotiations
- Romanians tend to take time when negotiating and expect some give and take in the bargaining sessions. It's best not not rush them or appear impatient. Expect a great deal of time to be spent reviewing details before a final decision is made.
- Decisions are generally made from the top down and once a decision is made and terms are agreed upon, making any further changes can prove difficult.
Gift Giving - Gifts are not generally exchanged at initial business meetings.
15
Consumer behavior
According to the PMR study on the food retail market of
Central Europe (Bulgaria, Czech Republic, Hungary,
Poland, Romania and Slovakia)-EC, food sales in 2011
have achieved a level of 107 billion euro, in a 2.8%
increase from previous year. The increase was due
mainly to the increase of sales in supermarkets and
discount stores, and to food price rise. The most
important economic operator in grocery retail is the
Schwarz Group, owner of Lidl and Kaufland stores.
Retail food market in the EC has lost 5.5 billion euro
during 2007-2010, due to the economic crisis and to the
decline of national currencies. The forecast for 2014 is
optimistic; the food retail market is estimated at 17 billion
euro. . According to the estimates, all forms of traditional
trade will be affected by the growth of online commerce,
evaluated in 2014 to 0.6% at European level. In the year 2013 Romania has exceeded the European average in
electronic commerce, registering an increase of 4.3%. In June 2014, the European retail has made an increase of
2.5%.
According to Dabija and Alt (2012), the emergence and
development of the modern commercial sector in
Romania is marked by the establishment of the network of
supermarket stores La Fourmi (1991), followed by the
opening of Mega Image stores in 1994. In 1996 the
network of Metro Cash & Carry stores began to operate
through the unit in Otopeni. A forecast of the year 2014 for
the retail market in Romania provides a value of 26 billion
euro; the national sector performance is being the best in
Europe. The study conducted by Gfk, the largest market
research company at the local level, states that in 2014 a
slight decrease in the pace of economic growth in the area
of trade will take place.
- If invited over for dinner or a drink to a Romanian home, you should always bring a gift. Either a bottle of high quality imported wine, liquor, flowers or a dessert/candy is acceptable.
- Always give flowers in odd numbers as even ones are usually given at funerals. - Gifts tend to be opened when received.
19.40% 20.80% 21.10%
16.30% 18.20% 20.10%9%
12.60%16.50%
55.40% 48.30% 41.90%
2 0 0 8 2 0 1 1 2 0 1 5
C H A N G E I N T H E S H O P P I N G P A T T E R N O F R O M A N I A N C O N S U M E R S
Hypermarkets Supermarkets
discount stores open markets & others
Fruits 2013 KG 2014 KG Growth
Fruit and fruit products in fresh
fruit
equivalent 73.2 80.2 9.6%
Apples 23.5 25.1 6.8%
Plums 4.5 4.7 4.4%
Apricots 1.6 2.2 37.5%
Cherries - sour cherries 4 4 0.0%
Peaches – nectarines 3.1 4.1 32.3%
Grapes 6.7 6.2 -7.5%
Southern and exotic fruits 23.1 25.7 11.3%
Other fruits 7.2 8.1 12.5%
Melons 25.4 21.8 -14.2%
Average annual consumption per capita in Romania
Source: food report Romania 2016
16
Over the last three years, Romania has seen strong positive
growth, with encouraging developments in the economic and
policy areas, becoming one of the most attractive markets in
Southeastern Europe. After just a few notable events during
2015, the Romanian retail market experienced remarkable
growth in 2016 reaching 2,000 stores operated by
international retailers. As modern retail systems grow.
Romania's food sector is expected to be among the regional
best performers during the next five years, with promising
market prospects for exporters of FFV.
In regards to consumption of fresh fruit and vegetables,
according to Eurostat 65.1% of Romanians aged 15 or over
do not eat fruit and vegetables on a daily basis compared to
34.4% the EU average. Some 31.5% eat 1 to 4 portions of fresh fruit and vegetables a day compared to the EU
average of 51.4%, while only 3.5% of Romanians eat at least 5 portions daily compared to 14.1% at EU level.
According to players in the market, a
Romanian consumes annually about 2.2
kilograms of canned vegetables.
the local consumption of vegetables and
vegetable products in fresh vegetable
equivalent increased by 3.9% in 2015
compared to 2014.
According to the Packaged Food in Romania
Report published by Euromonitor in January
2016, the sales of packaged processed fruits
and vegetables in Romania have recorded
62 thousand tonnes in 2015, up by 1%
compared to 2014. The volume sales of
packaged processed fruits and vegetables in Romania have registered a Compound Annual Growth Rate of -0.5%
in 2010 - 2015.
Distribution of Income
Romania is the best 11th country in the income equality distribution all over the world by GINI index of 27.5
significant quality income distribution in Romania, the GINI coefficient rank romania in the the 11th top equality
by 27.5. As the score close to 0 as the equality of income, distribution is high, as it is close to 100 as the ine quality
of income distribution is very high.
Happiness Index:
ROMANIA achieves a Happy Planet Index Score of 28.8 and ranks 55th of all over the world. According to the
world happiness report” Romania ranked 25th most happy country in Europe among 41 countries with score 5.82
The score boundaries are 0 to 10, where 0 is the less happiness and 10 the maximum happiness.
product 2013 KG 2014 KG Growth
Potatoes 103 100.8 -2.1%
Dried pulses 3.3 3.1 -6.1%
Vegetables and vegetable products
in fresh vegetable equivalent 152 158 3.9%
Tomatoes 35.4 38.1 7.6%
Dry onion 20.6 20.6 0.0%
Brassicas 44.7 44.2 -1.1%
Edible roots 12.4 13.6 9.7%
Green peppe 11.5 12.1 5.2%
Green peas 1 1.3 30.0%
Green beans 2.8 2.8 0.0%
Cucumbers 7.2 8.4 16.7%
Other vegetables 16.4 17 3.7%
Average annual consumption per capita in Romania
Source: food report Romania 2016
17
Human Development:
Human development indicator calculated by the United nations, it is described by value between 0 and 1 where 0
is the less human development countries. Romania ranked the 1oth worst country in Europe for human
development with score 0.802 that lower than the europe average (0.853).
The Human Development Index measures three basic dimensions of human development: long and healthy life,
knowledge, and a decent standard of living. Four indicators are used to calculate the index: life expectancy at
birth, mean years of schooling, expected years of schooling, and gross national income per capita. The world
average for 2015 was 0.701 points. The highest value was in Norway: 0.949 points and the lowest value was in
the C.A. Republic: 0.352 points.
Age dependency ratio:
Romania is the 25th highest age dependency in Europe by 49.54% of the work force in the country. Age
dependency ratio is the ratio of dependents--people younger than 15 or older than 64--to the working-age
population--those ages 15-64. The average in EUrope for 2016 was 50.31%t. The highest value was in France:
61% percent and the lowest value was in Moldova by: 35%.
The dependency ration of Romania less partially then the average in Europe ; it is a good advantage for the country
and give good space for more expendature of quality products.
18
Technology Environment
Port traffic & infrastructure
Romania rank 19th highest port traffic in Europe in 2014 according to “Containerization International”. Romania
is the 7th worst port infrastructure in Europe with score 3.42 out of 7 in 2015.
Romania has average port traffic in Europe in comparison with the other European countries. Romania rank is
19th by 775,742 container in 2014, it comes after Ukraine and Ireland. And comes before Slovenia and Austria.
Romania is keeping the same rank since 2010.
The infrastructure of the ports in Romania ranked the country among the worst 2 ports infrastructure in Europe.
This definitely affecting the cost of the service, the safety and the time required to process the consignment.
Railway transport of goods:
Romania is the 11th top railway transport of goods in Europe by 10,598 metric tons times the kilometers traveled.
Railway network for moving goods in Romania is quite good for moving goods across the country and to the other
boarder countries.
Road transportation
Romania has the 7th biggest railroad lines in Europe by 10,799km. Romania ranked the 5th worst road
transportation in Europe with score 2.56 out of 7. Despite Romania has large railroad network as the country
considered the the 7th largest road network in Europe, but it is one of the worst roads in Europe.
19
ENABLING TRADE Overview
Romania’s economic freedom
score is 69.4, making its economy
the 37th freest in the 2018 Index. Its
overall score has decreased by 0.3
point, with lower scores for
government integrity and property
rights outweighing improvements in
the indicators for labor freedom and
government spending. Romania is
ranked 19th among 44 countries in
the Europe region, and its overall
score is above the regional and
world averages. By 2015, after
macroeconomic stability had been
restored in Romania, the
government yielded to political
pressure to relax fiscal policy, raise
the minimum wage, and delay
additional structural reforms. Efforts
to privatize state-owned enterprises
have stalled, and progress on
improving the business environment has been uneven. Significant tax evasion further jeopardizes the fiscal deficit
and public debt burden. Foreign investors find the
unpredictable regulatory system discouraging. Cor-
ruption is endemic at all levels of government and
undermines the rule of law.
Trade is significant for Romania’s economy; the com-
bined value of exports and imports equals 84 percent
of GDP. The average applied tariff rate is 1.6 percent.
Nontariff barriers impede some trade. In general, gov-
ernment policies do not significantly impede foreign
investment. The evolving financial sector is open to
competition, and foreign-owned banks dominate the
banking sector. The number of nonperforming loans is
down considerably from their peak in 2013.
Formal regulations prohibiting monopolies do exist,
but the Competition Council and other market arbiters,
in principle fully in line with EU rules, have sometimes
been more timid in reality than they should be. In the last few years, the Competition Council took on a more active
role, investigating cartels in various sectors and sensitive strategic markets, such as energy, have made steps to
liberalize the market and render it more transparent. The market for public works and, increasingly, ITC services
provided for public institutions raise questions in terms of political connections undermining competitiveness.
20
With EU
accession,
Romania has
become a full
member of the
common market.
All restrictions
imposed by tariff
and non-tariff
trade barriers
have thus been
abolished, and
there have been
very few
exceptions from
this regime in the past years, all in line with EU norms. Inside the EU, Romania’s position has been largely in favor
of the free trade agreements with United States, Canada and East Asia, as well as for the intra-EU liberalization
of services.
21
Most problematic factors for exporting to Romania
High cost or delays caused by domestic transportation, Burdensome import procedures and Tariffs and non-tariff
barriers are the most problematic factors for exporting to Romania according to “Executive Opinion Survey” of the
world economic forum.
Most problematic factors for exporting from Romania
Exporting from Romania is facing many challenges, the major challenges the exporters facing are Identifying
potential markets and buyers, Access to trade finance and High cost or delays caused by domestic transportation.
High cost or delays caused by domestic transportation
Burdensome import procedures
Tariffs and non-tariff barriers
High cost or delays caused by international transportation
Domestic technical requirements and standards
Inappropriate telecommunications infrastructure
Crime and theft
Corruption at the border0 5 10 15 20 25
21.1
19.5
17.9
13.1
13
6.7
4.9
3.8
Identifying potential markets and buyers
Access to trade finance
High cost or delays caused by domestic transportation
Access to imported inputs at competitive prices
Inappropriate production technology and skills
Technical requirements and standards abroad
Difficulties in meeting quality/quantity requirements of buyers
Burdensome procedures at foreign borders
High cost or delays caused by international transportation
Rules of origin requirements abroad
Tariff barriers abroad
Corruption at foreign borders0 4 8 12 16 20
11.7
18.5
13.4
12.6
1.1
0.9
11.5
8.6
8
5.2
4.9
3.7
22
PRODUCT BRIEF
Product Definition
Scientific name: Solanum lycopersicum
HS codes: 070200
tomatoes, fresh or chilled
Varieties
- Big Beef Tomato (Solanum lycopersicum 'Big Beef')
- Waltham Tomato (Solanum lycopersicum 'Waltham')
- Red seedless Tomato (Solanum lycopersicum 'Red seedless')
- Red Globe Tomato (Solanum lycopersicum 'Red globe')
- Larochelle Tomato (Solanum lycopersicum 'Larochelle')
- ErliHanne Tomato (Solanum lycopersicum 'ErliHanne')
- Dalphine Tomato (Solanum lycopersicum 'Dalphine')
- Dan Ben Hanna (Solanum lycopersicum 'Dan Ben Hanna')
- Blen-Ben-Hann (Solanum lycopersicum 'Blen-Ben-Hann')
- Bonheur Tomato (Solanum lycopersicum 'Bonheur')
- Barlinka Tomato (Solanum lycopersicum 'Barlinka')
- Alphonso La Valee (Solanum lycopersicum 'Alphonso La Valee')
- Salad Tomato (Lycopersicon lycopersicum 'Salad')
- Slicing Tomato (Lycopersicon lycopersicum 'Slicing')
- Cherry Tomato (Lycopersicon lycopersicum 'Cherry')
- Romania Tomato (Lycopersicon lycopersicum 'Romania')
- Rosa Tomato (Lycopersicon lycopersicum 'Rosa')
- Premio Tomato (Solanum lycopersicum 'Premio')
- Cherokee purple Tomato (Solanum lycopersicum 'Cherokee purple')
- Brandywine Tomato (Solanum lycopersicum 'Brandywine')
23
Romania is a key player in the fresh tomatoes market either on the production side or on imports side, Romania
ranked top 32 producers of tomatoes with share of 0.35% of global production and ranked top 20th importer in the
world with value imported share 0.90 of global trade in Tomatoes.
Local Production
The area harvested for tomatoes in Romania reached 40,967 hectare in 2016 hectare with annual diminishing in
the area since 2011 with annual average diminishing by -4.6%. the production of tomatoes also is diminishing
yearly since 2011 by average annual diminishing by -7.2%.
Sharp diminishing in the harvested area by tomatoes in
Romania by -21% in the previous five years. the harvested area
diminished from 49,620 Hectare in 2012 to 40,967 hectare in
2016.
The production of tomatoes in Romania facing sharp
diminishing over the last five years by -7.2% on average
annually. In year 2016 the production diminished from 701,800
tons to 627,177 tons only. The production diminished by
-10.6%
Production Volume 627,177 Metric Ton in 2016
Last year -10.60%
Last 3 years -16.30%
Last 5 years -31.15%
24
The hot production season in Romania started in June until October; the early production comes from end of April
until early June. The late production covers the months from mid of October until mid of November.
Both the production and
harvested area reached its
peak in 2011, in this year the
harvested area reached
51,745 hectare and the
production reached 910,978
tons. Since this year both the
harvested area and
production has a general
diminishing trend until 2016
with slight positive increase
in year 2013.
Year 2016 witnessed strong
diminishing in the harvested
area by -7.4% and at the
meantime the production in the same year diminished by -10.6%. given that the diminishing rate in the production
is higher that the
diminishing rate in
harvested area, we can
conclude that productivity
of the hectare is slowing
down.
On the other hand, the
local production price
increased over the last five years by 6% and increase in the last year by 5.1%.
25
Romania Imports of Tomatoes
Romania imports of
tomatoes witnessing
annual increase since
the year 2012 until
2017, the imported
quantity almost
doubled in the last five
years and jumped from
41,395 tons in 2012 to
reach 76,507 tons in
2017 to achieve
compound average
growth rate in the last
five years by 13.1%.
On the other hand, a dramatic
change in the direction and source of
supply to the Romanian market over
the last five years. the majority of
supply since 2013 until 2016 was
coming from EU countries. The
share of EU in supply of tomatoes to
Romanian market reached 72.6% in
year 2013. The market witnessed
annual diminishing in EU share in
supply to reach 53.6% in 2016. In
2017 the supply from countries
outside EU overcame the supply
from EU and acquired 58.3% rom market compared to only 41.2% to the supply form EU countries.
11th top ranked EU importing country of fresh tomatoes, 2.57%
share in the EU imports of fresh tomatoes in year 2017
Despite the imports achieved slight low growth in year 2017 by
0.21%, but over the last five years the average annual growth
rates hiked 10.8%
Imports volume
performance 76,506 Metric Ton in 2017
5 years CAGR 10.78%
Last year 0.21%
Last 3 years 39.74%
Last 5 years 84.82%
26
Turkey, Spain and Albania are
the major suppliers to the
market; these countries
acquired 66.5% of total supply
to the Romanian market in
2017.
The share of supply from both
Turkey and Albania is growing
rapidly, the supply from Turkey
jumped from 24.8% of total
supply to Romanian in 2013 to
reach 49.1% in 2017. On the
other hand, the supply from
Albania jumped from 0.8% in
2013 of total supply to
Romanian market and reached 8.4% in 2017.
The supply from Spain and Italy diminished dramatically in the last five years. the supply from Spain dropped from
15.4% of total supply to Romanian market in 2012 to reach 8.8% of market in 2017; however, the supply from Italy
dropped from 17.4% in 2012 to reach 8.3% in 2017.
In terms of supply value, the
imported value of tomatoes in
the Romanian market reached
88.7 million USD in 2016 by
achieving 29% growth from
the previous year and
achieving 42% growth over the
last five years. Romania share
in global import value of
tomatoes is 0.9% and taking
the rank number 20th among
the top importing countries.
Dramatic change in source
of supply has been
witnessed, the supply
switched from EU countries
to non-EU countries from
2015. In terms of value,
Turkey is dominating the
market by 31.5% of total import value in 2016, followed with Spain and Italy. Despite the supplying quantity form
both Spain and Albania are equivalent, but the import value from Italy is three times the import value from Albania.
27
The supplying concentration for the imported tomatoes to the Romanian market is medium; because the
dominating supplier in the market only acquire
49% of imported quantity to the market and only
31% of imported value to the market.
The market is very price sensitive and is open for
any other supplying countries that can offer good
prices with accepted quality.
Egypt is not a known direct supplier of tomatoes
to Romania. The market need to be discovered by
the Egyptian exporter of tomatoes who are able to
be flexible in terms of supplying quantities and
prices; and also who are able to handle the
logistics in that way that makes the shipping time and cost at the minimum and keep the products in the agreed
quality level.
The average supplying price
reached 991.0 USD/tons in 2018,
the prices have decreased by
-1.49% compared to the price
ranges in 2017. But the current
price range still lower than the
prices of 2015 and 2013 by
-3.05% and -1.38% respectively. Increasing supply from the exporting markets to the Romanian market and the
transformation of Romania form production to the import of Tomatoes will lead for more import price cuts in the
future due to increasing the competition either form the suppliers of the same country or the suppliers from different
countries.
28
Romania Exports of tomatoes
Romania is not recognized as an exporter of tomatoes, the export quantity is not reaching 500 tons in either 2016
or 2017. Around 70% of exports go for Moldova, Netherlands and Hungary. Two of them are boarder countries.
The majority of exports take place during the production season of Romania; this means Romania is not a transit
hub for any boarder countries.
Romania Export value
diminished in 2016 by -49% to
reach 629,000 USD, over the
last five years the export value
diminished by more than -65%.
Globally, Romania share in the
global exports of tomatoes is
less than 0.01% and ranked
number 89 among the global
exporting markets.
The revealed comparative
advantage for export of tomatoes
from Romania is too low.
Romania does not have any
comparative advantage for
exporting tomatoes.
As a conclusion, Romania is
switching from producing
country into a net importing
country of tomatoes, over the
last years Romania has increasing trend of importing tomatoes from non-EU countries. This means there is a good
opportunity for the world suppliers especially if the months before June and after October.
29
Consumption
Annual average consumption per capita in Romania has fluctuated from one year to the next (see the chart below). The highest annual average of tomatoes consumption per capita was recorded in 2013 (40.0 kilograms per capita) and the lowest was 35.26 kg/inhabitant. In 2017, the annual average consumption of tomatoes decreased by 11.8% compared to 2013.
Regarding the monthly average of tomato consumption per person, at national level and by residence area, it was found that it varied from one year to another.The highest consumption is registered in the urban environment as opposed to rural areas. The highest monthly average consumption of tomato per person in the urban area was registered (0.9625 kg / inhabitant), and in the rural area was 0.9311kg/inhabitant.
The amount of tomatoes purchased by a household by residence area varied from one year to the next in the analyzed period. In 2016 there is a decrease (-5.4%) of the tomatoes quantity purchased at national level. The biggest quantity of tomatoes purchased was recorded in 2013 (0.859 kg), and the lowest was 0.699 kg (2017). From the data presented, it can easily be noticed that the situation in the residence area is different. In the urban area, the amount of tomatoes purchased by a household is definitely superior to that purchased in rural areas. This is explained by the fact that part of the rural population produces in their households the tomatoes required for consumption. In winter, when imported tomatoes are generally eaten, rural households buy a small amount of tomatoes because of high prices for the category of tomatoes and, on the other hand, the small incomes of these households. In 2015, in the urban area, there is a 3.1% decrease in the quantity of purchased tomatoes. This decline can also be explained by the fact that consumers in the urban area acquire other categories of imported vegetables. In rural areas, in 2015, the amount of tomatoes purchased by a household accounted for only 44.6% of the amount purchased by the urban population.
Romanian tomatoes market has multiple weaknesses. In the analyzed period (2011-2017), the area cultivated with tomatoes and production decrease. Regards from area decreased in 2015 with 15.1%. Also, total tomatoes production decreased with 14.7% and average production registered the same trend. The most significant average production per hectare of tomatoes was obtained in 2011 (17,602 kg / ha). This made to increase quantitative imports of tomatoes and to decrease exports. As a result, the highest average annual consumption per capita of tomatoes was achieved in 2013 (40 kilograms per capita). The highest average annual per capita consumption was recorded in urban areas as opposed to rural areas. The quantity of tomatoes purchased by residential household has recorded oscillations by year to year. Also, the highest average price was registered in 2012 (3.06 lei / kg). The average monthly expenditure per person for the purchase of tomatoes increased by 9.4% in 2017 compared to 2012.
30
Product Quality
This section presents UNECE Standard FFV-36 that is applied in the EU countries concerning the marketing and commercial quality control of tomatoes. This standard applies to tomatoes of varieties (cultivars) grown from Solanum lycopersicum L. to be supplied fresh to the consumer, tomatoes for industrial processing being excluded.
Tomatoes may be classified into the following commercial types:
• “round”;
• “ribbed”;
• “oblong” or “elongated”;
• Cherry/cocktail tomatoes (miniature varieties) of all shapes.
Quality of tomatoes
The purpose of the standard is to define the quality requirements for tomatoes at the export-control stage after preparation and packaging. However, if applied at stages following export, products may show in relation to the requirements of the standard:
• A slight lack of freshness and turgidity
• For products graded in classes other than the “Extra” Class, a slight deterioration due to their development and their tendency to perish.
The holder/seller of products may not display such products or offer them for sale, or deliver or market them in any manner other than in conformity with this standard. The holder/seller shall be responsible for observing such conformity.
1. Minimum requirements
In all classes, subject to the special provisions for each class and the tolerances allowed, the tomatoes must be:
Intact
Sound; produce affected by rotting or deterioration such as to make it unfit for consumption is excluded
Clean, practically free from any visible foreign matter
Fresh in appearance
Practically free from pests
Free from damage caused by pests affecting the flesh
Free of abnormal external moisture.
Free of any foreign smell and/or taste.
In the case of trusses of tomatoes, the stalks must be fresh, healthy, clean and free from all leaves and any visible foreign matter.
The development and condition of the tomatoes must be such as to enable them:
To withstand transportation and handling
To arrive in satisfactory condition at the place of destination.
31
2. Maturity requirements
The development and state of maturity of the tomatoes must be such as to enable them to continue their ripening process and to reach a satisfactory degree of ripeness.
3. Classification
Tomatoes are classified in three classes, as defined below:
i. Class I: Extra class
Tomatoes in this class must be of superior quality. They must be firm and characteristic of the variety. They must be free from greenbacks and other defects, with the exception of very slight superficial defects, provided these do not affect the general appearance of the produce, the quality, the keeping quality and presentation in the package.
ii. Class I
Tomatoes in this class must be of good quality. They must be reasonably firm and characteristic of the variety.
They must be free of cracks and visible greenbacks.
The following slight defects, however, may be allowed provided these do not affect the general appearance of the produce, the quality, the keeping quality and presentation in the package:
• A slight defect in shape and development;
• Slight defects in colouring;
• Slight skin defects;
• Very slight bruises.
Furthermore, “ribbed” tomatoes may show:
• Healed cracks not more than 1 cm long;
• No excessive protuberances;
• Small umbilicus, but no suberization;
• Suberization of the stigma up to 1 cm2;
• Fine blossom scar in elongated form (like a seam), but not longer than two-thirds of the greatest diameter of the fruit.
iii. Class II
This class includes tomatoes that do not qualify for inclusion in the higher classes but satisfy the minimum requirements specified above.
They must be reasonably firm (but may be slightly less firm than in Class I) and must not show unhealed cracks.
The following defects may be allowed, provided the tomatoes retain their essential characteristics as regards the quality, the keeping quality and presentation:
• Defects in shape and development;
32
• Defects in colouring;
• Skin defects or bruises, provided the fruit is not seriously affected;
• Healed cracks not more than 3 cm in length for round, ribbed or oblong tomatoes.
Furthermore, “ribbed” tomatoes may show:
• More pronounced protuberances than allowed under Class I, but without being misshapen;
• An umbilicus;
• Suberization of the stigma up to 2 cm2;
• Fine blossom scar in elongated form (like a seam).
Sizing of tomatoes
Size is determined by the maximum diameter of the equatorial section, by weight or by count.
The following provisions shall not apply to
• trusses of tomatoes;
And are optional for:
• Cherry and cocktail tomatoes below 40 mm in diameter;
• Ribbed tomatoes of irregular shape; and
• Class II.
To ensure uniformity in size, the range in size between produce in the same package shall not exceed:
a) For tomatoes sized by diameter:
• 10 mm, if the diameter of the smallest fruit (as indicated on the package) is under 50 mm;
• 15 mm, if the diameter of the smallest fruit (as indicated on the package) is 50 mm and over but under 70 mm;
• 20 mm, if the diameter of the smallest fruit (as indicated on the package) is 70 mm and over but under 100 mm
• There is no limitation of difference in diameter for fruit equal or over 100 mm.
In case size codes are applied, the codes and ranges in the following table have to be respected:
Size Code Diameter (mm)
0 ≤ 20
1 > 20 ≤ 25
2 > 25 ≤ 30
3 > 30 ≤ 35
4 > 35 ≤ 40
33
5 > 40 ≤ 47
6 > 47 ≤ 57
7 > 57 ≤ 67
8 > 67 ≤ 82
9 > 82 ≤ 102
10 > 102
b) For tomatoes sized by weight or by count, the difference in size should be consistent with point (a).
Tolerances of tomatoes
At all marketing stages, tolerances in respect of quality and size shall be allowed in each lot for produce not satisfying the requirements of the class indicated.
1. Quality tolerance
Extra Class
A total tolerance of 5 per cent, by number or weight, of tomatoes not satisfying the requirements of the class but meeting those of Class I is allowed. Within this tolerance not more than 0.5 per cent in total may consist of produce satisfying the requirements of Class II quality.
Class I
A total tolerance of 10 per cent, by number or weight, of tomatoes not satisfying the requirements of the class but meeting those of Class II is allowed. Within this tolerance not more than 1 per cent in total may consist of produce satisfying neither the requirements of Class II quality nor the minimum requirements, or of produce affected by decay.
In the case of trusses of tomatoes, 5 percent, by number or weight, of tomatoes detached from the stalk is allowed.
Class II
A total tolerance of 10 per cent, by number or weight, of tomatoes satisfying neither the requirements of the class nor the minimum requirements is allowed. Within this tolerance not more than 2 per cent in total may consist of produce affected by decay.
In the case of trusses of tomatoes, 10 per cent, by number or weight, of tomatoes detached from the stalk is allowed.
2. Size tolerances
For all classes: a total tolerance of 10 per cent, by number or weight, of tomatoes not satisfying the requirements as regards sizing is allowed.
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Presentation of tomatoes
1. Uniformity
The contents of each package must be uniform and contain only tomatoes of the same origin, variety or commercial type, quality and size (if sized).
The ripeness and colouring of tomatoes in “Extra” Class and Class I must be practically uniform. In addition, the length of “oblong” tomatoes must be sufficiently uniform. However, a mixture of tomatoes of distinctly different varieties, commercial types and/or colours may be packed together in a package, provided they are uniform in quality and, for each variety, commercial type and/or colour concerned, in origin.
The visible part of the contents of the package must be representative of the entire contents.
2. Packaging
Tomatoes must be packed in such a way as to protect the produce properly. The materials used inside the package must be clean and of a quality such as to avoid causing any external or internal damage to the produce. The use of materials, particularly paper or stamps bearing trade specifications, is allowed, provided the printing or labelling has been done with non-toxic ink or glue.
Stickers individually affixed to the produce shall be such that, when removed, they neither leave visible traces of glue nor lead to skin defects.
Packages must be free of all foreign matter.
Marking of tomatoes
Each package must bear the following particulars, in letters grouped on the same side, legibly and indelibly marked, and visible from the outside.
1. Identification
Packer and/or dispatcher/shipper:
Name and physical address (e.g. street/city/region/postal code and, if different from the country of origin, the country) or a code mark officially recognized by the national authority.
2. Nature of produce
“Tomatoes” or “trusses of tomatoes” and the commercial type, or “cherry/cocktail tomatoes” or “trusses of cherry/cocktail tomatoes” or equivalent denomination for other miniature varieties if the contents are not visible from the outside.
“Mixture of tomatoes”, or equivalent denomination, in the case of a mixture of distinctly different varieties, commercial types and/or colours of tomatoes. If the produce is not visible from the outside, the varieties, commercial types and/or colours and the quantity of each in the package must be indicated.
Name of the variety (optional).
3. Origin of produce
Country of origin and, optionally, district where grown, or national, regional or local place name.
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In the case of a mixture of distinctly different commercial types and/or colours of tomatoes of different origins, the indication of each country of origin shall appear next to the name of the commercial type and/or colour concerned.
4. Commercial specifications
Class
Size (if sized) expressed as
o Minimum and maximum diameters; or
o Minimum and maximum weights; or
o Size code as specified in Section III; or
o Count followed by the minimum and maximum sizes.
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Product Trends and outlook
1- Despite the sharp drop in local production of tomatoes in Romania over the last five years, The Romanian
Ministry of Agriculture wants to increase the country's own supply of tomatoes and is putting 40 million
euro a year towards a program to enable this. So far, around 35 million euros have been spent in
Romania, according to authorities, to import 50,000 metric tonnes of tomatoes. In return, only around
3,000 metric tonnes worth two million euros will be exported. This is despite the fact that Romania farming,
climate-wise, is predestined for vegetable production and especially tomato production, according to
experts. That is why the foreign trade balance in the vegetable sector should change as a result of the
"tomato program" launched this year, which has initially been planned for eight years.
2- EU average tomato prices in March 2018 were 19% below the reference period average (5 preceding
years). That indicator is very different among EU Member States. 27% above average in IT, 23% below
average in ES, 6% under average in the NL and 5% below average in FR.
3- There is, therefore, a dual situation at MS level: price levels are very low in ES and IT and moderately
under average in FR and NL. Southern MS face increasing competition from early productions in Central
Europe thanks to technological advance. Imports from Morocco in the 1st quater of 2018 were at relatively
high levels when compared to the reference period.
4- When looking backwards, EU average tomato prices were at about the maximum level of the reference
period in November 2017; between December 2017 and January/February 2018 prices registered gradual
reductions until stabilizing in February and March at around the minimum level price of the reference
period. Provisional April prices show additional price reductions in ES and IT.
5- As an exception to the generally good market situation in 2017, the month of May was a difficult month
(the period between May to Aug in the case of NL) due to the importance of exports during that month
before the loss of the Russian market. A specific feature of the tomato market is that the level of prices
can change very quickly in a matter of 2 or 3 months from very high to very low or vice-versa.
6- Romanians become more and more aware about the importance of food quality and this creates a new
segment of customers that will be targeted with special menu offerings. This trend towards an improved
lifestyle and healthier products was not considered as a core development strategy for foodservice’s
strong brands. This changed when Salad Box was launched as a healthy fresh food alternative in fast
food, one of the categories with high rates of processed products. It is expected that other companies will
consider the growth potential represented by healthy fresh food, to improve their positioning and to
increase sales. New healthy concepts such as natural juice and smoothie bars, fresh soups, vegetarian
food and fruit mixes developed through street stalls or other formats are still possible. Organic menu
offerings represent the highest objective in healthy foodservice but for this to be present, important
transformations still need to take place.
7- Since is it expected that price will remain an important element when Romanians make a consumption
decision, best price or best value for money is the strategy used by many foodservice businesses. Special
prices, product offers, discounts for different parts of the day, daily menus or volume discounts are usually
used to generate sales. Although already popular, especially in many full-service restaurants, the daily
menu served at lunchtime is expected to consolidate to an industry standard. Their availability will expand
in the main city centres or in the areas near office buildings, but it can be predicted that their presence will
also increase within the smaller cities to generate new sales and a growth in transactions. Lunch time
remains the most important moment of the day for eating out during the week, lunch being the main meal
of the day. Breakfast is the least important meal of the day. According to market research, 30-40 percent
of Romanians forget about taking breakfast at home, sitting at the table, and are more likely to have the
morning meal as a snack on the go or a snack at work. This trend is visible especially in Bucharest and
the largest cities, with intense economic activity.
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8- Another new retail concept for 2015 is the specialised store Gusturi Romanesti (Romanian Tastes) run by
Mega Image. Last year Mega Image made a huge investment by opening a new concept store in north
Bucharest, Baneasa Shopping City, which has become the most successfull retail park in Bucharest. The
investment is estimated at U.S. $ 10 million. This is Mega Image’s largest store, with a sales area of 2,100
sqm, and it includes all dedicated sections / concepts that Mega Image has already tested in the other
stores plus a new concept – Fromagerie – that includes bulk cheese. According to market research
companies, foodstuffs account for two thirds of the total yearly shopping basket. Consumers have started
to pay more attention to premium products. For the first time within the last 3 years, uptrading has been
visible in 2015 as a market trend on the modern retail market, meaning the shift to a more expensive
product within the same category. More expensive product categories such as fish and seafood, dried
fruits, honey, breakfast cereals and cider all increased in 2015. In terms of consumer behavior, when
compared to previous years, Romanian people do not visit the stores as often but they spend more during
each store visit.
9- Romania has one of the biggest ecommerce markets in Southeastern Europe. The ecommerce market
was estimated to be worth around U.S. $ 1.53 billion in 2015, while it was worth U.S. $ 1.33 billion in 2014.
However, the share of ecommerce of total retail is still quite low, between 2.2 and 2.5 percent. In 2015
products from the food&beverages category were bought by only 5.2 percent of the total online buyers,
compared to clothing & shoes (37.6 percent), electronics (36.6 percent), and paying invoices (36.2
percent). Kaufland and Auchan have plans to enter online retail by 2017. Metro, Carrefour, MegaMarket
and Cora have online operations and Mega Image has a partnership with the largest online store, eMag.ro.
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COMPLIANCE FOR EXPORT Romania’s food laws and regulations have been harmonized with the European Union (EU) legislation. Romania, as a member of the European Union, follows the EU regulations therefore this report is recommended to be read in conjunction with the Food and Agricultural Import Regulations and Standards (FAIRS)
Fresh fruits and vegetables, are subject to EU quality norms, which mandate a quality inspection at the border of entry to the European territory prior to obtaining a customs clearance. In addition to the quality inspection, a systematic phytosanitary inspection is done on all shipments of fresh fruits to EU countries, including Romania. A phytosanitary inspection is not required for fresh vegetables. Certain fresh and processed fruits and vegetables are subject to import certificates (garlic, bananas, canned mushrooms and canned mandarins). In addition, current regulations require traceability of all produce from the producer to the consumer; thus, each handler must be able to supply information about its supplier or buyer.
As per EU regulations, certain fresh fruits and vegetables are subject to seasonal price restrictions. An import certificate is also required for canned mushrooms and canned mandarins.
Europe is very demanding about food safety, which is why dealing with fresh agricultural products is subject to various legal and other buyer requirements. But there are also opportunities to distinguish yourself by applying additional or niche market quality standards.
The provisions on food safety can be divided in two kinds of requirements.
- The first category consists of requirements that cover particular types of food products that due to their
product-specific characteristics require specific safety precautions. Fresh fruit and vegetables regulations
are (Regulation (EC) 1234/2007 in conjunction with Regulation (EC)1580/2007)
- The second category includes specific regulations that apply to a wide range of food products when specific consumer protection is considered necessary. Examples of important issues that are covered are:
o Residues pesticides (Regulation (EC) 396/2005) o Food labelling (Directive 2000/13/EC) o Microbiological contamination (Regulation (EC) 2073/2005) o Contaminants (Regulation (EC) 1881/2006) o Additives (Regulation (EC) 1333/2008) o Irradiation (Directives 1999/2/EC and 1999/3/EC) o Flavourings (Regulation (EC) 1334/2008)
The measures on enforcement and control do not contain actual requirements for products, but set measures to ensure safety of food products placed on the market. They cover hygiene (HACCP) (Regulation (EC) 852/2004), official controls on food products (Regulation (EC) 882/2004) and traceability. There are different control procedures for food of animal origin and food of non-animal origin.
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A. Legal & Non-Legal requirement the product must comply with
Limited use of pesticides
Romania follows the provisions of the EU Regulation no. 396/2005 on maximum residue levels of pesticides in or on food and feed of plant and animal origin with its subsequent amendments. In Romania there are three competent authorities involved in the program of elaborating and implementing the control of pesticide residues:
National Sanitary Veterinary and Food Safety Authority, which yearly approves the frequency of testing for pesticide residues in food of plant and animal origins. National Institute for Veterinary Public Health is responsible for conducting tests for determining the presence and level of these pesticides in foodstuffs.
Ministry of Agriculture and Rural Development, which yearly approves the national monitoring plan for pesticide residues in fruits, vegetables and grains from domestic production. The plan is implemented by the Laboratory for Pesticides Residues Control in plants and crop material.
Ministry of Health, which is responsible for the control of pesticides residues in food for special purposes, as part of the Program for public health protection by preventing diseases associated with food and nutrition risk factors.
The same three authorities listed above are responsible for approving the testing frequency and the testing methods for contaminants, such as aflatoxin, ochratoxin A, cadmium, lead, 3-MCPD, nitrates etc. Specific laboratories, such as National Institute for Veterinary Public Health, are responsible for conducting tests for determining the presence and level of these contaminants in foodstuffs. The maximum levels are provided in the annex of the EU Commission Regulation 1881/2006 setting up the maximum levels for certain contaminants in foodstuffs.
The tests required by the legislation to be performed on the domestic and imported food products are in general at the expense of the domestic producer/importer, except for animal origin products in case of disease enlisted in the Surveillance and Monitoring Program issued by the Veterinary and Food Safety Authority and which case expenses are covered by the national budget.
The European Union has set maximum residue levels (MRLs) for pesticides in and on food products. Products containing more pesticides than allowed will be withdrawn from the European market.
To avoid health and environmental damage, the European Union has set maximum residue levels (MRLs) for pesticides in and on food products. Products containing more pesticides than allowed will be withdrawn from the European market.
Note that buyers in several Member States such as the United Kingdom, Germany, The Netherlands and Austria, use MRLs which are stricter than the MRLs laid down in European legislation. Supermarket chains are the strictest and demand 33 to 70% of the legal MRL.
More and more buyers ask for upfront information about your pesticide spray programmes and records. Shipments are checked before it is sent to the retailer. Pesticide management takes a lot of responsibility from your part as a producer or exporter.Buyers ask for upfront information about the exporter pesticide spray programmes and records. Shipments are checked before it is sent to the retailer. Pesticide management takes a lot of responsibility from the producer or exporter side.
It is advised that the companies targeting access the EU market to be ready with the GlobalGAP certificate, this certificate apply the Integrated Post Management (IPM) to reduce the amount of pesticide. IPM is an agricultural pest control strategy, which is also part of a GlobalGAP certification. It uses natural control practices such as the application of pests’ natural enemies. The fewer chemicals you use, the better your marketing position will be for export to Europe. Also it is recommended to check with the buyers in EU is they have additional requirements on MRLs and pesticide use.
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Control of food imported to the EU
The European Union has restricted the use of certain chemicals (MRLs) to guarantee the food safety and avoid environmental damage. Therefore, any exported FFV products is subject to official controls. This is to make sure that all foods marketed in the European market are safe and in compliance with all applicable regulatory requirements.
The checks of FFV products handled through:
1- Documentation checks
2- Identity checks
3- Physical checks
In the case of the noncompliance of the same product from the same country for many times , the EU can apply an increased level of controls or apply the
emergency measures. Most of the checks are done at the point of entry; however, the EU can apply the check at any stage from the import to the marketing and sales of the products.
It is necessary for the importers of FFV products in EU to apply the EU tractability of products system to be able to withdraw or recall any FFV products that have been identified as unsafe. The importers will ask the exporters for the below preparation to be able to comply with the EU traceability:
Providing the proof of origin with a bill of lading (air or sea)
Phytosanitary certificate
Certificate of Origin
Packing list
Commercial Invoice
The complete set of customs documentations
Always ask for any updates or product specific requirements every year
Labelling and packaging
Tomatoes are packaged in open and closed fruit crates (tomato crates), tubs, cartons, trays and jointed boxes. Sometimes they are carefully arranged, sometimes randomly bulk-packed. Broken, damaged and damp packages must be rejected.
The principal law on food labeling remains Government (GOR) Decision 106/2002 which outlines the methodology and requirements for food labeling, accompanied by its Enforcement Rules. Decision 106/2002 was amended several times since its publication, as Romania has gone through the process of transposing EU Directives. In addition, the provisions of the EU Regulation 1169/2011 are applicable in Romania. The regulation entered into force on December 13, 2014, with the exception of the nutrition declaration which will apply from December 13, 2016.
All fruits that are subject to the EU marketing standards must be labeled with the nature of produce, he country of origin, standard/class, plus the variety if stated so in the standard. If sold pre-packaged, the following additional information has to be stated on the product label: name and address of packer, weight or number of items in the package, lot number, plus the size if stated so in the standard. We recommend contacting your importer about the details of labeling requirements prior to shipping.
As of December 13, 2014, additional labeling standards set forth in EU Regulation 1169/2011 are in effect in all EU Member States. The regulation mandates the declaration of nutrition and allergen information and sets forth minimum font sizes for pre-packaged and non-pre-packaged foods. For more information on how to comply with the new standards, please consult your importer and the following additional links:
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http://gain.fas.usda.gov/Recent%20GAIN%20Publications/NEW%20EU%20FOOD%20LABELIN
G%20RULES%20PUBLISHED_Brussels%20USEU_EU-27_1-12-2012.pdf
http://gain.fas.usda.gov/Recent%20GAIN%20Publications/How%20to%20Comply%20with%20th
e%20EU's%20New%20Food%20Labeling%20Rules_Brussels%20USEU_EU-28_12-2-2014.pdf
FFV products marketed in EU must meet the legislation on food labelling. Cartons of fresh fruit or vegetables must mention the following:
The name and the address of the packer or the dispatchers.
The name of the produce (if the produce is not visible from the outside of the packaging).
The country of origin.
The class and size (referring to the marketing standards).
Lot number for traceability or GG number if certified GlobalGAP (recommended).
Official control mark to replace name and address of the packer (optional).
For consumer and pre-packed fresh products you must add the name and the address of a seller established within the European Union with the mention ‘Packed for:’ or an equivalent mention.
Regarding the organic labeling, Ordinance 34/2000 provides information regarding the content of the organic product label. The label attached to organic products should include information regarding the name and the address of the producer/processor, the name of the product and the ecological production method, the name and the mark of the inspecting and certifying institution, the storage conditions, the minimum term of validity, the interdiction to store the ecological products along with conventional products.
In August 2014 Ordinance 34/2000 was amended by Government Ordinance 29/2014 which request all organic operators to observe the provisions of several more recent EU regulations, such as Regulation 834/2007 and Regulation 889/2008 concerning organic production and organic labelling. Order 29/2014 has not been amended since its enactment. Order 317 issued by Ministry of Agriculture in 2006 specifies the types of logos which may be attached to organic food on the product directly, on the label or on the package. The regulation applies to both domestic and imported products.
Plant Health
Fruit and vegetables exported to the European Union must comply with European legislation on plant health. The European Union has laid down phytosanitary requirements to prevent introduction and spread of organisms harmful to plants and plant products in Europe. These requirements are managed by the qualified food safety authorities in the importing and exporting countries.
Pesticide Sanitary and Phytosanitary Tests:
European Council Directive 2000/29/EC contains provisions concerning compulsory plant health checks for products entering the EU. The checks consist of documentary, identity, and physical plant health checks to verify compliance with EU import requirements. More information can be accessed on DG Health & Consumer Protection's website:
http://ec.europa.eu/food/plant/organisms/imports/inspection_en.htm.
Custom Clearance & Inspection
In order to be able to carry out foreign trade operations, ie to sell their products outside the European Union or, on the contrary, to buy products from third countries, economic operators must be registered in APIA's records. Only in this way will they be able to obtain the necessary export or import licenses. Registration is made at central APIA, not at its agencies in the territory. The following documents are required for sign-up: Application form in which the contact details (address, telephone, fax, e-mail address), the persons empowered to sign the applications, the submission and removal of the documents
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from the Agency, the bank coordinates; The products they are interested in will be listed for information. Copy of the identity document of the applicant / proxy. Copy of the registration certificate to the Trade Registry. Copy of the company's constitutive act from which it is possible to carry out foreign trade activities. Powers, if any. Registration may also be made at the first application for a license / certificate or in December of each Get the license An economic operator will need a license when importing or exporting agricultural products to or from a third country. Import licenses are required for monitoring by the European Commission of the volume of agricultural products imported or exported to or from the European Union. The Commission may control the issue of licenses and may suspend their issuance if the equilibrium of the Community market is jeopardized. When an operator applies for a license application, it may also constitute a security either in the form of a transfer deposit or a bank guarantee letter. The amount of the guarantee to be issued varies depending on the product sector. The guarantee will be returned to the economic operator when he provides the evidence that he has fulfilled his obligation to import or export. Export refunds Payment of the restitution is made on request, based on the evidence in the payment file, for economic operators who are entitled to restitution (see Articles 3, 4 and 5 of Regulation (EC) 800/1999). The rate of restitution is set by the European Commission or by auction, depending on the product and may vary from one country to another The refund can be paid: Standard, after completing the payment dossier; In advance, after acceptance of the customs export declaration at the customs office of departure and submission to the APIA of a 110% guarantee. No refunds are paid below 100 euros and no advance payment is made for exports to special destinations. Imported agricultural products may be subject to import duties. The tax is set according to the product sector and is collected by the National Customs Authority, which will be able to give additional information to the economic operators regarding the perceived customs duties.
Transportation Quality
Quality and suitability for transport are assessed on the basis of the following criteria. Tomatoes must be sound, clean, fresh, undamaged, free of foreign odors and flavors and free of abnormal moisture. Round, smooth varieties must be of uniform size and ripeness. They must be of a firm consistency and free from hard tops and unripe areas and have no empty seed chambers. Organoleptic testing: tomatoes exhibit a satisfactorily firm consistency if they are not deformed at all by cutting with a sharp knife at right angles to the placenta and the content of the seed chambers does not ooze out. Hard tops are present if finger pressure on the stem-end indicates hardening of the flesh of the fruit (pulp) over clearly defined areas generally green in color
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DISTRIBUTION CHANNEL More than half of the Romanian population (53 percent) lives in urban areas and the balance in rural areas. The level and sources of income differ between urban areas and rural areas. In 2014 average income per household in urban areas was 30 percent higher than in rural households. In 2014 the major source of income for urban households was salaries (63.6 percent), followed by social income (23 percent), and income translated from the consumption of own agricultural products (7.4 percent). Agricultural production is the major source of income for households from rural areas. In 2014 36.9 percent of income for rural households came from agricultural production (28.7 percent from the consumption of own agricultural products and 8.2 percent money income from agriculture). Salaries account for 30.3 percent from the total average income in rural areas followed by social income (25 percent). The monthly average income per person increased by 4 percent in 2014 to U.S. $ 280 compared to the previous year. Average income per household in 2015 has increased in nominal terms by 8 percent, the average income per household is U.S. $ 678/month. Expenditures represent 90.7 percent of total consumer income. In terms of expenditure distribution, the share allocated for food and beverages in 2014 was 43.4 percent (2 percentage points higher than in 2013), three times higher than the EU average. The share of expenditure allocated to alcoholic beverages slightly decreased from 7.8 percent in 2013 to 7.7 percent in 2014 while the share spent on hotels, restaurants and pubs slightly decreased from 1.5 percent in 2013 to 1.4 percent in 2014.
In Romania there are more than 1,700 modern retail stores which are structured in hypermarkets, supermarkets, cash&carry, discounters. One third of the total modern retail stores are in Bucharest; the following major cities by considering the number of modern retail stores are Ilfov, Brasov, Cluj, Timisoara. Modern retail continues to gain market share year by year, while traditional retailer numbers gradually decline. In 2012 modern trade and traditional trade has equal shares and starting 2012 modern trade share continued to grow.
In 2015, modern trade had 55 percent share compared to 45 percent share of traditional trade. This trend is expected to continue. The expansion of modern retail formats positively influence the food sector and contribute to its development. In 2015 retail food sales expanded by an impressive 19 percent due to the VAT rate cut, but the value of total food retail market remains at U.S.$ 21 billion, due to local currency depreciation. The share of modern retail at the national level in total retail is estimated to have reached 55 percent in 2015 (an additional one percent more as compared to the previous year), while traditional trade takes the balance.
Retailers focused their investments preponderantly into urban areas, but in the long-run rural areas may become more consistently the retail operators’ target. Retail sales for 2014 as compared to 2013 saw that total retail sales / turnover increased by 7.0 percent in 2014; non-food products sales increased by 10.6 percent, food products, beverages and tobacco sales increased by 7.5 percent. Retail sales for 2015 as compared to 2014 saw that total retail sales / turnover increased by 8.9 percent in 2015; non-food products sales increased by 2.8 percent, food products, beverages and tobacco sales increased by 19.1 percent.
In 2015 Romania registered the highest consumption growth rate since 2008 (9 percent), thus Romania being one of the most dynamic countries and one of the most attractive food and beverages markets in Europe. The latest salary increases plus VAT food reduction to 9 percent put money into consumers’ pockets, so modern retailers have many growth opportunities. The retail market continues to expand rapidly both in Bucharest and throughout the country. New stores are opening each month, industry plans for the following years include new openings of a few hundreds stores per year, and investments are also made in new logistics platforms in Northwest and Northeast Romania.
Hypermarkets, Supermarkets, Cash&Carry
The total retail market in Romania is estimated at approximately U.S. $ 21 billion, with modern retail value at U.S. $ 12-13 billion and approximately U.S. $ 9 billion belonging to traditional retail. Modern trade is dominated by 12 market players with a cumulated turnover of more than U.S. $ 12 billion (see Table 5). The large majority of retail stores are owned by foreign entities, belonging to German, French or Belgian entities.
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The list of leading top retailing in Romania
Retail Store Type Turnover Million USD
Kaufland Hypermarket 2013:1,857 2014:2,180 2015:2,388
Auchan Hypermarket 2013:569 2014:692 2015:1,126
Metro, Metro Punct Cash&Carry 2013:1,452 2014:1,422 2015:1,340
Carrefour All 2013:1,237 2014:1,289 2015:1,362
Selgros Cash&Carry 2013:988 2014:929 2015:846
Lidl Discounter 2013:600 2014:500 2015:1,100
Mega Image, Shop&Go Supermarket,
Proximity
2013:507 2014:703 2015:841
Penny Market, XXL Mega Discount
Discounter 2013:556 2014:659 2015:2,335
Real
Hypermarket 2013: 2014:23 2015:62
Cora
Hypermarket 2013:422 2014:492 2015:511
Profi, Profi City Supermarket,
Proximity
2013:333 2014:438 2015:551
Billa Supermarket 2013:365 2014:408 2015:421
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In Romania there are more than 1,700 stores included in hypermarkets, supermarkets, and cash&carry categories. For comparison, the number of outlets was 450 in 2008. From total trade, in 2014, hypermarkets account for 27 percent, supermarkets account for 14 percent, discounters for 9 percent and cash&carry for 4 percent.
Proximity stores had the highest growth rate in terms of number of new stores opened in 2015. Mega Image and Profi were the most aggressive retailers in terms of their stores network expansion in 2015, with 110 new stores and 115 new stores opened respectively. In 2016, according to retailers’ expansion plans, more than 200 new stores will be opened, which means that the number of stores will increase by 12 percent compared to 2015, when more than 1,700 stores were registered. More than half of the major players plan to expand in 2016. Profi plans to open 100 new stores, Mega Image plans 70 new stores, and Penny Market plans to open 20 new stores. Profi, the most aggressive retailer in 2015 in terms of number of new stores opened, received a loan with of 177 million RON (U.S. $ 45 million) from EBRD (European Bank for Reconstruction and Development) and Raiffeisen Bank and plans to open at least 100 new stores each year in the following 3 years. According to industry sources, retail is reaching its full potential for expansion, and mergers and acquisitions are expected to develop in this market.
According to industry sources, following the Billa acquisition by Carrefour in 2015, the next network to be bought is Cora, having as potential buyers Carrefour and / or Auchan. The retail mergers and acquisitions market will be more closely monitored by the Competition Council as there is a risk of market concentration as according to 2014 turnover, the first 5 players have approximately 60 percent of the market.
In 2014-2015 retailers continued their expansion in terms of number of new stores. Their projects included adding new “concept-corner” formats in their portfolio. One of these is Wine Gallery from Mega Image, which is a shop-in-shop for wines, with a range of 900 wine brands and a dedicated cashier. Another one from the same retailer is Equilibrium Health and Wellness, where about 10 product categories are ready for sale: organic products, spices, seeds and germs, raw-vegan, sport nutrition, food supplements, vitamins, natural cosmetics, spa items, organic cleaning items. Online commerce is another move made by Mega Image in a partnership with the largest on-line retailer (eMag), offering about 7,500 products, with national coverage. Retailers have also started to make investments in the rural area. Mid-year 2015, Profi announced a new retail concept for rural areas, Profi Loco, with approximately 2,500 SKUs per store. Profi is the first retailer to enter the rural area with its own network store, while Metro, Carrefour and Mega Image are also keeping an eye on rural areas but they apply a more cautious strategy: collaboration with local entrepreneurs that already own stores in the respective areas.
Distribution channels / Entry Strategy
Importers and distributors are direct suppliers for retailer stores and are familiar with existing legislation, trading practices and customers. Most importers/distributors have distribution channels with national coverage. One strategy for entering the market is to work directly with them. Small stores purchase food mostly from wholesalers/Cash&Carries. As the major part of retail structure still consists of these small food stores, it is important that exported products reach these wholesalers. Another strategy approach is to find an exclusive local representative. In this case, the representative would be totally devoted to one company’s segment of products and be responsible for all promotional activities (advertising, sampling). During the process of searching/negotiating for a local distributor, the Egyptian exporter has to carefully study the existing portfolio of the potential distributor and make sure they will dedicate efforts to product promotion and development. Given the expansion of modern retail, some supermarkets and hypermarkets started to develop their own logistical centers.
Importers/ distributers
100%
Proximity stores
628 stores
36%
Supermarkets
409 stores
24%
Discounters
377 stores
22%
Hypermarkets
185 stores
11%
specialized stores
81 stores
5%
Cash& carry
54 stores
3%
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However, even as small kiosks and traditional stores decline in numbers, distributors will still play an important role in the retail market. In the medium and long run, market concentration and consolidation is expected among distributors, as some of the companies might not have enough resources to fulfill the increasingly complex needs of retailers. Modern retailers have an increasing interest to find local suppliers, especially in the area of fresh fruits and vegetables. There is an increasing trend in emphasizing at a visual level the origin of the product is Romania. However, these initiatives are short-term in many cases, as local producers’ ability to fulfil retailers’ requirements in terms of volumes and consistent quality are limited, and they apply seasonally (summer/autumn).
Direct contact with local food service importers is the recommended entry strategy for Egyptian exporters. In general, food service sector do not import food directly as for them it is easier to order the products they need from food service companies that specialize in providing high quality fresh products. Restaurants such as quick service chains or family style restaurants also order and purchase imported food from food service companies or from their affiliates who act as their distributors. Five-star hotels and resorts are highly recommended for high quality committed Egyptian exporters.
47
SUPPLYING MARKETS AND COMPETITION
There are many suppliers of tomatoes to the Romanian market, but the Turkish supply can cover the whole tear demand through its different product varieties they can produce in different seasons. Supply from Egypt will face strong competition challenges from Turkey products, Albania and even Spain. The price, product quality, shipping time and supply sustainability are the key elements to focus on to be able to compete with the key suppliers to the market specially Turkey.
Turkey is the major supplier to the market with a yearly growing supply and market share in Romanian market. The supply from Turkey reach 49.1% of total imported tomatoes (37,588 tons), the second top supplier is Spain with less than one fifth of Turkey supply to the market, Spain acquires only 8.8% of market with a diminishing growth rate by -34% in 2017.
The supply from Albania is a fast growing supply, the share of Albania in the market jumped from 0.8% in 2013 to reach 8.3%in 2017.
Despite Egypt can introduce the product is a very distinguishing period of the year, but there is no any direct supply for tomatoes to Romania from Egypt. The good price ranges of the Egyptian product may allow the exporters to access the Romanian market that mainly focuses on having better prices with keeping the quality level the same; but the major challenges are guaranteeing the quality and well handling the logistics and shipping.
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Egypt
Romania
Turkey
Spain
Albania
Germany
Netherlands
Poland
Italy
harvesting schedule of tomatoes in the main supplying countries
Major supplying markets of tomatoes imported be Romania/ year 2017
Positive
growth
Market
share8.3% -48.5% 7.1% -3%
Poland6,324 Tons 5,397 Tons 3,049 Tons
4.0%
8.4% 14.5% 8.3% 20%
Italy Netherlands
20.7%
Negative
growth
Albania GermanyTurkey
49.1% 30.1%
Spain
8.8% -34%
37,588 Tons 6,695 Tons 6,426 Tons 6,357 Tons
48
PRICING Romania is one of the key producers of tomatoes in Europe despite the production is diminishing yearly over the last five years. The production price ”farm price” of tomatoes in Romania according to the FAO
statistics reached 758.4USD/toms in 2017 on average, this average price achieved 5.1% growth from 2016 farm prices levels, and 6% growth from the 2012 farm prices levels.
Romania is not a significant exporter of tomatoes, majority of its production that come in the season that start from June until October sold in the local market. The average export prices of tomatoes reached 857.6 USD/ tons in 2017 according to Comtrade unit value statistics. The export prices in FOB terms is higher than the farm price by 14.7% that can be considered as the contribution margin for the traders of exporting tomatoes from Romania.
The average unit value import price for tomatoes in CIF terms reached 991.0USD/ tons. The prices grew compared to last year by 3.9%. the average import unit value price this year is less than the import prices range in 2012 by -24.0%.
The CIF import Prices is higher than the farm price in Romania by 32.5% on average, and higher than the FOB export price from Romania by 15.6%.
the wholesale prices of 20th of June recorded 1.1USD/kg, this is the lowest price since the start of 2018 because of the start of harvesting season in Romania. It is the early production stage in Romania now. This price dropped by -33% from the last week prices, and dropped by -48% from the last month prices. Compared with the same period of the last year, the prices dropped by -40.7%.
The average wholesale price is higher than the average farm price by 47%, that represents sorting, packaging, transporting to the retail and the wholesalers markups. On the other hand, the wholesale price in the production season in Romania is higher than the CIF import price by 11%, which is not attractive for the importers and wholesalers to import big quantities of tomatoes.
49
During the off-season period where the prices can reach its peak and highest level during the period from early of March until end of April, the average wholesale price can reach 2.8 USD/kg; the wholesale price can be higher than the CIF import price by on average 90%. This is a very attractive mark-up for the importers to import tomatoes. It is recommended for the Egyptian companies to focus its business development activities to export tomatoes for the Romanian market during the off-season months between February and May.
EU is applying significantly high duties on imported tomatoes from non-EU countries; for each 100kg of imported
tomatoes from Egypt, a value of 1.1EUR to 29.80EUR per each 100kg will be added to the price in the Performa
invoice, and the values are varied and subject to the price levels in the Performa invoice. The same duties is
applied on Turkey.
50
Different duties are applied for Morocco, an applied tariff of 4.8% is added to above mentioned price value rates.
For Albania and all Balkan region countries, they can access the EU market without any applied duties; the
applied duties is (0%+0”).
51
MARKET REQUIRMENTS & CERTIFICATES The EU requires import licenses (AGRIM certificates) for most agricultural products for which it provides market support, including grains, milk, meat, olive oil, most fruits and vegetables, wine and sugar. In order to obtain a license, an application form must be submitted and security fee must be paid to the issuing Member State. Licenses vary in validity with most expiring three months after the month of issuance. The license is applied for by the importer.
In addition to the mentioned requirements in the “conformity to export” section; another set of requirements the buyers may impose but it is not a mandatory requirements by EU commission to access the market; it is only request by the buyers to distinguish their products and create competitive edge for their products, these requirements including the following:
As food safety is a top priority in all European food sectors, you can expect most buyers to request extra guarantees from you in the form of a certification. Many buyers (for example traders, food processors, and retailers) require the implementation of a food safety management system based on Hazard Analysis and Critical Control Point (HACCP).
The most commonly requested food safety certification scheme, essential for exporting fresh produce to Europe, is GLOBALG.A.P. This is a pre-farm-gate standard that covers the whole agricultural production process, from before the plant is in the ground to the non-processed product (processing not covered).
Almost all buyers on the North-Western European market will require you to comply with the British Retail Consortium (BRC) global standards, which are widely applied as a standard for hygiene and safety. On the European mainland, buyers sometimes require from the exporter to comply with the IFS food standard, Safe Quality Food (SQF) programme, FSSC22000 or other industry-developed standards.`
It is crucial to determine the required certifications both for the fields as well as the packing stations.
In addition to the official and common requirements, specific requirements apply to niche markets and many buyers are asking for it to distinguish themselves in the market and in front of retailers and end customers. These requirements such as organic or fair-trade fruit and vegetables. Below the major niche market requirements:
Social and environmental compliance
There is growing attention for the social and environmental conditions in the producing areas. Most European buyers have a code of conduct which they will expect you to adhere to. For most fresh fruit and vegetables social compliance is important, although product quality is top priority.
Initiatives and attention relating to Corporate Social Responsibility (CSR) vary across the various parts of Europe. In the Eastern part of Europe, fewer buyers require social compliance, while in Western Europe some multinationals even have their own codes of conduct. Examples include Unilever’s Sustainable Agriculture Code and Tesco’s nurture accreditation.
Buyer initiatives which have an impact on you as a supplier in terms of social compliance include:
The Ethical Trading Initiative (ETI) in the UK
The Business Social Compliance Initiative (BSCI) in North-Western Europe.
The Global Social Compliance Programme (GSCP), which provides reference and self-assessment tools
The IDH Sustainable Trade Initiative has a Fresh & Ingredients program with the aim to increase imports of sustainably produced crops with 25% by 2020 (against the 2016 baseline).
Sedex, a non-profit membership organization to evaluate and manage your performance around labour rights, health & safety, the environment and business ethics.
52
Examples of social or sustainable labels for fresh fruit and vegetables are:
GRASP
Fair for Life
Fairtrade Rainforest Alliance / UTZ (as part of the Sustainable Agriculture Network)
Fair Trade labels are not on the top of the list of buyers because of the complex requirements and high costs. GRASP, which is part of GlobalGap, is more accessible and gaining in importance.
Organic, a growing niche market
Along with the EU organic mark, Romania has its market for organic products. It can be used alone or with the EU mark as an evidence for organic.
The national logo “ae” and the EU logo for organic products may be used on the labels of organic products. All the producers, processors and importers have the right to use the national logo “ae” on products, labels and packaging after being registered at the Ministry of Agriculture. Importers are free to use the EU logo for organic agriculture specifying the origin of the ingredients (EU or non-EU). Organic products bearing the national logo or the EU logo must meet the following conditions: 95 percent of the ingredients are produced through organic agriculture and the products are obtained according to organic agriculture. Organic products labels must indicate the names of the producer/processor/trader and the name
or code number of the inspection body which oversees and issues the certificate for that organic operator. Additional information about organic farming and utilization of logos is available here.
The Romanian organic sector is highly export-oriented. In the last three years, conversion subsidies have made organic farming more attractive, leading to strong growth in the certified area.
There is little consumer awareness regarding organic quality among Romanians, who are rarely willing to pay a premium for certified organic products. Control organisations report that neither food processors nor consumers ask for certified products, even if they buy and use organic produce. There is a wide-spread assumption that home-grown products are in fact organic products.
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POTENTIAL LEADS # Company Address Website Tel
1 SC WOW FRESH SRL
100 arad Park industrial
nr 2,Arad
ROMANIA
+40 757 38 81 50
2
BRIMEX DISTRIBUTION
7000 Bucharest Grigore
Ionescu nr69,bl.T25,
apt.2, sector 2
ROMANIA
+40 771 20 54 11
3 I.I. BALUTA N STEFAN
235400 Draganesti-Olt
stadionului nr.5a
ROMANIA
+40 764 82 14 70
4
OCEAN SPA SRL
061316 Bucharest
Constantin Marinescu nr
17 D
ROMANIA
+40 755 25 90 70
5 MADREROM
505200 Fagaras
Fagaras/Brasov/Romania
ROMANIA
+40 269 52 17 23
6 POL ROM TOTAL
410491 Oradea Str. P-ta
Nucetului nr. 20
ROMANIA
http://polromtotal.wordpress.com/ +40 724 44 04 12
7
DYNOMIKE SRL
021805 Bucharesti
strada fantanica nr 36
ROMANIA
http://www.dynomike.ro/ +40 733 99 99 97
8
ROM-FUNGHI SRL
Pocola, str. Principala,
nr.36, jud. Bihor
417375 POCOLA Arad,
str. Dragalina, nr. 18
ROMANIA
http://www.romfunghi.com/ +40 259 32 14 17
9 BINATURIO 900 Ovidiu Ovidiu
ROMANIA http://www.binaturio.com/ +40 763 65 86 20
54
10
S.C. MICROFRUITS SRL
077010 Branesti Soseaua
Garii, nr 16 Ilfov
ROMANIA
http://microfruits.ro/ +40 757 04 02 10
11 SC ROMALDO SRL
300524 Timisoara Str.
Wilhelm Tell, Nr. 29
ROMANIA
http://www.romaldo.ro/ +40 256 24 49 18
12
SC ESILA GOLD SRL
300368 Timisoara strada
Crisan nr.47
ROMANIA
VAT No. RO 31029120
+40 751 81 81 61
13
PROFSTART FRUIT SRL
807185 Matca MATCA
ROAD
ROMANIA
+40 733 23 92 33
14
SC ALIRO-BIOFUNGHI SRL
415200 BEIUS
STR.PANDURILOR 55A
ROMANIA
+40 760 69 45 91
15 LIDL ROMANIA SRL Chiajna +40 214071320
16 MONDO TRADE SRL Targu Mures +40 265253444
17 T.A.R. TRADING DIVISION SRL Constanta +40 241485048
18 ATACRET SRL ORADEA +40 259 463988
19 UNISEM SA BUCURESTI, SECTOR 4 http://www.unisemb.ro/ +40 2106839
55
REFERENCES http://www.balkaninsight.com/en/article/romania-s-looming-political-crisis-threatens-its-
budding-economy-06-16-2017-2
http://www.countrywatch.com/Content/pdfs/reviews/B43L8M36.01c.pdf
https://www.theglobaleconomy.com/rankings/wb_political_stability/
https://worldview.stratfor.com/article/romanias-corruption-scandal-threatens-political-stability
https://www.heritage.org/index/country/Romania
https://www.nordeatrade.com/en/explore-new-market/romania/political-context
https://www2.deloitte.com/content/dam/Deloitte/cn/Documents/international-business-
support/deloitte-cn-ibs-romania-int-tax-en-2017.pdf
https://home.kpmg.com/xx/en/home/insights/2017/11/tnf-romania-corporate-individual-tax-
changes-effective-beginning-2018tnf-romania-corporate-individual-tax-changes-effective-
beginning-2018tnf-romania-corporate-individual-tax-changes-effective-beginning-2018.html
https://home.kpmg.com/ro/en/home/insights/2017/06/romania-tax-guide.html
https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Tax/dttl-tax-
romaniahighlights-2018.pdf
http://taxsummaries.pwc.com/ID/Romania-Corporate-Taxes-on-corporate-income
https://accace.com/labour-law-and-employment-in-romania/
https://accace.com/wp-content/uploads/2017/01/2017-Labour-Law-and-Employment-Romania-
EN.pdf
https://www.lexology.com/library/detail.aspx?g=6926e878-c0cd-459d-9771-2b913acb676b
http://www.ilo.org/dyn/travail/docs/1630/
https://www.theglobaleconomy.com/rankings/wb_corruption/
https://www.business-anti-corruption.com/country-profiles/romania
https://www.theguardian.com/world/2018/jan/21/tens-of-thousands-protest-against-corruption-
in-romania
https://www.theglobaleconomy.com/rankings/trade_openness/
https://www.export.gov/article?id=Romania-Customs-Regulations
https://www.export.gov/article?id=Romania-Import-Tariffs
http://madb.europa.eu/madb/euTariffs.htm?productCode=0702000099&country=EG
https://www.ceicdata.com/en/indicator/germany/annual-household-income-per-capita
https://tradingeconomics.com/country-list/disposable-personal-income?continent=europe
http://www.oecdbetterlifeindex.org/countries/germany/
https://tradingeconomics.com/romania/money-supply-m0
https://tradingeconomics.com/romania/money-supply-m2
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https://tradingeconomics.com/romania/money-supply-m1
https://www.theglobaleconomy.com/rankings/Bank_credit_to_the_private_sector/
https://www.trademap.org/CompaniesList.aspx?nvpm=1|642||||070200|||6|1|1|1|3|3|2|1|1
https://www.unece.org/tradewelcome/trade-programme.html
http://trade.ec.europa.eu/tradehelp/sanitary-and-phytosanitary-requirements
http://ec.europa.eu/food/plant/pesticides/eu-pesticides-
database/public/?event=product.resultat&language=EN&selectedID=117
http://madb.europa.eu/madb/euTariffs.htm?productCode=0702000099&country=AL
https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Exporter%20Guide_Bucharest_Ro
mania_5-13-2016.pdf
https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Food%20and%20Agricultural%20I
mport%20Regulations%20and%20Standards%20-%20Narrative_Bucharest_Romania_12-28-
2015.pdf
https://ec.europa.eu/agriculture/organic/downloads/logo_en
https://www.europages.co.uk/GRADINILE-VECHI-THE-OLD-GARDENS/00000004538008-
336033001.html
https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Organic%20production%20and%2
0market%20overview_Bucharest_Romania_2-16-2017.pdf
http://managementjournal.usamv.ro/pdf/vol.17_2/Art47.pdf
http://managementjournal.usamv.ro/index.php/scientific-papers/323-tomatoes-balance-sheet-
in-romania
https://www.trademap.org/CompaniesList.aspx?nvpm=1|642||||070200|||6|1|1|1|3|3|2|1|1
57
APPENDIX: OVERVIEW GLOBAL TOMATOES MARKET
The mood on the European market is bleak. Traders in the Netherlands and Belgium are pessimistic about
the pricing situation, although this is also not uncommon for the first weeks of a New Year. According to a
Belgian trader, there is simply too much supply because all countries have had a good harvest, even
though Spanish growers in Almeria have been dealing with various diseases. Italian growers are pleased
with the start of the season. The mood is also positive in Morocco. In the US, the demand is limited due to
the winter conditions, but the market is in balance. South African traders are looking forward to the end of
the holiday season. The market is a "nightmare."
Tomatoes are in the ranking of the most consumed vegetables worldwide. 177 million tonnes of tomatoes
were grown globally in 2016. This meant that production was almost 30% higher than ten years earlier.
Approximately 5 million hectares of tomatoes have been planted all over the Earth. On average, 3.7 kilos
per square metre are harvested from that acreage. The largest producers are China and India, although
the yield in India is low and stands below 2.5 kg per square metre. This contrasts sharply with the yields
that growers achieve in the US (9.03 kg/m2), Spain (8.62 kg/m2) and Morocco (8.08 kg/m2). The Dutch
yield stands head and shoulders above the rest of the world, with an average of 50.7 kg/m2.
Morocco: tomato exports increased thanks to government support
In the past decades, the tomato sector has grown enormously thanks to the modernization of the
techniques and materials used. Tomatoes are one of the most important crops in Morocco. The acreage
stands at 18,642 hectares, with a production of more than 1.2 million tonnes in 2016. This means that the
sector generates thousands of jobs in the North African country, and thanks to the product's export, tomato
58
cultivation is an important pillar of the economy.
The tomato sector is divided into three parts. The early greenhouse production is mainly concentrated in
the Souss-Massa and Doukkala-Abda regions. These tomatoes are widely exported to the EU, Russia and
Canada. The early open-ground tomatoes from the regions of Moulouya, Temara-Skhirat and Casablanca
mainly find their way to the domestic market. The acreage of the early tomatoes has expanded by between
14% and 20% in the past ten years (since the start of the Maroc Vert Plan). The yield, however, has
remained stable.
The seasonal production is much smaller and the crops are mostly located in the coastal regions. Sales
are mainly focused on the domestic market. Production has remained stable since the 2008-2009
campaign. Tomatoes are also grown for industrial processing. These crops can be found in the regions of
Mèknes, Marrakech and Beni Mellal. Although the acreage has fallen sharply in recent years, from 4,503
hectares down to just 420 hectares, the yield has improved considerably.
Since the Plan Maroc Vert was announced, exports have increased by 56%. In a decade, exports have
grown from 344,000 tonnes to 537,000 tonnes. Turnover in the Moroccan currency has increased by
139%, from 2.03 billion dirhams to 4.8 billion dirhams.
Turkey is considering opening its borders
The rising prices in Turkey could lead to the country opening up its borders to imports. The government
said last month that this option was on the table. In previous years, tomatoes have been imported from
Turkish Cyprus, Romania and Ukraine. Following the boycott, Russia reopened the door. This year, Turkey
will be able to export 50,000 tonnes to what was once its most important export destination. In 2016, the
Turkish production stood at 12.6 million tonnes. Turkish consumers are not only concerned about prices,
but also about quality. Due to the strict requirements that Russia sets, only the premium tomatoes can be
shipped to that market. Due to the lack of a good control system for the domestic market, poor quality
tomatoes can easily be sold on the Turkish market.
EU: Decreasing acreage, higher yield
Despite the investments made to extend the season, the EU expects tomato production to remain stable.
Thanks to segmentation, the value of the production is actually increasing. The EU produced around 18
million tonnes of tomatoes in the 2016/2017 campaign, 40% of which were sold on the fresh market. The
remaining volume is processed by the industry. Together, Spain, Italy, the Netherlands, Poland and France
account for 75% of the tomato production for fresh consumption. This distribution is different for the
processing industry, with the Spanish, Italian and Portuguese productions being the most predominant.
These countries supply 94% of the tomatoes for processing.
The production volume has not shown any real growth figures in recent years; in fact, an estimate reveals
59
that the EU expects a 1.4% drop by 2030, although more money is being made in tomato cultivation.
Thanks to the introduction of new varieties, especially in the snack and cocktail segment, the product's
value in the chain has improved. In fact, it has grown by nearly 20% in France, Germany, Italy and Spain in
the period from 2006 to 2016. And although the acreage is under pressure, the yield is improving thanks to
the investments made to extend the season. The traditional summer campaign in the northern countries is
being extended until the winter months, and the traditional winter season in the southern countries
continues into the summer months.
On average, Europeans consume 15 kilos of tomatoes per year. That figure has not changed in recent
years, but will be under pressure in the coming years. According to the estimates, consumption in 2030 will
amount to 14.4 kilos per year per capita.
The Netherlands: unstable market
In the Netherlands, the year started with the aftermath of Christmas, which was fine in itself, but prices fell
immediately after the start of the year, and that decline has continued, so the prices are not good at the
moment. The Dutch hail damage and the Spanish tornado have had little effect on this.
The tomato market in the Netherlands is currently very unstable. According to importers, suppliers want
more money than the market allows at the moment. The price of Moroccan tomatoes has dropped in
recent days and a further decline is expected. The demand for tomatoes is moderate, but that is not
uncommon for the first weeks of the year. The prospect is for more kilos to arrive from Spain in the short
term. As a result, the pressure on the plum tomato market will only increase. The market is also difficult for
Spanish on the vine tomatoes due to the expanding acreage of lit on the vine tomatoes in the Netherlands
and Belgium.
Belgium: low prices
According to a Belgian trader, there are "still a lot" of on the vine tomatoes on the market. Due to the mild
winter weather, harvests are good everywhere in Europe and most countries have plenty of tomatoes from
their own production. As a result, there is little demand for the Belgian products. Because of this, the on the
vine tomatoes are far too cheap for the time of the year, with prices oscillating between € 1.15 and € 1.20
per kilo.
France
The country currently has little domestic production. The season usually runs from March to November.
Imports are usually made in the other months.
Germany welcomes transition to Spanish season
The supply from Spain, Turkey and Morocco is slowly but surely dominating the German market. In
contrast, Dutch imports are slowly declining. Due to the warm weather, the Dutch production is indeed
60
great, but the quality decreases as the season develops, according to the German traders. Traders confirm
that the prices of Spanish on the vine tomatoes are still a few percent below Dutch prices. The same
applies to the cherry tomatoes. Furthermore, Spanish prices are also slightly lower compared to last year.
According to the traders, however, these prices are still about above-average. This is due to the relatively
cold period recorded last month in important growing areas, such as Murcia and Almeria. It is worth
mentioning that the quality of Spanish tomatoes was very high last year.
In both Germany and Switzerland, retailers are still reluctant to sell loose tomatoes. Although trials have
been carried out with the so-called Pick and Mix principle (mixing snack tomatoes themselves), which were
especially well received in the big cities, the turnover is mainly determined by packaged items. Also, the
amount of discards is also quite high, because the tomatoes are unprotected on the shelves.
UK: Largest tomato grower expands
The largest British tomato grower has announced an expansion. The company is investing in a new
greenhouse on the Isle of Wight, where more room will also be reserved for organic cultivation.
Polish tomato market likes pink
The Polish consumer has a preference for regional products. Thanks to the advent of modern techniques
and artificial light cultivation, this is now possible in Poland. Growers are committed to expanding the
acreage. In addition to producing for the domestic market, Polish growers are looking to the west, where
the German market beckons. However, it will take a month or two before the Polish season really kicks off.
Until then, traders have been relying on imports from Spain, Turkey and Morocco to fill the gaps in the
market. "The market is unstable at the moment, but that is often the case in January," explains a trader.
With the problems in Spain, the market will not improve in the short term.
Traditionally, Polish consumers have cared about sizes and prices. Large tomatoes sold for low prices
have usually enjoyed great popularity, but in recent years, the demand for specialties has also increased
and taste is becoming more important. Pink tomatoes are doing especially well in the Polish market. A
grower affirms that this year they expect to produce 25% more of this variety. The Polish consumer has
more to spend thanks to economic growth, which explains this shift.
Sicily starts season with optimistic prospects
The Sicilian season had a good start in November, with the prices for the red varieties, such as the cherry,
datterino and piccadilly, being particularly good. The start of the season after the planting in September
was delayed by 20 days. As a result, the season started with an empty market, which was reflected in
good prices. The performance of green tomatoes, such as the costolute, is not as good. The supply from
the island will peak next month, after which the season will continue with declining volumes until June.
A trader says that the competition from North Africa has not been strong this year, as these countries are
61
facing their own problems. The Dutch season ends in November. The Spanish production is a "sword of
Damocles, but we are used to that."
The prices in November and December oscillated between 1.80 and 2.20 Euro per kilo for the cherry
tomatoes; the datterino reached a record 2.00-2.50 Euro per kilo and a peak of 3 Euro. The piccadilly
stood at 1.20 to 1.80 Euro per kg. According to a grower, the supermarkets prefer the local produce and, in
general, the demand for specialties is on the rise. Internationally, Sicilian growers have devised a new
approach that is particularly successful in Germany.
China: rising production makes prices fall
In 2017, prices in Shandong, the largest tomato-growing region in the country, were low. Prices fell due to
increasing production and a limited supply of transport options. These transport restrictions are the result
of stricter environmental requirements in the province. Moreover, the average temperature was higher in
the whole country, which meant that production everywhere was greater.
Spain: Disease pressure high in Almeria
The growers in Almeria have suffered the impact of a lot of diseases this year, especially the whitefly
and Tuta absoluta. According to some traders, this is the result of an ever faster growth of the organic
acreage and climate change.
The growers with a small acreage (2-3 hectares), who account for about 80% of the sector in Almeria,
decided to plant the tomatoes late to reduce disease pressure. Furthermore, it was colder than usual in
October and November, which resulted in a late start of the season. "The few growers who were able to
supply between September and November received good prices, but everything changed around
Christmas, when the temperature rose to unusual levels, causing the production volume to peak," says a
trader. Due to the reduction of the acreage, the situation will change again in the coming weeks. Growers
are choosing to cultivate peppers rather than tomatoes. Also, Spanish exporters benefit from the gap left
on the European market by the fact that Turkey and Morocco are focusing more on exporting to Russia. "It
will be a good tomato year in terms of price," predicts a trader. The growers are planting more plum
tomatoes with a high yield, long shelf life and a good taste.
US: Good supply and stable market
According to a trader, the supply is currently plentiful. There is domestic production available from Florida
and Texas, as well as imports from Mexico. The demand is stable. "The supply and the demand are in
balance in most cases. People don't go for salads with the cold and snow at this time of year," says a
trader. The prices are under pressure because the supply from Mexico is arriving at a good pace. The
Florida season was slightly delayed by the hurricanes in the autumn of 2017. Logistics costs are
considerable for the traders. The rates for trucks usually rises in the run-up to Christmas, but unlike
previous years, the tariffs have not really dropped afterwards.
62
South African market "a nightmare"
The market is currently difficult, according to a trader. Due to the holiday season, the demand has fallen,
although it is expected to pick up again with the end of the school holidays. The weather conditions have
been ideal for growing, with not too much rain and a high temperature, which means there is some
oversupply in the market. Last week was referred to as "a nightmare". The price for a 6 kilo box dropped as
low as R10-R15 (0.60-1 Euro). Now it has gone up a little, but the huge supply has kept all prices under
pressure anyway. Ripe tomatoes now yield 1 to 1.30 Euro and the greener tomatoes go for 1.30 to 2 Euro
per 6 kilos.
Nigeria is the largest tomato grower in Africa
With a production of 2.4 million tonnes per year, Nigeria may well be the largest tomato producer south of
the Sahara. The West African country ranks thirteenth on a global scale. However, the sector faces great
challenges in distribution, storage and cultivation.
Russia continues to build
In Russia, the cultivation of greenhouse vegetables is growing steadily, especially that of tomatoes. In the
past year, 150 hectares of high-tech horticultural greenhouses have already been launched and a similar
figure is expected for the coming year. The Russian company Agrokultura has started expanding with a 27
hectare greenhouse that will be used for the propagation of young plants and the cultivation of cucumbers
and tomatoes.
Central Asia is a growth market for greenhouse builders
Although horticulture in these countries is still in its infancy and there is ample room for improvement, there
is plenty of investment in new greenhouse complexes. Greenhouse builders are developing various
projects in, among other countries, Georgia and Kazakhstan. The greenhouses are mainly used to grow
tomatoes and cucumbers.