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Analysing ICT Usage of Hungarian Milk Producers and Milk Processors
37-49Views:96Milk production and processing is one of the main agrofood sectors in Hungary. In 2016, the number of enterprises operating in milk production and milk processing sector was 741 and 80, respectively. Advanced information systems enable us to attain more and thorough data on their operation and performance and the analysis of these data is crucial for the evaluation of their situation in the sector. These data sets are important for monitoring and assessing the performance of different sectors. Hungarian Central Statistical Office provides multidimensional databases, while financial and additional information of more than half of the operating enterprises are available in EMIS database. As a complementary database, Institute of Applied Informatics and Logistics has prepared a questionnaire for survey the ICT (Information and Communication Technologies) usage characteristics of enterprises operating in the agro-food supply chain (producers and processors). The survey was conducted in the fourth quarter of 2017 and using structured questionnaire and responses are recorded by a market research company contacting the leaders or a management member of the enterprises. The sample has been selected by stratified sampling based on statistics of Hungarian Central Statistical Office (HCSO). Enterprise size based on staff employed and region at NUTS-2 level were the basis of sampling. Data set contains data about 500 enterprises operating in sectors related to agriculture and food industry (355 are operating in the production part, 145 in the processing part of the chain). 38 enterprises operating in the milk sector from the whole sample (28 belong to milk production and 10 to milk processing sector). The main objective of current article is to determine the difference between food producers and food processors, and separately between milk producers and milk processors regarding their evaluation of ICT devices in their partnerships an the internet-based solutions for certain business activities. Respondents assessed the importance of ICT on 5-point Likert scale relating to four business activities (communication; data storage and exchange, preparing documents; logistics; marketing). To determine the difference, two-sample t-test has been applied. Our results show significant difference only in the case of bulk sample, between food producers and food processors, in the evaluation of ICT devices for marketing purposes. The mean of scores given by food processors was significantly higher (Sig. (2-tailed)=0,0134 and t-value=-2,4829). There is no siginificant difference between milk producers and milk processors, however, the means of scores given by the latter for the importance of ICT tools were higher in the case of each four business activites.
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Examination of Sustainable Consumer Behaviour in the Market of Milk and Milk Subtitutes
3-17Views:560The purpose of this study was to discover the impact of the transitioning consumer habits on the dairy industry’s situation and products. The dairy sector faces more and more challenges, such as sustainability concerns and the appearance of substance alternatives. Milk, as a product, is considered a fundamental component of our nutrition; therefore, the industry needs to keep up with consumer preferences. In connection with the plant-based drinks and milk alternatives (clean milk, laboratory milk, egg-based milk replacements) that are getting more and more popular, the question may arise: to what extent can milk-based products be replaced? Is there a product which, from all aspects, is a perfect alternative to milk? In order to answer these questions, we studied the current market position of milk, and the relevant challenges of the industry, mainly from the aspect of sustainability. Then we examined the characteristics and consumer perception of the plant-based drinks that are aimed to replace it. Finally, we took a look at the possible market situation of another replacement product, clean milk, which is expected to be released soon. The results called our attention to that the milk industry is probably awaiting transformation where new technological solutions, such as the spread of more ethical animal husbandry, are set to become the main direction. Such product will also represent a higher value for consumers, which will impact the price of these products. Although plant-based drinks’ market share shows dynamic growth, currently, there is no product available that can perfectly replace milk from all points of view. However, it is essential to note that milk replacements produced by various innovative technologies will expectably appear on the market as new competitors.
JEL Codes: Q13, O13, O33, A13 -
Online Marketing Possibilities of the Domestic Dairy Sector
55-65Views:138The online appearance of the local milk processing micro-, small and medium-sized enterprises is rather bare (e.g.: official website, social media site), so they are not really able to maintain the online information collecting and shopping demands of the Hungarian digital food-consumers. Without this active participation, consumers cannot be involved in the company processes, in spite of the fact that food related search for information and the eventual shopping are key elements in the willingness to turn consumers’ lifestyle towards a healthier way. We used primary and secondary marketing research methods. During the secondary data and information collection, we collected and arranged already available data. During our primary data collection we carried out a quantitative research which was based on the analysis of our secondary data collection. We made our company observation project, where we analysed the online appearance of the members in the local milk industry with the help of an observation sheet, based on the database of NÉBIH (National Food Chain Safety Office). The members of the dairy industry (88 companies) were filtered for factory types and processed species. Fifty-nine per cent of the milk processors provide a personal online platform for the users. A third of the related milk processors have Facebook account. In the examined sector, every second company refreshes its timeline, or adds new entries less often than monthly, which is an extremely low tendency. Based on the results, we can say that these processing companies have exclusively Facebook accounts within the different types of social media, and they are quite passive. With the previous observation, we took into consideration the methods and tools given to the examined companies in order to judge the involvement of the consumers in the company processes. The rate of this involvement was observed on a Likert 1 to 5 scale and the obtained results were disappointing and regrettable. The value was 1.93 in the case of milk processors with a website and/or Facebook account. The results strengthen our assumption that the local companies in the related sector are not eager at all, or only at a minimum rate to involve consumers in the company processes.
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The Situation of Dairy Industry
3-21Views:79The increasing household incomes change the volume and the structure of the human consumption. There is a strong correlation between the changes in diet and the rapid urbanisation. Moving to the urban area often coincedes with a higher level of lifestyle which in turn can decrease the share of the agriculture labor force. Nowadays, more than half of the population lives in urban areas, but this share can be 70% until 2050 (FAO, 2011). Milk and dairy products are major items in the changing consumption structure. The consumers with mostly starch based diets are likely to shift to higher added value products when their income per capita increases. Majority of these products are milk and dairy or meat products. On the supply side, weather shocks can abruptly change the production volume and as a supply shock, they may increase the food price volatility. In the recent years, the gap remained constant between the production and the consumption, thus food prices have decreased (FAO, 2017). Between 1960 and 2010, the population has increased by some 230%, while the meat consumption by 450% (from 65 million tons to 290 million tons) (OECD – FAO, 2017). While the meat production and export are expected to increase moderately, the EU milk production may expand by 1% and its share from the international agricultural trade will increase in the future. The EU’s dairy sector aims to achieve a more marketoriented framework, which affects the Hungarian stakeholders as well. The processing and retail segment can be characterised with high concentration and strong bargaining power in general. Dairy sector appears to be purely demand-driven. The level of the individual stakeholders’ cost price is not taken into account during the market’s price setting, which creates strong competition. In the next years, higher market competition and further concentration are expected. Market position will be determined by one’s competitiveness and the level of cooperation among the stakeholders.
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Economic Analysis of a Good Quality Hungarian Dairy Farm with Leading Technology
43-64Views:234The research includes an economic analysis of the dairy farm based on farm data, which makes it possible to assess the cost-income ratio and partial efficiency of each sector, assuming that it operates at a good production level, and in the case of assumed greenfield investments, economy based on dynamic indicators (NPV, IRR, PI, DPP). As many domestic dairy farms produce with the most advanced technology available, and their indicators do not lag far behind the best farms in Western Europe, the so-called analyses refer to “good production standards or practices”. The performed analysis is based on a deterministic simulation modelling created from a production plant’s primary data which uses its own database. Some of the research findings are supported by data and calculations, while others are based on expert estimates and expert opinions. Based on our investigations, it can be stated that the so-called most important specific natural, economic, and investment analysis indicators of the model plant following good production practice in the case of milk production are the following: Specific annual milk yield 11,000 kg/year; Production value: 1,548.5 thousand HUF/cow; Production cost: 1,312 thousand HUF/cow; Net income: 236.5 thousand HUF/cow; EBITDA: 404.6 thousand HUF/cow; Discounted payback period without investment subsidy: 11 year; Discounted payback period at 50% subsidy intensity: 6 years.
JEL codes: Q12, Q13 -
The Progress of the Hungarian Dairy Prices Between 2003 and 2017
23-35Views:72There were notable changes in the dairy industry from 2012 onwards that seriously affected the Hungarian dairy market. The main events were the introduction of the Milk Package in 2012, the beginning of the Russian import ban in 2014 and the abolition of the milk quota system in 2015. These events affected the development of the domestic dairy industry, and at the same time, the Hungarian dairy sector faces long term challenges. The aim of our research is to analyse the dairy price developments between 2003 and 2017. We compare the Hungarian producer and consumer prices over time and we analyse the relationship between the domestic prices and some of the international prices as well. We calculated the coefficient of variation, price ratios and correlation for different time periods. The results indicate that there has been a strong market integration between the domestic and the international market since 2003.