Hal­loumi pro­duc­ers bank­ing on Chi­nese taste buds

But dairy pro­duc­ers fear they can’t meet de­mand due to the lack of goats’ milk

Financial Mirror (Cyprus) - - COMMENT - By Kyr­i­a­cos Kil­iaris

While hal­loumi ex­ports are ex­pected to hit record num­bers, the Min­istry of Agri­cul­ture has signed a pro­to­col with China paving the way for the fa­mous white cheese to wow a huge mar­ket, but farm­ers are feel­ing the squeeze.

The out­look is blurry as pro­duc­ers ar­gue they may not be in a po­si­tion to meet de­mand, feel­ing that pres­sure over the way the cheese is de­scribed in the Pro­tected Des­ig­na­tion of Ori­gin (PDO) file may ham­per growth.

“I don’t know if the deal with China is a bless­ing or a curse as we are strug­gling to cope with the al­ready un­prece­dented global de­mand,” said Yian­nos Pit­tas, ex­port direc­tor of Pit­tas Dairy In­dus­tries.

Pit­tas – the largest hal­loumi ex­porter – said that ex­ports are ex­pected to in­crease by the end of the year to 26,000 tonnes from 23,000 last year.

And Yian­nos Pit­tas is adamant that the grow­ing de­mand abroad will not see Cyprus go with­out.

“As pro­duc­ers, we value the lo­cal mar­ket and we are giv­ing pri­or­ity to it. There is no way Cyprus will be left with­out hal­loumi, nor will prices be af­fected”.

Hal­loumi ex­ports are clos­ing in on EUR 200 mln, record­ing, as of Oc­to­ber 2018, a 15% in­crease com­pared to the whole of 2017 when the dairy in­dus­try ex­ported EUR 156 mln.

If dairy pro­duc­ers’ ex­pec­ta­tions are met, then 2018 will see ex­ports of the squeaky cheese dou­ble since 2015 when EUR 103 mln worth of hal­loumi was ex­ported, breaking the 100 mln bar­rier for the first time.

Although ex­cited over the prospects of hal­loumi en­ter­ing a huge mar­ket such as China, dairy pro­duc­ers fear that milk pro­duc­tion, and es­pe­cially that of goats’, will not suf­fice for the pro­duc­tion of the tra­di­tional cheese.

The pro­to­col is ex­pected to sig­nif­i­cantly in­crease the ex­ports of Cyprus’ flag­ship dairy prod­uct, as pro­duc­ers can di­rectly send their hal­loumi to China by re­mov­ing red tape.

“Hal­loumi pro­duc­ers will be able to ex­port their prod­ucts with­out need­ing a health cer­tifi­cate is­sued for each batch,” ex­plained a Min­istry of Agri­cul­ture of­fi­cial.

Agri­cul­tural Of­fi­cer Sokratis Sokra­tous said the pro­to­col came about af­ter ini­tia­tives taken by Cypriot and Chi­nese busi­ness­men, with the Min­istry in­ter­ven­ing to fa­cil­i­tate the trade with China.

Hal­loumi is al­ready present in the Chi­nese mar­ket, but the pro­to­col will bol­ster ef­forts.

“Just re­cently, an agree­ment be­tween a lo­cal pro­ducer and a Chi­nese com­pany re­gard­ing the ex­port of dairy prod­ucts worth EUR 2.5 mln was signed, with hal­loumi be­ing the main item on the list”.

Sokra­tous said that the pro­to­col with China de­scribes the prod­uct and des­ig­nates the san­i­tary con­di­tions for the pro­duc­tion of hal­loumi.

“The Chi­nese au­thor­i­ties were con­cerned over hy­giene mea­sures taken at the fac­to­ries. Af­ter inspecting five pro­duc­tion units, they have ap­proved them for ex­ports. An­other eight are to be in­spected soon,” he said.

“The pro­to­col puts strict guide­lines. If you don’t com­ply then the pro­to­col is void. If there are any traces of milk pow­der, they stop im­ports the next day.”

The of­fi­cials said that Agri­cul­ture Min­is­ter Costas Kadis has asked for the Chi­nese au­thor­i­ties to speed up the in­spec­tion pro­cesses.

Dairy pro­duc­ers un­sure

An­dreas An­dreou, Gen­eral Sec­re­tary of the Dairy Pro­duc­ers, told the Fi­nan­cial Mir­ror that the as­so­ci­a­tion is ex­cited over the prospects but are deeply con­cerned they may not be able to meet new de­mand as they are al­ready faced with a short­age of milk.

He added that things are tight as it is, with high de­mand from Euro­pean mar­kets such as the UK, Swe­den and Ger­many, while de­mand from coun­tries such as Aus­tralia, with big Cypriot com­mu­ni­ties, are grow­ing rapidly.

“Ex­ports of cheese prod­ucts to the UK alone for the first eight months have seen an in­crease of 15% com­pared to the same pe­riod last year, reach­ing EUR 142 mln. Hal­loumi ac­counts for more than half of UK cheese ex­ports,” said An­dreou.

“We are ex­cited to see the Chi­nese mar­ket be­ing added to our list. And let’s face it, who doesn’t feel op­ti­mistic about the fu­ture of hal­loumi, know­ing that it is served for break­fast at Hong Kong’s ho­tels?

“But this poses its chal­lenges, as we are short of milk, es­pe­cially goat and sheep milk.”

An­dreou said ef­forts are un­der­way, both from au­thor­i­ties and farm­ers to deal with a pos­si­ble short­age. But the as­so­ci­a­tion feels that ef­forts are be­ing un­der­mined by the de­scrip­tion of the prod­uct’s in­gre­di­ents, sub­mit­ted to the Euro­pean Com­mis­sion as a PDO.

The stick­ing point is the ra­tio be­tween cow’s milk and goat and/or sheep’s milk in­cluded in the de­scrip­tion of hal­loumi filed with the EU.

Cur­rently, pro­duc­ers make hal­loumi with a ra­tio of 8020% of cow’s to goat or sheep’s milk, while the de­scrip­tion of the file says that hal­loumi should be pro­duced with a min­i­mum of 51% goat or sheep’s milk as of 2024.

“Such a ra­tio would spell disas­ter for the in­dus­try as there is not enough goat or sheep’s milk be­ing pro­duced, nor is there enough live­stock to pro­duce the milk needed,” said An­dreou.

And con­di­tions have rad­i­cally changed since the file was sub­mit­ted in July 2015. “At that time, we were ex­port­ing only EUR 20-30 mln worth of hal­loumi”.

There is also the taste of the cheese to con­sider.

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